Markup is the amount by which the cost of a product is increased in order to obtain the selling price. For example, a markup of $90 on a product that costs $110 would give a selling price of $200. Which is an 82% markup (markup divided by product cost)
Price - Cost / Cost = MarkupMargin is the selling price of a product minus the cost of goods. Using the above example, the margin for a product sold for $200 with a cost of $110 would be $90. Which is a 45% margin (margin divided by the selling price).
Price - Cost / Price = Margin
Converting Markup to Margin & vice versa
https://calculator.academy/markup-to-margin-calculator/
Markup = Margin / (1 - Margin)
Margin = Markup / (1 + Markup)
Markup % | Margin % |
|---|---|
100 | 50 |
200 | 66.6 |
300 | 75 |
400 | 80 |
500 | 83.3 |