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Markup divides profit by cost; margin divides profit by realized selling price.
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Decision checkpoints

Compare the current choice with the cost floor and your optional margin policy.
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Break-Even Calculator Calculate break-even and target-profit unit sales, then test price and cost changes against planned profit and margin of safety.
Profit Margin Calculator Calculate profit margin and markup from revenue and direct cost, then test target pricing plus optional expenses and percentage fees.
Unit Price Calculator Compare two package prices on the same usable unit basis, accounting for multipacks and expected waste plus shared discounts or checkout fees.
VAT Calculator Calculate VAT from net, gross or VAT-only amounts with exact posted-cent arithmetic, then compare per-unit and invoice-total rounding results.

Two products can earn the same amount of money per sale and still have different markup and margin percentages. The difference is the denominator. Markup compares profit with cost, while margin compares profit with sales revenue. A 60% markup on a cost of 50 produces a price of 80 and a 37.5% margin, not a 60% margin.

That distinction matters whenever a retailer, maker, or reseller sets a list price, checks a discount, or compares supplier costs. Markup is convenient for building a price from cost. Margin is usually more useful for judging how much of the realized sale remains after the costs included in the calculation.

List price
The advertised or quoted amount before the planned discount.
Realized price
The amount left after the planned discount, before subtracting costs and selling fees.
All-in unit cost
Unit cost plus the extra cost and fixed fee entered for one unit.
Net profit
Realized price minus all-in unit cost and the percentage selling fee.

Pricing arithmetic is only a floor for a business decision. Demand, competitor prices, taxes, returns, spoilage, labor, overhead, and customer value may sit outside a unit-cost model. A positive result therefore does not prove that the whole business or product line is profitable.

How to Use This Tool:

Start with the question you need answered, then include every per-unit cost that should affect the price.

  1. Choose Analyze selling price to inspect an existing price, Price by target markup to price from cost, or Price by target margin to solve for a desired share of realized revenue.
  2. Enter Unit cost, then add any Extra cost per unit, Fixed fee per unit, percentage Selling fee, and Planned discount that belong in the scenario.
  3. Select the target percentage and upward Target-price rounding rule when solving a price. The suggested list price is raised to the selected increment so rounding does not push the result below the target.
  4. Review Net profit, Net margin, and the break-even or margin-floor price before approving the price. Use the 10% price-cut check when a promotion is likely.

Interpreting Results:

Read net markup and net margin when extra unit costs, fixed fees, or selling fees are present. The gross figures subtract only the entered unit cost, so they can look healthy while the net figures reveal a weak price.

  • Break-even list price is the upward-rounded price that leaves zero modeled net profit after the planned discount and selling fee.
  • Margin-floor list price is the minimum rounded list price that reaches the margin percentage you entered.
  • Keystone list price applies a 100% net markup to all-in unit cost before fee and discount adjustments. It is a comparison point, not a recommendation.
  • The 10% cut shows how a lower list price changes net profit and net margin. It does not predict whether the lower price will increase sales volume.

Technical Details:

The pricing model separates the posted list price from the revenue actually realized after a planned discount. A percentage selling fee is then charged against that realized price. This order matters because a fee applied after discount is smaller than the same percentage applied to the original list price.

Formula Core:

Let C be all-in unit cost, L list price, d the discount rate, f the selling-fee rate, and R realized price. The basic profit path is:

C=unit cost+extra unit cost+fixed fee R=L(1−d) F=Rf p=R−C−F

Net markup divides modeled net profit p by all-in cost. Net margin divides the same profit by realized price.

net markup=pC×100% net margin=pR×100%

Target-price equations:

A target markup rate m solves from cost. A target margin rate g solves from realized revenue. Both are converted back to a pre-discount list price.

Lmarkup= C(1+m)(1−f)(1−d) Lmargin= C(1−f−g)(1−d)

The target-margin denominator must remain positive, so target margin plus selling fee must be less than 100%. The same condition applies to the optional margin floor. Discounts and fees may each range from 0% through 95%; target markup may range from 0% through 1,000%, and target margin from 0% through 95%.

Verified substitution:

With an all-in cost of 60, a 40% target margin, a 10% selling fee, and a 20% planned discount, the target-margin equation gives a list price of 150. The realized price is 120, the fee is 12, and net profit is 48. Dividing 48 by 120 confirms the 40% net margin.

Target prices are rounded upward to 0.01, 0.05, 0.50, a whole unit, or the next qualifying .99 ending. Existing prices entered for analysis are not changed by the target-price rounding choice. Currency selection changes formatting only and does not perform exchange-rate conversion.

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