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A 25% markup is a 20% margin

Markup is measured against cost. Margin is measured against price. Confusing them is the most common pricing mistake in the trade.

Markup and margin converter

If you add a markup of

Your margin is

20.0%

Same R2,500 of profit, measured two ways.

If you want a margin of

You need a markup of

33.3%

Same R3,333 of profit, measured two ways.

Price = cost ÷ (1 − margin). Margin can never reach 100%.

Common markups and the margin each one really gives
Markup on cost	Margin on price	Margin lost if you confuse them
10%	9.1%	−0.9 pts
15%	13.0%	−2.0 pts
20%	16.7%	−3.3 pts
25%	20.0%	−5.0 pts
30%	23.1%	−6.9 pts
40%	28.6%	−11.4 pts
50%	33.3%	−16.7 pts
100%	50.0%	−50.0 pts

How it works

Runs in your browser. Nothing you type is sent anywhere or stored.

01Markup is profit divided by cost.
02Margin is profit divided by price.
03Because price is always bigger than cost, margin is always smaller than the markup that produced it.

The calculation

Margin= markup ÷ (1 + markup)

Markup= margin ÷ (1 − margin)