Markup to price: how a markup percent sets your price
Setting a sale price by adding a percentage on top of cost is markup pricing, and it's one line of arithmetic: multiply the cost by 1 plus the markup, expressed as a decimal. The tool is a shortcut for a calculation anyone can do on a phone's calculator app.
The formula
Price = cost × (1 + markup ÷ 100). Profit per unit = price − cost. The markup percentage is applied to cost, not to price — that distinction matters, because a markup percentage and a margin percentage on the exact same sale are never the same number.
A real example: a $60 cost, 40% markup
A retailer buys an item wholesale for $60 and wants a 40% markup.
- Multiplier:
1 + 40 ÷ 100 = 1.40. - Price:
$60 × 1.40 = $84.00. - Profit per unit:
$84.00 − $60.00 = $24.00.
Ask for a 40% markup and the shop gets a $24 profit on every $60 unit — not a $24 markup on an $84 price, which is a different question with a different answer (that works out closer to 28.57%, shown below).
A real example: pricing a batch of 40 units
A supplier costs $150 per unit and the shop wants a 25% markup, across a batch of 40 units.
- Multiplier:
1 + 25 ÷ 100 = 1.25. - Price per unit:
$150 × 1.25 = $187.50. - Profit per unit:
$187.50 − $150.00 = $37.50. - Profit on the batch:
$37.50 × 40 = $1,500.00.
The per-unit arithmetic is what sets the price tag; multiplying by the batch size is what tells you whether stocking the batch is actually worth it.
Why a 100% markup isn't a 100% margin
A $40 cost item priced at a 100% markup:
- Price:
$40 × (1 + 100 ÷ 100) = $40 × 2 = $80.00. - Profit:
$80.00 − $40.00 = $40.00. - That $40 profit as a share of the $80 price — the margin — is
$40 ÷ $80 = 50%, not 100%.
Doubling the price (a 100% markup) never gives a 100% margin, because margin is measured against the bigger number (price) and markup against the smaller one (cost). Mixing the two up is one of the most common pricing mistakes in a small shop.
Converting markup to margin without repricing
Margin = markup ÷ (100 + markup) × 100. For the first example's 40% markup: 40 ÷ (100 + 40) × 100 = 40 ÷ 140 × 100 ≈ 28.57% — matching the $24 profit on an $84 price computed directly ($24 ÷ $84 ≈ 28.57%). The formula saves recomputing price and profit just to check what margin a markup percentage actually delivers.
What this doesn't capture
This is the sale price before payment processing fees, shipping, returns, or any discount the item is likely to sell at in practice. It also assumes the cost entered is the real landed cost, including freight and any per-unit fees — leave those out and every number downstream is quietly wrong.
Run your own numbers
The free Markup → Price calculator runs this instantly from your own cost and markup percentage — entirely on your device.