Markup Calculator
Markup calculator. Enter cost price and markup percentage to get the selling price, profit and margin.
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What to work out next
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Markup is the amount added to the cost price to get the selling price, expressed as a percentage of cost. Margin is profit expressed as a percentage of the selling price - the two are not the same.
What this calculator does
Turns a cost price and a markup percentage into a selling price, and shows the profit in pounds plus the margin percentage that markup actually delivers.
Who it is for
- Bar and retail teams applying a house markup to a wholesale cost.
- Chefs converting a plate cost into a starting menu price.
- Anyone who has been told to 'use a 3x markup' and wants to know what margin that produces.
How to use it
- Enter the cost price - use the net, VAT-exclusive cost from the supplier invoice.
- Enter the markup percentage you want to apply on top of that cost.
- Read the selling price, the cash profit and the resulting margin percentage.
- If the price looks wrong for your market, adjust the markup rather than the cost.
The formula
- Selling price = Cost x (1 + Markup% / 100)
- Profit = Selling price - Cost
- Margin% = (Profit / Selling price) x 100
- Markup% = (Profit / Cost) x 100
Worked example
A dish costs £4.20 in ingredients and the kitchen applies a 150% markup.
- Selling price = £4.20 x (1 + 1.50) = £4.20 x 2.5 = £10.50
- Profit = £10.50 - £4.20 = £6.30
- Margin = £6.30 / £10.50 = 60%
A 150% markup produces a £10.50 net selling price and a 60% margin - not a 150% margin.
How to read your result
- Markup and margin are different measures of the same transaction. Markup is profit over cost; margin is profit over selling price.
- A 100% markup is a 50% margin. A 200% markup is a 66.7% margin. A 300% markup is a 75% margin.
- If your target is a margin figure, work back from the margin rather than guessing a markup.
What to do next
- Decide once whether your business talks in markup or margin, and make every price list use the same measure.
- If the resulting price sits awkwardly against competitors, look at portion size or specification before dropping the markup.
- Add VAT to the net selling price separately when you publish the customer-facing price.
Common mistakes to avoid
- Quoting the markup as if it were the margin, which overstates profitability badly.
- Applying markup to a VAT-inclusive cost, which inflates the price by the VAT twice over.
- Ignoring wastage - the true cost per sellable unit is higher than the purchase cost.
Assumptions and limitations
- Selling prices produced here are net of VAT.
- The calculator covers a single item; it does not weight a basket by sales mix.
Dumb Bambi provides general business information, not accounting, tax or legal advice. Read our calculation methodology or tell us about a mistake.
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Keep going with these tools
- Profit Margin Calculator - Work out gross profit and margin %.
- GP Calculator - Gross profit, GP % and markup % in one place.
- VAT Calculator - Add or remove UK VAT from any amount.
Frequently asked questions
What's the difference between markup and margin?+
Markup is profit divided by cost. Margin is profit divided by selling price. A 50% markup is only a 33% margin.
How do I work out selling price from cost and markup?+
Selling price = Cost × (1 + Markup %). £50 cost with 40% markup = £70.