Markup vs Margin Calculator
Understand the difference between markup and margin, and calculate your selling price using either method.
Calculate From
What's the Difference?
Markup
Percentage added to cost to get selling price.
Markup = (Profit ÷ Cost) × 100
Margin
Percentage of selling price that is profit.
Margin = (Profit ÷ Selling Price) × 100
Example: A 25% markup on $100 cost = $125 selling price.
But the margin is only 20% ($25 ÷ $125).
Results
Effective Markup
25.0%
Effective Margin
20.0%
Quick Reference
| Markup % | = Margin % |
|---|---|
| 10% | 9.09% |
| 15% | 13.04% |
| 20% | 16.67% |
| 25% | 20.00% |
| 30% | 23.08% |
| 35% | 25.93% |
| 40% | 28.57% |
| 50% | 33.33% |
Formula Sources
These are standard accounting formulas used across industries. For construction-specific markup guidelines, see the CFMA Annual Financial Survey which reports that residential contractors typically use 20-35% markup, while commercial contractors often use 10-20% due to competitive bidding. The SBA provides general guidance on pricing strategy for small businesses.
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