Convert a profit margin into the equivalent markup — and back — so you price with the number you actually mean.
Margin is profit as a share of the selling PRICE; markup is profit as a share of the COST. Confusing the two systematically underprices — this converts cleanly between them. General information.
Both describe profit, but against different bases: margin is a share of the price, markup a share of the cost. A 50% markup is only a 33% margin. Mixing them up is one of the most common — and costly — pricing mistakes.
Markup = margin ÷ (1 − margin) · Margin = markup ÷ (1 + markup)
Both describe the gap between what something costs you and what you sell it for. The difference is the denominator. Markup divides the profit by the cost: "how much did I add on top?" Margin divides the same profit by the price: "how much of each dollar the customer paid do I keep?" Because price is always larger than cost when there is any profit at all, margin is always the smaller percentage. The two conversion formulas fall straight out of that: markup = margin ÷ (1 − margin), and margin = markup ÷ (1 + markup). The calculator runs both directions and, to make the numbers concrete, shows what $100 of cost sells for under each.
Left side: a 40% margin. Markup = 0.40 ÷ (1 − 0.40) = 0.40 ÷ 0.60 = 66.7%. To earn 40 cents of every sales dollar on a $100 cost, the price must be $100 ÷ 0.60 = $166.67; profit is $66.67, and $66.67 ÷ $166.67 is indeed 40%. Right side: a 50% markup. Margin = 0.50 ÷ (1 + 0.50) = 33.3%. On $100 of cost that sells for $150, and the $50 of profit is a third of the price. Put the two side by side: "50% markup" sounds bigger than "40% margin" and is in fact the smaller profit.
At small percentages the two are close enough to be confused without much damage — a 10% margin is an 11.1% markup. By 25% margin the markup is 33.3%; by 50% it is 100%; a 75% margin needs a 300% markup, and a 100% margin is impossible (you would have to sell for infinite money). The practical consequence: the higher the margin your business needs, the more expensive it is to get the words wrong. A landscaper aiming for 20% and marking up 20% loses 3.3 points; a consultant aiming for 60% and marking up 60% ends up at 37.5%.
The classic is applying a margin percentage as if it were a markup: multiplying cost by 1.40 to "get a 40% margin" and getting 28.6%. Its mirror is dividing the price by 1.40 to back out cost, which understates cost and overstates profit. Contractors often meet a third version in "overhead and profit": quoting 10% and 10% on cost and believing that is a 20% margin, when it is 21% markup and 17.4% margin. And a fourth, on marketplaces: computing margin before fees, when the fee is a cost that must be subtracted from the price first.
A converter answers one pair at a time. The moment you are pricing a job with materials at one markup, labour at another and subcontractors at a third, you need the blended margin the whole job actually delivers — and that is a sheet, not a mental sum. The Trades Job & Money Toolkit includes a Job Cost & Markup Calculator that does exactly this per job and shows the true margin at the bottom; the cost-plus pricing calculator applies a single markup to a single cost, and the profit margin calculator works the same arithmetic from price and cost.
If you want a 40% margin but apply a 40% markup, you'll fall short every sale. The gap widens as the numbers grow — always convert to the one you mean.
Markup is easier at the counter (cost × factor); margin is what shows up in your P&L. Know both and the conversion between them.
Related: markup calculator · profit margin calculator · gross profit calculator · all free calculators.
More free pricing & profit tools — no signup, works on any device.
Yes. The Margin to Markup Calculator is completely free, runs in your browser, and never asks for a signup, email, or download. Enter your numbers and the result updates instantly.
It uses standard formulas and recalculates the moment you change a value, so the math is exact for the inputs you enter. Treat the result as a reliable planning estimate; for decisions with legal or tax consequences, confirm the figures with a qualified professional.
Yes. The calculator is mobile-friendly and works on any phone, tablet, or computer — there is no app to install and nothing to save.
Yes. Scroll to “Add this free calculator to your site” above and copy the embed snippet to place the live calculator on your blog or website for free.
Last reviewed: September 2026. Free to use, no signup — Margin to Markup Calculator by ToolWise Digital.
Copy the snippet to embed the live calculator on your blog or website — free for any site. The small “Calculator by ToolWise Digital” credit line keeps it free; you're welcome to remove it, but we appreciate you leaving it.
Ready-made Google Sheets & Excel trackers for money, taxes, and small business — each with a free phone version.
Browse the shop →Simple Monthly Budget and our Small Business Bookkeeping template (Google Sheets & Excel) — no signup, no wall, just the files. If you also want the occasional short note on pricing, bookkeeping and the money side of a small business, the list is here. No spam — unsubscribe anytime.