Last updated: March 2026
How to Calculate Markup Percentage
The markup formula is ((Selling Price \u2013 Cost) \u00F7 Cost) \u00D7 100. Start with your cost, subtract it from the selling price to get profit, then divide by cost. The result tells you what percentage you added to your cost.
To find the selling price from a desired markup: Selling Price = Cost \u00D7 (1 + Markup/100). For a $60 item with 50% markup: $60 \u00D7 1.50 = $90. Use Mode 2 in this calculator for instant reverse calculations.
Common Markup Percentages by Industry
Grocery: 5\u201315% \u2014 thin margins compensated by high volume. Clothing: 100\u2013300% \u2014 accounts for returns, seasonality, and discounting. Electronics: 30\u201350% \u2014 competitive pricing keeps markups lower. Restaurants: 200\u2013400% on food items to cover labor, rent, and waste.
These are guidelines, not rules. Your optimal markup depends on your specific cost structure, competitive landscape, and target customer. Use this calculator to model different scenarios and find the markup that meets your margin goals.
Frequently Asked Questions
What is markup?
Markup is the percentage added to the cost of a product to determine the selling price. It’s calculated as (Selling Price – Cost) ÷ Cost × 100. A $60 item sold for $100 has a 66.7% markup. Unlike margin, markup is always based on cost, not revenue.
How do I calculate markup from cost and price?
Markup = ((Selling Price – Cost) ÷ Cost) × 100. Example: Cost is $45, selling price is $75. Markup = (($75 – $45) ÷ $45) × 100 = 66.7%. Enter these values in our calculator for instant results.
What is a common markup in retail?
Retail markups typically range from 50–100% (keystone pricing). Grocery stores use 5–15%, clothing 100–300%, electronics 30–50%, jewelry 100–400%, and restaurants 200–400% on food. Higher markups are common in industries with higher overhead costs.
How do I convert markup to margin?
Margin = Markup ÷ (1 + Markup). For a 50% markup: 0.50 ÷ 1.50 = 0.333 = 33.3% margin. For a 100% markup: 1.00 ÷ 2.00 = 50% margin. Our calculator shows both automatically.
What is keystone pricing?
Keystone pricing is a 100% markup (doubling the cost). A $50 cost item sells for $100. This gives a 50% margin. It’s a simple baseline used across retail, though many businesses adjust from keystone based on competition, demand, and cost structure.
Should I base pricing on markup or margin?
Use margin for financial reporting and benchmarking (it’s the standard in accounting). Use markup for day-to-day pricing decisions (it’s simpler to apply to costs). Just make sure your team is consistent — confusing the two is one of the most common pricing mistakes.