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Markup Calculator

Calculate selling prices by adding markup to your costs. Understand the difference between markup percentage and profit margin to price your jobs correctly.

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Markup vs Margin

Markup is calculated as a percentage of your cost price.Margin is calculated as a percentage of your selling price. They are different ways of looking at profit!

Example

If something costs you £100 and you sell it for £125:

  • Markup: 25% (£25 profit on £100 cost)
  • Margin: 20% (£25 profit on £125 selling price)

When to Use

  • Pricing jobs for clients
  • Calculating profit on materials
  • Understanding trade discounts
  • Setting retail prices
Calculate Markup
CACalifornia Building Code (Title 24)

References & Sources

Standards Cited
  • RSMeans — RSMeans Data — Construction Cost Estimating
    Industry-standard cost data reference for North American construction, including standard markup and overhead percentages
Formulas Used
  • Markup (percentage): sellingPrice = costPrice x (1 + markupPercent / 100)
    Source: Standard accounting formula — Markup is calculated as a percentage of cost price
  • Markup (fixed): sellingPrice = costPrice + fixedMarkup
    Source: Standard accounting formula
  • Profit Margin: profitMargin = (markupAmount / sellingPrice) x 100
    Source: Standard accounting formula — Margin is profit as a percentage of selling price (not cost)
  • Markup Percentage: markupPercent = (markupAmount / costPrice) x 100
    Source: Standard accounting formula — Markup is profit as a percentage of cost price
  • Selling Price for Target Margin: sellingPrice = costPrice / (1 - targetMargin / 100)
    Source: Standard accounting formula — Derives the required selling price to achieve a desired profit margin
  • Discount Calculation: discountedPrice = sellingPrice x (1 - discountPercent / 100)
    Source: Standard accounting formula
Key Assumptions
  • Markup is calculated on cost price; profit margin is calculated on selling price — Standard accounting convention (GAAP)
  • A 50% markup on cost yields a 33.3% profit margin on selling price — Standard accounting relationship between markup and margin
  • Typical NA construction overhead and profit markup ranges from 10-20% — RSMeans estimating guidelines