About the Markup & Profit calculator
Price products correctly with this markup calculator: enter cost, selling price, quantity and overheads to see gross profit, net profit, margin and break-even units — and understand the difference between profit margin vs markup.
How the Markup & Profit calculator works
Revenue is selling price times quantity; total cost adds per-unit costs across the quantity plus your fixed overhead figure.
Markup expresses profit as a percentage of cost, while margin expresses it as a percentage of selling price. They measure the same profit differently, which is why confusing the two leads to underpricing.
Break-even units divide your overhead by the contribution per unit (selling price minus cost). The calculator also shows the price needed for a target 30% margin as a quick reference.
All figures exclude VAT unless you enter VAT-inclusive amounts yourself — be consistent so markup and margin stay meaningful.
The Markup & Profit calculator formula
- Revenue
selling price × quantity- Gross profit
revenue − (cost per unit × quantity)- Net profit
revenue − total cost (variable + overhead)- Markup
(selling price − cost) ÷ cost- Margin
gross profit ÷ revenueA 50% markup equals roughly a 33% margin — markup is always larger than margin.- Break-even units
overhead ÷ (selling price − cost per unit)
Worked example
A small business buys a product at a unit cost, sells it at a markup and wants to see profit, margin and the break-even point.
Selling 100 units with R500 overhead
| Cost per unit | R 50,00 |
|---|---|
| Selling price per unit | R 75,00 |
| Quantity sold | 100 |
| Overhead / fixed costs | R 500,00 |
Results
- Gross profit
- R 2 500,00
- Net profit
- R 2 000,00
- Revenue
- R 7 500,00
- Total cost
- R 5 500,00
- Markup
- 50.00%
- Margin
- 33.33%
- Break-even units
- 20,00
- Price for 30% margin
- R 71,43
Key terms
- Markup
- Profit expressed as a percentage of the cost price.
- Margin
- Profit expressed as a percentage of the selling price. A 100% markup is a 50% margin.
- Gross profit
- Revenue minus the direct (variable) cost of the units sold.
- Net profit
- What remains after variable costs and fixed overheads are deducted.
- Break-even point
- The number of units you must sell before profit turns positive.
Frequently asked questions
What is the difference between markup and margin?
Markup is the profit as a percentage of cost. Margin is the profit as a percentage of selling price. A 50% markup equals a 33.3% margin.
How do I convert markup to margin?
Margin = markup ÷ (1 + markup). For example, a 25% markup is 0.25 ÷ 1.25 = a 20% margin.
Does this calculator include VAT?
No. Enter either VAT-exclusive or VAT-inclusive figures consistently — the calculations apply to whatever amounts you supply.
What margin should a small business aim for?
It varies widely by industry. The reference price for a 30% margin shown in the results is a starting point, not a recommendation.