Convert between markup percentage and margin percentage instantly.
Margin % = Markup / (100 + Markup) × 100. Markup % = Margin / (100 - Margin) × 100.
Markup and margin sound interchangeable and describe the same transaction — but they're calculated against different denominators, and mixing them up is one of the most common pricing mistakes small business owners make. Markup is calculated as a percentage of cost: (Selling Price − Cost) ÷ Cost × 100. Margin is calculated as a percentage of the selling price: (Selling Price − Cost) ÷ Selling Price × 100. Because the denominator changes, the same rupee amount of profit produces two genuinely different percentages — and the gap gets bigger, not smaller, the higher the percentage climbs.
A concrete illustration of how much this matters: a shop owner who applies a consistent 50% markup across their product range — a product costing ₹100 sold for ₹150 — might expect a 50% margin too, but the actual margin is only 33.3% (₹50 profit ÷ ₹150 selling price). The relationship isn't linear either: a 50% margin actually corresponds to a 100% markup, not a 50% markup, which is why using the wrong term when setting prices or reading a competitor's stated numbers can lead to systematically underpricing (if you think you're hitting a margin target but you're actually only hitting the smaller markup number) or misjudging how profitable a deal really is. The practical fix is simple but often skipped: always state clearly which one you're calculating, and convert explicitly rather than assuming the two percentages are close enough to use interchangeably.
Markup divides profit by cost: (Price − Cost) ÷ Cost × 100. Margin divides profit by selling price: (Price − Cost) ÷ Price × 100. Both describe the same rupee amount of profit on the same sale, but because the denominators differ, they always produce different percentages for any profitable sale.
Only 33.3%, not 50%. On a product costing ₹100 with a 50% markup, you'd sell it for ₹150 — a ₹50 profit on a ₹150 selling price is 33.3% margin (₹50 ÷ ₹150), not 50%. This gap is exactly why treating markup and margin as interchangeable leads to a lower actual profit percentage than intended.
A 100% markup, not 50%. This non-obvious relationship — where a 50% margin requires double the markup percentage — is a direct consequence of the different denominators, and it's the single most common source of pricing miscalculation when business owners set prices using one metric while thinking in terms of the other.
Because if you're targeting a specific profit percentage but calculating with the wrong formula, you'll systematically price below your actual intended profitability — a business aiming for 50% margin but pricing using 50% markup ends up with only 33.3% margin, a meaningful and compounding shortfall across every sale.