Margin and markup calculator
Price your products correctly. Work from cost and price, from a target margin, or from a markup, and see the price to charge with GST.
Margin or markup?
Margin = Profit ÷ Selling price × 100. Markup = Profit ÷ Cost × 100.
An item bought for ₹600 and sold for ₹800 makes ₹200 profit: a 25% margin but a 33.3% markup. If you want a 25% margin, you cannot simply add 25% to cost; that gives ₹750 and only a 20% margin.
Price for a target margin = Cost ÷ (1 − Margin ÷ 100). For a 25% margin on ₹600: 600 ÷ 0.75 = ₹800.
Margins should be calculated on prices before GST, because GST collected is passed on to the government. Read margin vs markup for a full conversion table and the effect of discounts.
Questions about margins
Can margin be more than 100 percent?
No. Margin is profit as a share of selling price, so it is always below 100%. Markup can exceed 100%, for example when you sell at three times cost.
Should I include shop rent in cost price?
For gross margin, use only the direct cost of the goods. Rent, salaries and electricity are covered by gross margin and show up in net profit. Use the break-even calculator to check that your margin covers them.
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