Margin = Markup ÷ (100 + Markup) × 100
A 100% markup is a 50% margin. A 50% markup is only a 33.3% margin. The two are never the same number, and the gap widens as markups grow — which is exactly why pricing mistakes happen.
Find your markup in the left column and read the margin on the right.
Markup to margin conversion table
| Markup | Margin | Price = cost × |
|---|---|---|
| 5% | 4.8% | 1.05× |
| 10% | 9.1% | 1.10× |
| 15% | 13.0% | 1.15× |
| 20% | 16.7% | 1.20× |
| 25% | 20.0% | 1.25× |
| 30% | 23.1% | 1.30× |
| 33% | 24.8% | 1.33× |
| 35% | 25.9% | 1.35× |
| 40% | 28.6% | 1.40× |
| 45% | 31.0% | 1.45× |
| 50% | 33.3% | 1.50× |
| 55% | 35.5% | 1.55× |
| 60% | 37.5% | 1.60× |
| 65% | 39.4% | 1.65× |
| 70% | 41.2% | 1.70× |
| 75% | 42.9% | 1.75× |
| 80% | 44.4% | 1.80× |
| 90% | 47.4% | 1.90× |
| 100% | 50.0% | 2.00× |
| 110% | 52.4% | 2.10× |
| 120% | 54.5% | 2.20× |
| 125% | 55.6% | 2.25× |
| 133% | 57.1% | 2.33× |
| 150% | 60.0% | 2.50× |
| 175% | 63.6% | 2.75× |
| 200% | 66.7% | 3.00× |
| 250% | 71.4% | 3.50× |
| 300% | 75.0% | 4.00× |
| 400% | 80.0% | 5.00× |
The right-hand column is the multiplier you apply to your cost to get the price. A 100% markup means price = 2× cost.
Margin to markup conversion table
Going the other way — you know the margin you want and need the markup:
Markup = Margin ÷ (100 − Margin) × 100
| Margin | Markup | Price = cost × |
|---|---|---|
| 10% | 11.1% | 1.11× |
| 15% | 17.6% | 1.18× |
| 20% | 25.0% | 1.25× |
| 25% | 33.3% | 1.33× |
| 30% | 42.9% | 1.43× |
| 33.33% | 50.0% | 1.50× |
| 35% | 53.8% | 1.54× |
| 40% | 66.7% | 1.67× |
| 45% | 81.8% | 1.82× |
| 50% | 100.0% | 2.00× |
| 55% | 122.2% | 2.22× |
| 60% | 150.0% | 2.50× |
| 65% | 185.7% | 2.86× |
| 66.67% | 200.0% | 3.00× |
| 70% | 233.3% | 3.33× |
| 75% | 300.0% | 4.00× |
| 80% | 400.0% | 5.00× |
Notice how the two tables are the same relationship read in opposite directions. A 50% margin needs a 100% markup; a 100% markup produces a 50% margin. Neither is "better" — they describe one price.
Why markup and margin differ
Both are profit, measured against a different base:
- Markup measures profit against cost — what you paid.
- Margin measures profit against price — what the customer paid.
Take a product that costs $40 and sells for $100. Profit is $60.
- Markup = $60 ÷ $40 = 150%
- Margin = $60 ÷ $100 = 60%
Same $60, same product, two very different-looking percentages. Margin is always the smaller of the two (for positive markups), because price is always larger than cost.
The mistake this table prevents
Telling a team "we need 50% margin" and having someone apply a 50% markup gives you a 33.3% margin — you lose 16.7 points of margin on every sale, silently, forever.
At $100 price and $40 cost, that is the difference between $60 profit and $50 profit per unit. On 10,000 units a year, that is $100,000.
The reverse error is just as common in services and SaaS, where people quote a "50% margin" target and price at 1.5× cost instead of 2× cost.
Common markups by industry
These are rough conventions, not rules — competition and category economics matter more than tradition.
| Category | Typical markup | Implied margin |
|---|---|---|
| Grocery / high-volume retail | 25–35% | 20–26% |
| Keystone (general retail baseline) | 100% | 50% |
| Apparel | 100–150% | 50–60% |
| Electronics / accessories | 40–100% | 29–50% |
| Furniture | 150–200% | 60–67% |
| Jewelry | 200–400% | 67–80% |
| Restaurant food | 200–300% | 67–75% |
| Digital products / courses | 400%+ | 80%+ |
"Keystone pricing" is the retail convention of doubling cost — a 100% markup, 50% margin. It survives because it is easy to apply without a table.
Worked example
You buy at $24 and want a 45% margin. What price?
From the margin table, 45% margin needs an 81.8% markup:
Price = $24 × (1 + 0.818) = $43.63
Check: profit = $43.63 − $24 = $19.63. Margin = $19.63 ÷ $43.63 = 45%. ✓
If you had applied a 45% markup instead, the price would be $34.80 and the margin only 31% — a $8.83 shortfall on every unit.
After you set the price
Margin sets the floor for everything downstream. Once you know your margin, you know the minimum ROAS your ads must hit: break-even ROAS = 1 ÷ margin. At a 60% margin that is 1.67×; at 30% it is 3.33×. A price set with the wrong markup quietly makes every ad campaign look worse than it is.
Run your numbers through the markup calculator for live conversion, profit margin calculator for margin, and sale price calculator when you are pricing from cost and target margin. If you are about to discount, check the discount calculator first — every point of discount raises the ROAS you need.