Markup is the percentage added to the cost price of a product to arrive at its selling price. It is calculated as (Selling Price - Cost) / Cost x 100. For example, if a product costs $10 and sells for $25, the markup is 150%.

What is the difference between markup and margin?

Markup is profit divided by cost. Margin is profit divided by selling price. A product costing $10 and selling for $25 has a 150% markup but only a 60% margin. A 100% markup equals a 50% margin, not 100%. Margin can never exceed 100%, while markup has no upper limit.

What is a good markup for ecommerce?

Good markup varies by industry. Apparel & Fashion: 150-300%. Beauty & Personal Care: 200-400%. Electronics: 25-50%. Home & Garden: 100-200%. Health & Supplements: 200-400%. The key is pricing high enough to cover all operating costs while remaining competitive.

How to calculate markup from cost and selling price?

Subtract the cost from the selling price to get profit, then divide by cost and multiply by 100. Formula: Markup % = ((Selling Price - Cost) / Cost) x 100. Example: cost $12, selling price $30, markup = (($30 - $12) / $12) x 100 = 150%.

Why is my markup percentage different from my margin?

Markup divides profit by cost (smaller number), so it is always larger. Margin divides profit by selling price (larger number), so it is always smaller. A 100% markup = 50% margin. A 200% markup = 66.7% margin. This is the most common pricing mistake in ecommerce.

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