Business

Profit Margin & Markup Calculator

Convert between margin and markup, work out selling price from cost, or find profit from any pair of inputs. Customize adds quantity totals, discount impact, and industry benchmark check.

How to use this How is this calculated?

Detail levelQuick shows per-unit margin, markup, and profit. Customize adds quantity totals (revenue, cost, profit across N units), discount impact on effective margin, and an industry benchmark check.

What numbers do you have?Most common. Enter what it costs you and the margin you want — get the selling price.

Cost per unit (AED)What you pay your supplier, or what it costs to make one unit (materials + labour + allocated overhead).

Margin (%)Profit as a percentage of selling price.

Enter cost per unit.

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How to use

1
Pick the mode that matches the numbers you already have. Most common: cost + target margin → find selling price.
2
Enter the numbers. Cost is what you pay per unit. Selling price is what the customer pays. Margin is profit as a % of selling price. Markup is profit as a % of cost.
3
The calculator shows the missing two values plus profit per unit.
4
Quick reference: 50% markup = 33.3% margin. 100% markup = 50% margin. 200% markup = 66.7% margin. Margin can never go above 100%.

Frequently asked questions

Margin is profit as a percentage of selling price. Markup is profit as a percentage of cost. Buy something for AED 100, sell for AED 150 — you have a AED 50 profit. Margin is 50/150 = 33.3%. Markup is 50/100 = 50%. They describe the same trade in two ways.

Because markup is easier to calculate at the cash register. 'Cost × 1.5' is faster than working backwards from a 33% margin. But financiers and accountants prefer margin because it tells you what fraction of every revenue dollar is profit — the bottom-line health of the business.

Hugely variable. Fashion: 50-70% margin. Electronics: 5-15% margin. Restaurants: 60-70% margin on food, 70-85% on drinks. Pharmacy: 15-25% on prescription, 40-60% on cosmetics. Category-specific benchmarks are the right reference.

No. Margin is profit ÷ selling price, and profit can never exceed selling price (otherwise cost would be negative). The maximum theoretical margin is 99.99% — meaning the cost is almost nothing. Markup, however, can be 500%, 1000%, or higher.

Selling price = cost ÷ (1 − margin %). For AED 100 cost and 40% target margin: 100 ÷ (1 − 0.40) = 100 ÷ 0.60 = AED 166.67. The calculator's 'cost + target margin' mode does this for you.

Cost-plus pricing (cost + target margin) is the easiest but rarely optimal. Value-based pricing (charge what the customer will pay) usually generates more margin. Cost-plus serves as the floor — selling below it loses money on every unit. Value-based pricing finds the ceiling.

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Source: Standard accounting formulae · Last verified 2026-06. This tool provides estimates only and is not legal, tax or financial advice. Always verify your specific situation with the relevant UAE authority or a licensed advisor before taking action.