Margin and markup are not the same number, and confusing them is how a programme looks profitable until it is not.
Margin and markup, side by side
A 100% markup is a 50% margin. Showing both at once removes the single most common pricing error, which is quoting one and budgeting on the other.
Fixed costs and break-even
Per-item profit is only half the picture. Enter your fixed costs and you get the number of units that clears them, which is the figure that actually decides whether to proceed.
Frequently asked questions
- What is the difference between margin and markup?
- Markup is profit as a percentage of your cost. Margin is profit as a percentage of your price. Buying at $100 and selling at $200 is a 100% markup and a 50% margin — same money, very different numbers.
- How do I calculate break-even?
- Divide fixed costs by profit per unit. If fixed costs are $2,000 and you make $130 per unit, you break even at 16 units. The calculator rounds up, because you cannot sell a fraction.
- What margin should I target?
- That depends entirely on your costs, market and volume, and this tool does not offer an opinion. It reports the arithmetic for the numbers you enter.