Markup calculator

1. Pick what to work out.
   • Selling price: enter cost and markup to get the price.
   • Markup %: enter cost and price to get the markup.
   • Price from margin: enter cost and the gross margin you want to get the price.
   • Cost from price: enter price and markup to find the cost (a reverse markup).
2. Enter cost per unit as everything it takes to have one unit ready to sell: the product, inbound freight and duties.
3. Read the result with its margin. Every answer shows the selling price, profit per unit, markup and gross margin together, so you never mix the two up.

Markup = (selling price - cost) ÷ cost × 100
Selling price = cost × (1 + markup)

• What is a 40% markup on $100? $100 × 1.40 = $140. Profit is $40.
• What is a 20% markup on $500? $500 × 1.20 = $600. Profit is $100.
• Markup from price. A tote bag costs $25 and sells for $40: ($40 - $25) ÷ $25 × 100 = 60%.
• Reverse markup. A $40 item with a 60% markup cost $40 ÷ 1.60 = $25.

Price from a target margin

Selling price = cost ÷ (1 - margin)

To keep a 40% margin on a $25 item: $25 ÷ (1 - 0.40) = $41.67. A common mistake is to add 40% to the cost instead, which gives $35 and only a 28.6% margin.

Both describe the same profit, measured against different things. Markup divides the profit by the cost. Margin divides the same profit by the selling price. Because the price is always larger than the cost, margin is always the smaller number.

Gross margin = (selling price - cost) ÷ selling price × 100

The $25 tote bag sold for $40 makes $15 profit: that is a 60% markup and a 37.5% margin.

Is a 30% markup the same as a 30% margin? No. A 30% markup is a 23.1% margin. To earn a 30% margin you need a 42.9% markup.

Margin = markup ÷ (1 + markup)
Markup = margin ÷ (1 - margin)

A 100% markup, doubling the cost, is often called keystone pricing in retail.

Markup is set against the product cost, but the price has to cover much more than that when you sell online with paid ads:

• shipping, fulfilment and packaging you pay on each order
• payment and marketplace fees
• returns and refunds
• the ad spend it takes to win each order

Work backwards. Convert your markup to a margin, subtract the per-order costs, and check the break-even ROAS that is left. A 60% markup is a 37.5% gross margin, which alone needs a 2.67x ROAS to break even before shipping and fees. If that break-even is higher than your ads can reach, the fix is in the price or the product cost, not the ads.

Beyond your costs, the right markup depends on competitors' prices, how customers see the value of the product, how much volume you expect and whether you sell through channels that take a cut.

When you plan a campaign in Ad Autopilot, it asks for your gross margin, not your markup. If you think in markup, convert it first: margin = markup ÷ (1 + markup), so a 60% markup is a 37.5% margin. Entering the markup by mistake would make every order look more profitable than it is.

From the margin and your average order value, Ad Autopilot calculates break-even ROAS (1 ÷ margin), a target ROAS 1.3 times higher that you can edit, and the target CPA, in code rather than by the AI model. It then runs your campaigns against those targets.