Business guide

Two percentages. Different denominators.

Learn the difference between gross margin and markup with a ₹100 cost / ₹140 selling-price example, then use the calculator.

Start with comparable amounts

Use cost and selling price on a consistent basis. For a simple item calculation, profit is selling price minus cost. If your cost excludes freight, packaging or overhead, the resulting profit excludes them too.

Margin uses selling price

Margin % = profit ÷ selling price × 100. For a cost of ₹100 and selling price of ₹140, profit is ₹40. Margin is 40 ÷ 140 × 100, or approximately 28.57%.

Markup uses cost

Markup % = profit ÷ cost × 100. For the same item, markup is 40 ÷ 100 × 100, or 40%. Confusing a 40% markup with a 40% margin can lead to an unintended selling price.

Handle special cases carefully

The margin percentage is undefined at a zero selling price; markup is undefined at zero cost. Returns, discounts and tax treatment may change the amounts you should compare. These formulas are an operational aid, not a complete financial statement.

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