Work out profit, margin % and markup % from your cost and selling price, or find the selling price needed for a target margin. Use prices without GST.
Formulas
- Profit = selling price – cost price
- Margin % = profit / selling price x 100
- Markup % = profit / cost price x 100
- Selling price for target margin = cost / (1 – margin%/100)
FAQ
What is the difference between margin and markup?
Margin is profit as a percentage of the selling price. Markup is profit as a percentage of the cost price. A 25% markup equals a 20% margin.
How do I find the selling price for a target margin?
Selling price = cost / (1 – margin%/100). For a cost of 80 and a 20% margin, the price is 100.
Should GST be included in the margin calculation?
No. Use the price before GST for both cost and selling price, because GST is collected for the government and is not your profit.
Can BizKhata show my profit per item?
Yes. Keep your purchase rate updated and BizKhata’s reports show sales, purchases and profit and loss.
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