2 min read
Selling price = cost × (1 + markup%). The resulting gross margin is always lower than the markup.
How to use it
Enter your figures above — the result updates instantly and nothing leaves your browser. Markup & selling-price calculator results are illustrative and not a quote or credit decision.
How to interpret the result
The calculator shows two different figures side by side, and it's worth pausing on why they diverge. Markup is calculated against cost, while gross margin is calculated against the selling price you've just set — the same pound-for-pound profit, expressed against two different bases. For a UK limited company pricing a product or service line, the selling price is only the first output; the margin figure is the one that tells you what proportion of each sale actually contributes to overheads and profit.
A useful habit is to treat the markup figure as an input you control and the margin figure as the output you actually care about. If you're quoting jobs, setting menu prices, or reviewing a supplier price list, working back from a target margin — rather than picking a markup percentage that sounds reasonable — tends to protect profitability more reliably, since a flat markup applied across products with different costs will still generate uneven margins.
Limitations and good practice
This tool works from unit cost and markup alone. It doesn't account for other costs that sit between the unit cost and the final sale — packaging, delivery, payment processing, returns, or the overheads a business needs its overall gross margin to cover. Before using a result to set live prices, it's worth checking the unit cost figure fed in is complete and current, since a stale or partial cost figure will flow straight through into an inflated apparent margin.
It's also worth checking the result against a real invoice or job cost occasionally, particularly where costs move seasonally or a supplier has recently changed terms. The gross margin & markup calculator and the price increase calculator are useful companions where the question is either reviewing margin across a wider set of costs, or working out how much a price needs to move when supplier costs rise.
Frequently asked questions
Does a 100% markup mean 100% margin?
No. A 100% markup doubles the price, which is a 50% gross margin.
Is this a quote?
No — it's a free illustration. Your actual Creditcorp offer depends on an assessment of your company.
Related reading
Gross margin & markup calculator
See your gross margin and the equivalent markup on cost in one place.
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Gross margin & markup calculator
Turn revenue and cost of sales into gross profit, margin % and markup % — and stop confusing the two figures…
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Markup to margin converter
Markup and margin are not the same — see the price and the true gross margin a markup gives.
Read →Price increase calculator (cost rise)
The price rise needed to hold your margin when supplier costs go up.
Read →Funding for UK limited companies
Creditcorp lends to your company, not to you personally — short-term working capital with no personal guarantee. See what your business could access.