GST & business
Gross Margin vs Markup: Difference & Conversion Table
Updated 25 September 2026 · 3 min read
Markup and margin both measure profit — but against different bases. Mixing them up is one of the most common pricing mistakes in small businesses.
- Markup = profit ÷ cost
- Gross margin = profit ÷ selling price
Buy for ₹750, sell for ₹1,000: profit ₹250. Markup = 250 ÷ 750 = 33.3%. Margin = 250 ÷ 1,000 = 25%. Same sale, two different percentages.
Conversion table
| Markup | Margin | Cost ₹100 sells for |
|---|---|---|
| 20% | 16.7% | ₹120 |
| 25% | 20% | ₹125 |
| 33.3% | 25% | ₹133.33 |
| 50% | 33.3% | ₹150 |
| 100% | 50% | ₹200 |
Margin = Markup ÷ (1 + Markup) · Markup = Margin ÷ (1 − Margin)
Which should you use?
Price with markup if it's easier (“cost plus 50%”), but track margin: your expenses, discounts and targets are all shares of sales, and margin can never exceed 100% while markup can. When a supplier or buyer quotes a percentage, ask which one they mean.
Convert between margin and markupFind profit, gross margin and markup from cost and selling price — or the price for a target margin.Need the full method with target prices? Read how to calculate profit margin.
Frequently asked questions
Is 100% markup the same as 50% margin?
Yes. Doubling the cost (₹500 → ₹1,000) is a 100% markup, and the ₹500 profit is 50% of the ₹1,000 selling price.
How do I convert markup to margin?
Margin = markup ÷ (1 + markup). For a 25% markup: 0.25 ÷ 1.25 = 20% margin.