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Retail margin calculator formula
Subtract unit cost from selling price to get merchandise gross profit, then divide by selling price for gross margin.
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Retail Margin Calculator
Calculate retail gross profit, margin, and markup side by side so the two percentage bases never get mixed.
FREE TO USEA LOOK ATLAS TOOL
01 USE IT NOW02 NO ACCOUNT03 FIELD NOTES BELOW
WORKING INPUTS
Compare price with merchandise cost.
LIVE RESULT
Gross margin
50.00%$30.00 merchandise gross profit. This is not net profit.GROSS PROFIT$30.00
GROSS MARGIN50.00%
IMPLIED MARKUP100.00%
SELLING PRICE$60.00
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TWO PERCENTAGES, TWO BASES
Keep margin and markup in their proper places.
Gross margin compares gross profit with selling price. Markup compares the same dollars with cost. Seeing both prevents a common pricing mistake.
WORKING VIEW
50% MARGIN$60 PRICE · $30 COST
METHOD(selling price − unit cost) ÷ selling price
WORKING NOTE$30 gross profit · 100% markup on cost
INPUTS → CLEAR OUTPUT
THE FIELD NOTES
Quick answer above. Better decisions below.
Use the result now, then read the practical notes for assumptions, examples, limitations, and the choices behind it.
$60 PRICE · $30 COST50% MARGIN
$30 gross profit · 100% markup on cost
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Retail margin versus markup
A 100% markup on a $30 cost creates a $60 price, but that price contains a 50% gross margin.
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Use gross margin in the full price decision
Merchandise gross profit must still cover marketplace fees, fulfillment, returns, advertising, overhead, taxes, and profit.
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What this calculation excludes
This is not net profit and does not infer taxes, discounts, fees, or operating expenses.
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Retail margin calculator formula
Subtract unit cost from selling price to get merchandise gross profit, then divide by selling price for gross margin.
Divide the same gross-profit dollars by unit cost for markup; the denominator is what makes the percentages different.
Retail margin versus markup
A 100% markup on a $30 cost creates a $60 price, but that price contains a 50% gross margin.
Never substitute one percentage for the other in a pricing rule.
Use the markup to margin calculator when a supplier or colleague gives a percentage on cost and you need its equivalent percentage on selling price.
Use gross margin in the full price decision
Merchandise gross profit must still cover marketplace fees, fulfillment, returns, advertising, overhead, taxes, and profit.
Use companion contribution and profit tools when those costs belong in the question.
After choosing a sustainable shelf price, use the price tag generator to print the supplied product name and price on clear labels.
For an identical-price buy-one-get-one promotion, use the buy one get one free calculator to count free items and cost every delivered unit.
If labor is missing from the supplied unit cost, the labor cost per unit calculator allocates a matched production run before you review the selling margin.
Before reviewing merchandise margin, use the discount calculator to turn an original price and one reduction into the final selling price.
Use the GMROI calculator to compare gross profit with the inventory investment that supported it, alongside the margin on each sale.
When the selling channel is Etsy and you need to work backward from costs and a target margin, use the Etsy price calculator to include its platform-specific fee assumptions.
What this calculation excludes
This is not net profit and does not infer taxes, discounts, fees, or operating expenses.
Keep cost and price in the same currency and unit scope.
Questions, answered.
How do I calculate retail margin?
Subtract unit cost from selling price, divide by selling price, and multiply by 100.
Is margin the same as markup?
No. Margin divides gross profit by selling price; markup divides gross profit by cost.
Is gross margin net profit?
No. Gross margin excludes operating costs, marketplace fees, taxes, financing, and other expenses.
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