Margin vs Markup Pricing Calculator
Margin and markup describe the same profit and give different numbers, and pricing with the wrong one of the two is the most expensive arithmetic mistake in trade. This calculator builds the real landed cost first, then prices from it.
The cost section comes first for a reason. A supplier invoice of 100 is not what the unit costs: freight and customs, handling, packaging and bank charges take it to 120 in the sample data. Every margin calculated against the invoice price rather than the landed cost is overstated, and the error is invisible because it is consistent.
The conversion is the heart of the sheet. At a price of 180 over a cost of 120, the margin is 33.3% and the markup is 50% — one profit, two percentages. Set a 40% target and the difference becomes money: priced at a 40% margin the unit sells for 200, priced at a 40% markup it sells for 168. That is 32 per unit, given away by using the wrong denominator.
The discount section answers the question most price lists never ask. A discount comes entirely out of gross profit, so volume has to rise by much more than the discount itself. On the sample's 33.3% margin, 10% off needs 43% more units just to stand still. The second sheet turns that into a full grid: find your margin down the side, the discount across the top, and read how much more you would have to sell. Where the discount is larger than the margin, the cell says impossible, because it is.
The same grid works in reverse for a price rise, which is the direction most owners never test: on a 30% margin you can lose about a quarter of your volume after a 10% increase and still be no worse off. Finmap shows the margin you are actually achieving after discounts and returns, which is usually a few points below the one in the price list.
