Question 1

What's the difference between markup and margin?

Accepted Answer

Markup is the percentage added on top of cost to reach the sell price (markup = profit ÷ cost). Margin is the percentage of the final sell price that is profit (margin = profit ÷ sell price). Because the sell price is always larger than the cost, a given dollar amount of profit is a bigger percentage of cost than of sell price — so markup is always higher than margin for the same sale, except at 0%.

Question 2

How do I calculate a price after two discounts (stacked discounts)?

Accepted Answer

Stacked percentage discounts multiply rather than add. A 20% discount followed by a further 10% off leaves 0.8 × 0.9 = 72% of the original price, an effective discount of 28% — not 30%. Run the original price through this calculator once for the first discount, then feed the resulting price back in for the second.

Question 3

Does a markup percentage over 100% make sense?

Accepted Answer

Yes — a 100% markup simply means the sell price is double the cost, and markups well over 100% are common in retail, especially for small or low-cost items where a large percentage still represents a modest dollar amount.

Discount & Markup Calculator

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