Margin calculator: markup vs margin
Enter what a line costs you and see the price, the gross profit, the margin and the markup together, with the quantity breaks worked out. Everything is in pounds and excludes VAT unless you turn it on.
Your costs
Enter what the job costs you. The price comes out on the right.
What to charge
At 250 units, priced to a 35.0% margin.
Unit sell price, excluding VAT
Line total, excluding VAT
Gross profit on the line
Total cost to you
Margin - profit as a share of the sell price
Markup - profit as a share of the cost
(£16.40 + £1.85) × 250 + £40.00 one-off = £4,602.50, which is £18.41 a unit.
Quantity breaks
The same costs and the same margin target, spread across four common break quantities.
| Quantity | Unit cost | Unit sell | Line total | Gross profit | Margin |
|---|---|---|---|---|---|
| 100 | £18.65 | £28.69 | £2,869.00 | £1,004.00 | 35.0% |
| 250 | £18.41 | £28.32 | £7,080.00 | £2,477.50 | 35.0% |
| 500 | £18.33 | £28.20 | £14,100.00 | £4,935.00 | 35.0% |
| 1,000 | £18.29 | £28.14 | £28,140.00 | £9,850.00 | 35.0% |
This is one line. A real quote has twenty.
Zigaflow does this arithmetic on every line of every quote, using the cost from the actual supplier purchase order rather than a figure typed in once and forgotten.
See it on a real quoteMargin and markup are not the same number
Both describe the same gross profit. They differ in what they divide it by, which is why a 50% markup is only a 33.3% margin and why quoting the two as if they were interchangeable is the quietest way to lose money on a job.
Profit as a share of what the customer pays.
Profit as a share of what it cost you.
To price to a target margin, divide rather than multiply: sell price = cost ÷ (1 - margin ÷ 100). A £10 cost at a 30% margin is £14.29, not £13. Multiplying by 1.3 gives you a 30% markup and a 23.1% margin, and the gap is the part nobody notices until the year end.
How to price promotional products in the UK
A promotional line is rarely one cost. The supplier charges for the item, decoration is charged per piece, and origination and carriage are one-offs on the order. Spread the one-offs across the quantity before applying any margin - that is what the calculator does, and why the unit price falls as the quantity rises.
Quantity breaks are arithmetic, not a favour: at 100 units a £22 setup is 22p a piece, at 1,000 it is 2p. A small run carries the same one-off costs as a large one, so a flat percentage on the item cost alone under-prices it every time.
Work in pounds excluding VAT throughout. VAT is collected for HMRC, so it never belongs in a margin calculation.
Price off the supplier cost, not the list price
The cost that matters is the one on the purchase order, after the price break, the settlement discount and carriage. A margin worked out on a catalogue price nobody paid is a forecast, not a fact.
The margin on the job, not on a spreadsheet
Zigaflow carries the forecast cost from the quotation and the actual cost from the linked purchase orders, so the margin on a job moves as the job does.
- Forecast against actual cost on every line, with the running profit on the job
- Actual cost comes from the linked purchase orders, stock allocation or a manual entry
- Order book and margin reports saved and emailed on a schedule
Questions people ask
Margin, markup and how to price a trade line.
See the margin before the quote goes out
Book a demo and we will price a real line of yours in Zigaflow, from the supplier cost up.