Build a price from costs and a stated target margin
Separate amounts from percentages
Product, shipping and other costs are amounts per unit. Tax and platform fee are percentages of the selling price in this simplified model. Enter a fixed transaction charge as part of other costs if it applies to the unit you are pricing. A currency choice changes the symbol, not the exchange rate.
The pricing formula
Let C be total unit cost, m the desired margin, t the tax percentage and f the platform fee, all rates written as decimals. Price = C / (1 − m − t − f). The denominator must be positive. Profit is the price minus those costs, taxes and fees; margin is profit divided by price.
Read the markup indicator carefully
The displayed markup indicator is profit after entered percentage deductions divided by total unit cost. Without percentage deductions this matches the usual cost-based markup. With deductions it differs from the gross price uplift, which is (price − cost) / cost. Compare like-for-like definitions when using another calculator.
A model for the costs you enter
The result excludes any expense you have not entered, such as advertising, returns or an allocated share of overhead. Tax is modeled as a simple percentage of price, not a complete tax calculation. Margin color labels are visual bands in the tool, not an industry benchmark or a recommendation.
A hypothetical unit, without percentage deductions
| Input or measure | Amount |
|---|---|
| Total unit cost | 60.00 |
| Desired margin; tax; platform fee | 25%; 0%; 0% |
| Price = 60 / 0.75 | 80.00 |
| Profit; margin; markup | 20.00; 25%; 33.3% |
Frequently asked questions
Is a 25% margin the same as adding 25% to cost?
No. Adding 25% to a cost of 60 gives a price of 75 and a margin of 20%. A 25% margin requires a price of 80 before other deductions.
Does selecting another currency convert my amounts?
No. The selection changes only the displayed currency symbol.
Why can a target margin be rejected?
The desired margin plus entered percentage deductions must be below 100%, otherwise the formula has no positive finite price.
See the rules and formulas in our calculation methodology. Found a discrepancy? Send an example for review.
Explanation reviewed October 17, 2026. Example results depend on the stated assumptions.