Margin vs Markup: Key Pricing Differences | e-Life and Work Difference Between Margin and Markup Margin and markup are two essential pricing concepts in business, but they have different meanings and uses. 1. What is Margin? Margin refers to the percentage of profit based on the selling price. It is calculated using the formula: Margin = ( Selling Price − Cost Selling Price ) × 100 % \text{Margin} = \left(\frac{\text{Selling Price} - \text{Cost}}{\text{Selling Price}}\right) \times 100\% Example: Product cost = $50 Selling price = $100 Margin = ( 100 − 50 100 ) × 100 % = 50 % \left(\frac{100 - 50}{100}\right) \times 100\% = 50\% Margin represents how much of the selling price is actual profit. 2. What is Markup? Markup is the percentage increase in price based on the cost of the product. It is calculated as: Markup = ( Selling Price − Cost Cost ) × 100 % \text{Markup} = \...
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