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Bethemesh
Finance & business

Margin, margin rate and markup calculator

Calculate commercial margin from purchase and selling prices excluding tax. Get margin rate, markup rate, multiplier coefficient, price including tax and a target selling price.

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Margin calculation

Enter your purchase price and selling price excluding tax to calculate the main commercial indicators.

Advanced options

Calculate a selling price from a target margin rate

Recommended selling price excl. tax—
Selling price incl. tax—

Ready to calculate your margin

Enter your prices, then run the calculation to display the results.

Why use this tool?

This margin calculator brings together the main commercial indicators from the purchase price and selling price excluding tax: gross margin, margin rate, markup rate, multiplier coefficient and selling price including tax.

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Your data stays on your device and is never sent to our servers.

Smart processing

Calculate and compare financial scenarios with clear indicators and explicit formulas.

Supported formats

Amounts, rates, terms and financial assumptions depending on the calculator.

Save time

Get a clean, ready-to-use result in seconds without installing software or configuring a complex workflow.

Margin calculation formulas

Commercial margin is the difference between the selling price excluding tax and the purchase price excluding tax.

Gross margin

Margin = Selling price excl. tax − Purchase price excl. tax

Gross amount generated before the company’s other expenses.

Margin rate

Margin rate = Margin / Purchase price excl. tax × 100

Margin is compared with purchase cost.

Markup rate

Markup rate = Margin / Selling price excl. tax × 100

Margin is compared with selling price.

These indicators describe gross commercial margin and do not replace a complete profitability analysis.

See the detailed explanation

Margin rate or markup rate?

Both indicators use the same margin but not the same denominator.

  • Margin rate: base = purchase price excl. tax
  • Markup rate: base = selling price excl. tax
Understand the difference

Set your selling price

A target margin rate can determine the required selling price excluding tax from your purchase cost.

  • Start with purchase cost
  • Set a margin target
  • Get the excl. tax and incl. tax prices
Learn more

Fonctionnement

How does this tool work?

The calculation is centralized in a shared engine: the interface sends the prices and VAT rate, then displays the resulting indicators.

Margin rate compares margin with purchase price excluding tax, while markup rate compares the same margin with selling price excluding tax.

Advanced mode can also determine a selling price from a target margin rate.

Use cases

Set a selling price

Determine a consistent price from purchase cost and a target margin.

Analyze commercial profitability

Measure the gross margin generated by the sale of a product or service.

Compare margin rate and markup rate

Avoid confusing two related indicators that use different calculation bases.

Convert excl. tax to incl. tax

Display the final price including tax for the selected VAT rate.

Guide

How to use this tool

  1. 1

    Enter the purchase price excl. tax

    Enter the cost of purchasing the product or service.

  2. 2

    Enter the selling price excl. tax

    Enter the price at which you plan to sell.

  3. 3

    Choose the VAT rate

    The rate is used to calculate the price including tax and multiplier coefficient.

  4. 4

    Analyze the indicators

    Compare margin, margin rate, markup rate and selling price.

Examples

Product purchased for €80 and sold for €120 excl. tax

Margin: €40; margin rate: 50%; markup rate: 33.33%; price incl. tax: €144.

Input

€80 excl. tax → €120 excl. tax · VAT 20%

Tips and best practices

  • Use excluding-tax amounts to compare purchase cost and selling price correctly.
  • Do not confuse margin rate with markup rate: their calculation bases are different.
  • A positive commercial margin does not necessarily mean the activity is profitable after all other expenses.

Frequently asked questions

What is the difference between margin rate and markup rate?

Margin rate compares margin with purchase price excluding tax. Markup rate compares margin with selling price excluding tax.

How do I calculate a 30% margin rate?

To target a 30% margin rate, multiply the purchase price excluding tax by 1.30. A €100 purchase therefore gives a €130 selling price excluding tax.

How do I calculate a selling price from a purchase price?

With a target margin rate, the selling price excluding tax equals the purchase price excluding tax multiplied by 1 plus the margin rate expressed as a decimal.

What is the multiplier coefficient?

In this tool, it is the ratio between selling price including tax and purchase price excluding tax.

Is VAT included in the margin calculation?

Margin, margin rate and markup rate are calculated from excluding-tax amounts. VAT is used here to obtain the final price including tax and the multiplier coefficient.

Can a margin rate exceed 100%?

Yes. If the margin exceeds the purchase price excluding tax, the margin rate is above 100%.

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