Machine margin and mark-up calculator

How it works

1. Enter your cost lines: parts, machining, labor, commissioning and anything else.
2. Add a contingency percentage if you want one.
3. Choose a target margin, a target mark-up or a fixed price. Add sales tax if it applies.
4. Read the selling price, profit, margin and mark-up.

The formula is selling price = cost / (1 - margin). A 25% margin on a cost of 44,800 gives a price of 59,733.33 and a profit of 14,933.33, which is a 33.3% mark-up on cost.

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Margin questions

What is the difference between margin and mark-up?

Margin is your profit as a share of the selling price. Mark-up is your profit as a share of your cost. A 25% margin is a 33.3% mark-up, and adding 25% to your cost gives only a 20% margin.

Which should I use to price a machine?

Most manufacturers think in margin, because it shows how much of every dollar of sales you keep. If you quote by adding a percentage to cost, use mark-up. The calculator shows both.

Why can the margin not reach 100%?

A 100% margin would need an infinite price compared with your cost, so the calculator accepts margins from 0% up to 99.9%.

Does it convert currencies?

No. The currency list only changes the symbol. Enter your costs in the currency you quote in.