Markup vs. margin: what’s the difference?

Markup and margin both add profit to cost, but the same percent gives a different price. Where each shows in Workroom.

Written By Julia M.

Overview

Markup and margin both add profit to your cost, but they are worked out differently, so the same percent gives a different price.

Watch it: the Finances lesson in Campus, step 2, “Make an estimate”, chapter 3, “Price a line” (starts at 0:52).

Client price = cost × (1 + markup %). A $1,000 cost at 30% markup is $1,300. The $300 profit is 30% of the cost.

Client price = cost ÷ (1 − margin %). A $1,000 cost at 30% margin is $1,428.57. The $428.57 profit is 30% of the price.

Method	Cost	Client price	Profit
30% markup	$1,000	$1,300.00	$300.00
30% margin	$1,000	$1,428.57	$428.57

Every line has a Markup | Margin switch. Price the line whichever way you think.
The footer’s Designer only box shows your company cost, markup and margin for the whole document.
The side panel’s cost analysis shows gross profit and margin.
Before you send, Walter points out lines priced below your usual markup.

Pick one way and use it on every project, so projects compare.
Keep Markup / Margin off in what your client sees, unless you mean to show it.

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