Two formulas, one destination: working from a markup, price = cost × (1 + markup%). Working from a margin, price = cost ÷ (1 − margin%). Markup starts at what you paid and adds up; margin starts at the price and asks what share is profit. On a $10 cost, a 100% markup and a 50% margin land on the same $19.99-ish shelf price — two roads, one destination, and this calculator drives both.
Retail lives on markup — but survives on margin. Keystone pricing (doubling wholesale cost) is the traditional floor for independent shops: a 100% markup, which is a 50% margin before rent. Gift and specialty often run higher; groceries and hardware run far lower and make it up in turns.
The number that matters after the price is set is the markdown math: a 20%-off sale needs roughly 1.5× the units to hold profit. Price the shelf so that the discount you'll eventually run still pays the rent.
| Wholesale | Keystone price | Margin |
|---|---|---|
| $5 | $10 | 50% |
| $12 | $24 | 50% |
| $25 | $50 | 50% |
Keep going with these tools — they build on this calculation: Retail Math Calculator, Food Cost Percentage Calculator, Restaurant Profit Margin Calculator, Restaurant Break-Even Calculator and Menu Pricing Calculator.
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Two ways. From a markup: price = cost × (1 + markup). A $10 item at a 100% markup prices at $20. From a margin: price = cost ÷ (1 − margin). The same $20 price is a 50% margin, because $10 of it is profit. Use markup when you think in add-ons, margin when you plan around profit.
Keystone (100% markup, 50% margin) is the traditional starting point for gifts, décor and apparel. Convenience and grocery categories run 15–35% margins and survive on volume — know your category before you set the percentage.
Because margin compares profit to the price, not the cost. Doubling a $10 cost makes $10 profit on a $20 price — 100% markup, 50% margin. Every percentage point of margin needs more than two points of markup as costs rise.
Keystone is the old retail rule of doubling the wholesale cost: buy at $12, ticket it at $24. It is a 100% markup but only a 50% margin — the other half covers rent, payroll and shrink. It works when turns are slow and value is hard to compare; it fails on commodity items customers can price-check.
A 50%-margin item survives a 20% discount only if volume rises about 67%. Check the margin first, the volume second — most clearance loses money twice: once on the discount, once on the space it holds.