Pricing · markup guide
55% markup: margin and selling price
A 55% markup means the selling price is your cost plus 55% of that cost, so you multiply the cost by 1.55. It gives a profit margin of 35.48%, because the profit is measured against the higher selling price. An item that costs £100 sells for £155.00 and makes £55.00 profit.
VAT rate checked against GOV.UK on .
Profit margin
35.48%
from a 55% markup
Multiply cost by
1.55
to get the price ex VAT
Price on £100 cost
£155.00
before VAT
With 20% VAT
× 1.86
cost to shelf price
Selling prices with a 55% markup
Price with VAT assumes you are VAT registered and the item is standard-rated at 20%.
| Cost | Selling price | Profit | Price with VAT |
|---|---|---|---|
| £1.00 | £1.55 | £0.55 | £1.86 |
| £5.00 | £7.75 | £2.75 | £9.30 |
| £10.00 | £15.50 | £5.50 | £18.60 |
| £25.00 | £38.75 | £13.75 | £46.50 |
| £50.00 | £77.50 | £27.50 | £93.00 |
| £100.00 | £155.00 | £55.00 | £186.00 |
| £250.00 | £387.50 | £137.50 | £465.00 |
| £1,000.00 | £1,550.00 | £550.00 | £1,860.00 |
Nearby markups
Markup, the margin it gives and the multiplier to use on your cost.
| Markup | Margin | Multiplier |
|---|---|---|
| 35% | 25.93% | × 1.35 |
| 40% | 28.57% | × 1.4 |
| 45% | 31.03% | × 1.45 |
| 50% | 33.33% | × 1.5 |
| 60% | 37.5% | × 1.6 |
| 65% | 39.39% | × 1.65 |
| 70% | 41.18% | × 1.7 |
| 75% | 42.86% | × 1.75 |
Markup is not the same as margin
People often mix these up. A 55% markup is a 35.48% margin. If you actually want a 55% margin, you need a markup of 122.22%, so the price is cost × 2.2222.
How far you can discount
With a 55% markup you can take up to 35.48% off the selling price before you are selling at cost. A 10% discount leaves a margin of 28.32%, and 20% off leaves 19.35%.
Adding VAT
If you are VAT registered and sell at the 20% standard rate, add VAT after the markup. That makes the shelf price cost × 1.86. The VAT goes to HMRC, so it does not change your 35.48% margin.
Profit in each pound of sales
Gross profit is just over a third of each pound you take before VAT, and the goods cost you the other 65p. After a 10% discount you would need to sell about 39% more units to make the same gross profit as at full price.
How far apart the markup and margin are
At this level the two figures are far apart: the margin is 19.52 percentage points below the markup. On a £100 cost, pricing for a true 55% margin would mean charging £222.22 instead of £155.00. Another 10 points of markup would add 3.91 percentage points of margin.
Other markups
- 40% markup (28.57% margin)
- 45% markup (31.03% margin)
- 50% markup (33.33% margin)
- 60% markup (37.5% margin)
- 65% markup (39.39% margin)
- 70% markup (41.18% margin)
Common questions
What margin is a 55% markup?
35.48%. Divide the markup by 100 plus the markup: 55 ÷ 155 = 35.48%.
How do I add a 55% markup to a price?
Multiply the cost by 1.55. For example, £40 × 1.55 = £62.00. In Excel or Google Sheets, with the cost in A2, use =A2*1.55.
What is a 55% markup on £100?
£55 of profit, so the selling price is £155.00 before VAT, or £186.00 with 20% VAT added.
How do I work out the cost from a price with a 55% markup?
Divide the selling price by 1.55. A price of £60 means a cost of £38.71. If the price includes 20% VAT, divide by 1.2 first.
Sources and assumptions
- Markup = profit ÷ cost. Margin = profit ÷ selling price. Both use prices before VAT.
- Cost means what you pay for the item, excluding any VAT you can reclaim.
Figures are rounded to the nearest penny or to two decimal places.