How to Calculate a 50% Margin

The margin is the percentage of the sales price that equals profit.

The margin represents the percentage of the sales price of an item that is profit. If you know your cost, you can figure out the sales price you need to set to have a 50 percent margin. Accurately pricing your goods helps make your business more profitable. If you set the price too low, you miss out on extra profit. If you set the price to high, you miss out on customers because your competitors will offer a lower price.

Things You'll Need

• Calculator

Instructions

1. Subtract 50 percent from 100 percent to get 50 percent as the percentage you have to divide the original cost by to calculate

2. Divide 50 percent by 100 to get 0.5. This converts the percentage to a decimal.

3. Divide the cost of the item by 0.5 to find the selling price that would give you a 50 percent margin. For example, if you have a cost of $66, divide $66 by 0.5 to find you would need a sales price $132 to have a 50 percent margin.

References

• Building Trade: Markup or Margin
• CSG Networks: Retail Margin and Markup