1. What is Markup and Markdown?

Markup is the amount added to the cost price of goods to cover overhead and profit. Markdown is a reduction in the selling price of goods, typically to stimulate sales or clear inventory.

2. How Does the Calculator Work?

The calculator uses these formulas:

Where:

• Cost — The original cost of the item
• Original — The original selling price of the item
• Markup % — The percentage to increase the cost
• Markdown % — The percentage to decrease the price

3. Importance of Markup/Markdown Calculations

Details: Proper markup ensures profitability while competitive markdowns can help move inventory. These calculations are fundamental in retail, manufacturing, and service industries.

4. Using the Calculator

Tips: Select calculation type (markup, markdown, or both), enter the base amount in USD, and the percentage. All values must be valid (amount > 0, percentage between 0-100).

5. Frequently Asked Questions (FAQ)

Q1: What's a typical markup percentage?
A: Markup varies by industry. Retail often uses 50-100%, while services may use 20-50%. Luxury items may have much higher markups.

Q2: How is markdown different from discount?
A: Markdown is typically a permanent price reduction, while discounts are usually temporary promotions.

Q3: Can I calculate both markup and markdown at once?
A: Yes, select "Both" as the calculation type to see both results simultaneously.

Q4: Should I use markup on cost or selling price?
A: This calculator uses markup on cost. Some industries use markup on selling price which requires a different formula.

Q5: How do I determine the right markdown percentage?
A: Consider your profit margin, inventory age, and market conditions. Common retail markdowns are 20-70% depending on circumstances.