$70 cost and $100 sale produce $30 profit: 30% margin and about 42.86% markup. A 30% markup would give a $91 sale, only about 23.08% margin.
The denominators differ
With $70 cost and a $100 price, profit is $30. Margin is $30 ÷ $100 = 30%, while markup is $30 ÷ $70 ≈ 42.86%.
Use the correct target formula
For a 30% margin with no percentage fees, divide cost by 0.70. Adding 30% to cost would produce a 30% markup and a smaller margin.
Include quote-based fees
If a processor takes 3% of the sale, a 30% target margin requires $70 ÷ (1 − 0.03 − 0.30) = $104.48. Confirm the fee is actually based on the quoted amount.
When to use this method
Use margin when setting a profit goal as a share of sales. Use markup when describing how much profit is added relative to cost; name the denominator when discussing a percentage.
A mistake to avoid
Adding 30% to a $70 cost gives $91, not the $100 needed for a 30% margin. A percentage label without its denominator can misstate the goal.
What this does not tell you
These are calculation examples using stated assumptions. They are not national service rates, local quotes, tax advice, or a prediction of demand. Confirm your own scope, costs, fee basis, and any local requirements before sending a price.
Source and updates
The formulas and assumptions are explained in our methodology. This guide was prepared on 2026-11-06. If you find an error, send a correction.