The Business Calc

Selling Price Calculator

Selling price = cost ÷ (1 − target margin). A $60 item needs a $100 price for a 40% margin — not $84. Enter your cost and target margin to get your price.

Updated · Standard cost-accounting formulas, shown in full below.

Try an example
Include per-unit fees that act like costs.
    Charge at least $100.00

    per unit to keep 40.0% of the price as margin.

    $60.00 Unit cost 0.600 1 − your margin $100.00 Price to charge

    That leaves $40.00 per unit before fixed costs. Discounting below $100.00 comes straight out of that.

    Profit per unit $40.00
    Same as markup 66.7%

    If you aimed differently

    • 5 points more margin (45.0%) $109.09
    • 5 points less margin (35.0%) $92.31

    Price breakdown

    How that price breaks down
    A $60.00 cost has to be sold at $100.00 for the teal slice — your margin — to be 40.0% of the bar.

    What this price means

    • Charge $100.00 and you keep $40.00 per unit before fixed costs.
    • Adding your target percentage to cost instead would price this at $84.00 — a real margin of only 28.6%.
    • Each extra 5 points of margin has a price: aiming for 45.0% would mean charging $109.09.

    Selling price formula

    Formula and worked example
    price = unit cost ÷ (1 − target margin ÷ 100)

    Dividing rather than adding is the whole point: margin is measured against the price you're solving for, not against cost. The result is also converted to the equivalent markup using the same formula as the markup vs. margin calculator.

    The price is shown to the nearest cent, so the margin you actually realize can differ from the target by a fraction of a percent.

    Worked example

    Unit cost
    $60
    Target margin
    40%
    Calculation
    $60 ÷ 0.60
    Price to charge
    $100.00
    Check
    $40 ÷ $100 = 40%

    Selling price FAQ

    Why isn't the selling price just cost plus the margin percentage?

    Because margin is defined as a percentage of the selling price, not of cost — and you don't know the price yet. Adding 40% to a $60 cost gives $84, which is only a 28.6% margin. The correct formula divides cost by (1 − margin), giving $100.

    Why does the calculator reject a 100% margin (or higher)?

    At exactly 100% the formula divides by zero, so there is no answer — it would require an infinite price. Above 100% it would require a negative cost. A margin target has to stay below 100%.

    What's the difference between this and the markup vs. margin calculator?

    That tool goes from cost and price to the markup and margin percentages. This one goes the other direction: from cost and a target margin to the price you need to charge.

    Should I round the price it gives me?

    The price is shown to the nearest cent. Rounding further for a cleaner price point (say $99 instead of $98.67) shifts your realized margin slightly — round up and you gain a little margin, round down and you give a little away.

    Does this include taxes or payment processing fees?

    No. It only solves the cost-and-margin relationship. If you have per-unit fees that behave like variable costs, add them to your unit cost before entering it here.

    Related calculators

    Next
    Next step Break-Even Calculator Now that you have a price, find out how many units you need to sell.