Margin Magic: Four Steps to Building Greater Profit

Markup and Margin

The inverse of COGS is the margin. It’s calculated by taking 1 - (cost / retail). Some also refer to this as markup. However, the markup and margin are two different yet related numbers. The markup is expressed as a multiple of the retail price over the cost (1.0 would be selling at cost). The margin is expressed as a percentage of the difference in the retail price over the cost (0 percent would be selling at cost).