What is Markup vs Margin?
Markup expresses profit as a percentage of cost. Margin expresses profit as a percentage of selling price. They are different, and confusing them costs money.
A real Kenyan example
Buy at KES 700, sell at KES 1,000. Profit = KES 300. Markup = 300/700 = 42.9%. Margin = 300/1000 = 30%.
Formula
Markup % = Profit ÷ Cost · Margin % = Profit ÷ Selling price
Why it matters
Buyers and merchandisers think in markup (they start from cost). Finance thinks in margin (it starts from revenue). Mixing them up is the most common pricing mistake in Kenyan retail.
How Veira helps
Veira reports both numbers next to every SKU so pricing conversations never go off the rails.
FAQs
Which is bigger?
Markup is always bigger than margin for the same profit.
Convert markup to margin?
Margin = Markup ÷ (1 + Markup). A 50% markup is a 33.3% margin.
Convert margin to markup?
Markup = Margin ÷ (1 − Margin). A 25% margin is a 33.3% markup.
Should I quote margin or markup?
Internally pick one and stick to it. Externally, use what the audience expects.
Does Veira choose for me?
You set the default. Reports show both side by side.