Price to hit the margin you need, not just cover cost. Find the right number.
This calculator sets a product price from unit cost and overhead using a target profit margin measured on the selling price.
The tool adds your unit cost and per-unit overhead to get total cost, then divides by one minus your target margin to find the price. This is important because a margin measured on the selling price is not the same as a markup on cost; a 40 percent margin requires a larger percentage added to cost. Dividing by one minus the margin ensures the profit is the share of the final price you intend.
The output is the price at which your chosen margin holds after covering cost and overhead. Make sure overhead per unit realistically spreads fixed costs across expected volume, because underestimating it inflates your true margin. The tool does not consider what customers will actually pay, competitor pricing, or discounts and returns, all of which shape a viable price. Treat it as a floor based on your costs, then test it against the market.
Because the margin is measured on the selling price, dividing cost by one minus the margin bakes the profit into the final price correctly.
No, markup is profit as a percentage of cost, while margin is profit as a percentage of the selling price, so the same target gives different numbers.
No, it prices from your costs and target margin; you still need to check the result against competitors and customer willingness to pay.
See the exact formula and a worked example on our methodology page.