vault backup: 2026-01-02 08:12:04

markup-vs-margin.md

@@ -11,6 +11,10 @@ title: Markup vs. Margin
 ---
 # Markup vs. Margin
 
+**Markup** and **margin** are both terms to describe the percent profit of a sold good or service.
+**Markup** describes an item's profit relative to its cost to the merchant.
+**Margin** describes an item's profit relative to its cost to the customer.
+
 $$
 \text{Profit} = \text{Sell Price} - \text{Cost}, \quad
 \text{Markup} = \frac{\text{Profit}}{\text{Cost}}, \quad
@@ -31,4 +35,4 @@ Because of \*waves hands\* finance reasons,
 contractors (and sellers of products and services in general)
 almost exclusively talk about profit in terms of margin.
 Even if someone says "15% _markup_"
-they're still probably talking about margin.
+they may still be talking about margin.