I'm trying to create a spreadsheet that shows my markup %. The values that I am referencing are PART COST and CUSTOMER PRICE. If part costs me $10 and the customer price is $20. That's 100% markup. How do create a cell that shows me that percentage.
The generic formula for this would be
(Customer Price ÷ Cost) -1
So if you had the price in B3 and the cost in B2 you could calculate the markup with this formula:
=B3/B2-1
And format the cell containing the formula as Percentage.
SG
what does the -1 mean?
mjdibenedetto wrote:
what does the -1 mean?
That's simply algebra. In calculating a markup percentage you're essentially trying to calculate the difference between the Price and the Cost and then express that difference as a percentage of the Cost.
The difference is (Price-Cost).
Expressing that difference as a percentage of the cost could be done this way:
(Price-Cost) / Cost
Dividing the numerator and the denominator by Cost simplifies that expression to Price /Cost -1. The simplified expression often is used in "percentage of change" calculations. Just take the ending value and divide it by the beginning value, then subtract 1.
SG
you have educated me, sir. the formula works of course, thank you very much.
Markup Percentage
