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Post Info TOPIC: Whats the difference between Mark-up and GP Margin?
TomR


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Whats the difference between Mark-up and GP Margin?
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Book-keeping question here! I’m getting confused when it comes to %s and ratios. Can anyone please explain what the terms ‘mark-up’ and ‘gross profit percentage’ are?

Thanks,

Tom

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Accountsguy


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Mark-up is a percentage of cost, while the gross profit margin is a percentage of sales.

For example, if you sell a book and mark it up 100% (i.e. buy for £5, sell for £10), the gross profit percentage is only 50% (i.e. £10 - £5).

Guy

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TomR


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Thanks for the example Guy.

Tom



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