Small-Business Pricing: Margin, Markup, ROI & Break-Even
Pricing and planning get much easier once you understand four related numbers. Here’s what each one means and how they work together.
Margin vs markup
Markup is profit as a percentage of cost; margin is profit as a percentage of the selling price. A 50% markup is only a 33% margin — confusing the two is a classic pricing mistake. The Markup & Margin tool shows both.
ROI: was it worth it?
Return on Investment compares profit to what you put in: ROI = (gain − cost) ÷ cost. It’s how you judge whether an ad campaign, tool or purchase paid off. The ROI Calculator handles it.
Break-even: when you start profiting
The break-even point is how many units you must sell to cover fixed and variable costs. Below it you lose money; above it you profit. The Break-Even Calculator finds that number so you can set realistic targets.
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Last updated: July 6, 2026