Calculating markup can be a daunting task for businesses, but it doesn’t have to be. The official definition of mark-up is simply the difference between the amount charged for a product or service and its cost. Markup is generally expressed as a percentage, which helps entrepreneurs quickly determine the rate at which they are making a profit. For example, if a business charges $50 for an item that costs them $30 to produce, then the markup percentage would be 66.7%. Markup is essential to any business, as it’s how entrepreneurs determine their profits and losses for each product or service they offer. Knowing this information allows them to make informed decisions on pricing, budgeting, and forecasting. So, the next time you’re wondering what the business definition of markup is, just remember it’s all about knowing your profits and losses.