The Markup Percentage Formula is a mathematical representation of how much above the cost price a product is sold for. It allows businesses to determine profit margins and pricing strategies. In essence, the formula reveals just how profitable a product is: the higher the markup percentage, the more money a business stands to make. To calculate it, one takes their sale price and subtracts their cost price; then they divide this figure by the cost price and multiply it by 100 to get their markup percentage. By using the Markup Percentage Formula businesses can accurately judge the potential success of a product and create pricing plans that will give them the best chance to turn a profit.