How the calculator works
- Profit per unit = selling price − cost price.
- Markup = profit ÷ cost price × 100.
- Margin = profit ÷ selling price × 100.
- From a target margin: selling price = cost price ÷ (1 − margin). A 20% margin on an item costing 80 means a selling price of 80 ÷ 0.8 = 100.
The commonest mistake: mixing up markup and margin
An item costs 80 and sells for 100. The profit is 20. The markup is 20 ÷ 80 = 25%, and the margin is 20 ÷ 100 = 20%. Same profit, two different numbers, because each divides by a different base. If you want a 25% margin and add 25% to the cost, you sell at 100 and your real margin is only 20%. The right selling price is 80 ÷ 0.75 = 106.67, a markup of 33.3%. To convert: markup = margin ÷ (1 − margin), and margin = markup ÷ (1 + markup). For the same profit, markup is always the bigger figure.
What a discount does to profit
A discount comes out of the profit itself, not just its percentage. In the same example (cost 80, price 100), a 10% discount makes the price 90 and the profit 10 instead of 20, so the margin falls from 20% to 11.1%. To earn the original profit you must sell twice the quantity, an increase of 100%. The formula: extra volume needed = discount ÷ (margin − discount). If the discount equals or exceeds the margin, profit is zero or a loss, and no extra volume helps. This is why a small discount on a thin-margin item costs more than it looks.
Official medicine prices in Egypt
Many medicines in Egypt have official consumer prices set by the Egyptian Drug Authority. This calculator does not set or check legal prices; it does arithmetic on the numbers you type. To confirm the official price of an item and the current rules, check the authority’s site, edaegypt.gov.eg, or the competent body. This is general information, not legal or professional advice.
Tips for sound numbers
- Use your real purchase cost after the supplier’s discount, and enter cost and price on the same basis (both with tax or both without).
- Work out the margin for each item and then for the total: a high-margin slow seller does not make up for a fast seller with a thin margin.
- The example figures are illustrative, not real medicine prices.
The calculator does the sum; a true margin needs an accurate cost for each batch. MyClinic (Sehaty) tracks pharmacy stock item by item, with an alert before a line runs out, and records dispensing against the prescription that authorised it. When comparing pharmacy software, read how to choose pharmacy software in Egypt.
Sources
- Egyptian Drug Authority: the regulator of the medicine sector, whose site offers an online pricing-inquiry service. Check it for official prices and current rules.
- Zoho Inventory: Markup vs. Margin: the definitions of markup (profit ÷ cost) and margin (profit ÷ selling price), and the conversion between them.
Questions
What is the difference between margin and markup?
Margin is profit divided by the selling price; markup is profit divided by the cost price. An item costing 80 and selling for 100 earns 20, which is a 20% margin and a 25% markup.
How do I calculate profit percentage in a pharmacy?
Subtract the cost price from the selling price, divide by the selling price and multiply by 100 for the margin. Divide by the cost price instead for the markup.
How do I find the selling price for a margin I want?
Divide the cost price by (1 − margin). For a 25% margin on a cost of 80, the selling price is 80 ÷ 0.75 = 106.67.
How much more must I sell after giving a discount?
Extra volume needed = discount ÷ (margin − discount). A 5% discount on a 20% margin needs 5 ÷ 15 = 33.3% more units to earn the same profit.
Does the calculator set the legal price of a medicine?
No. Many medicines in Egypt have official consumer prices set by the Egyptian Drug Authority, and this tool does not set or check them; it only does arithmetic. See edaegypt.gov.eg.
Do you store the figures I enter?
No. The calculation runs in your browser and nothing is sent to us. To come back to it, use "Copy link to this calculation".
Read the guide
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