How do I work out overhead per unit?
Add up a month of fixed costs such as rent, software and equipment, then divide by the number of units you make in that month.
Cost-Plus Pricing Calculator
Add up what one unit really costs, then set a price with the markup you choose.
Your numbers
Add up the cost of one unit, then choose the markup to add on top.
Your share of rent, tools, software and other fixed costs.
Result
Results update as you type.
Enter your values to see the result.
How cost-plus pricing works
Cost-plus pricing starts from what one unit costs you to produce and adds a fixed markup for profit. It is simple, easy to explain to customers, and makes sure every sale covers its costs.
Total unit cost
Materials + labor + overhead
Cost-plus price
Total unit cost × (1 + markup ÷ 100)
Example: a handmade product
Materials cost $6.50, your time is worth $9.00 per unit, and each unit’s share of overhead is $2.50. The total unit cost is $18.00. With a 50% markup, the price is $27.00, leaving $9.00 profit — a 33.33% margin.
| Markup | Price | Profit | Margin |
|---|---|---|---|
| 25% | $22.50 | $4.50 | 20% |
| 50% | $27.00 | $9.00 | 33.33% |
| 75% | $31.50 | $13.50 | 42.86% |
| 100% | $36.00 | $18.00 | 50% |
Frequently asked questions
Should I pay myself in the labor cost?
Yes. Multiply the time one unit takes by the hourly rate you want. Leaving labor out makes the price look profitable while your time goes unpaid.
What are the downsides of cost-plus pricing?
It ignores what customers will pay and what competitors charge. Use it as a floor, then check the market before settling on a price.
Is markup the same as margin here?
No. Cost-plus uses markup on cost. The calculator also shows the margin, which is profit as a share of the selling price.