Profit Margin Calculator
Calculate gross profit, margin and markup from cost and price, or find the selling price that achieves a target margin or markup. Free, instant, no sign-up.
Results
- Margin = profit ÷ price. Markup = profit ÷ cost. A 50% markup equals a 33.33% margin.
What is Profit Margin Calculator?
Calculates gross profit, margin (profit as a share of the selling price) and markup (profit as a share of the cost). It can also work backwards to the selling price needed for a target margin or markup.
How to use Profit Margin Calculator
- Choose what to Calculate: margin from cost and price, price from a target margin, or price from a target markup.
- Enter the Cost and the selling price, target margin or target markup.
- Read the price, profit, margin and markup.
Example
Cost 60, price 100
Gross profit 40.00; margin 40%; markup 66.67%
When to use Profit Margin Calculator
Use it when pricing products or reading financial statements. Margin and markup are often confused – a 50% markup is only a 33.33% margin – so state which one you mean when quoting prices.
How Profit Margin Calculator works
Profit = price − cost. Margin = profit ÷ price × 100. Markup = profit ÷ cost × 100. Price from a target margin = cost ÷ (1 − margin); price from a target markup = cost × (1 + markup). A margin of 100% or more is impossible, so the margin input is limited to below 100%.
Common Use Cases
- Pricing a product for a 40% margin
- Converting a supplier's markup to margin
- Checking the profitability of a sale
- Training staff on margin vs markup
FAQs
What is the difference between margin and markup?
Margin divides profit by the selling price; markup divides it by the cost. The same sale has a lower margin than markup.
Is this gross or net margin?
Gross margin: only the cost you enter is subtracted. For net margin include all costs in the cost field.
Why can the margin never reach 100%?
That would require a cost of zero; as the margin approaches 100% the required price grows without limit.