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Profit Margin Calculator
Enter revenue and cost to see gross profit, profit margin and markup.
Enter revenue and cost to see your margins.
Formula
Profit = revenue − cost · Margin % = profit ÷ revenue × 100 · Markup % = profit ÷ cost × 100
How to calculate
- 1Subtract your total cost of goods from your revenue to get gross profit.
- 2Divide profit by revenue and multiply by 100 for your margin.
- 3Divide profit by cost and multiply by 100 for your markup.
- 4Compare the margin against typical ranges in your industry to sanity-check pricing.
How to use this calculator
- 1Enter your revenue — the item price or total sales.
- 2Enter your total cost of goods.
- 3See profit, margin and markup update instantly.
- 4Adjust the price until you hit the margin you want.
Examples
Product pricing
Price $50, cost $30 → $20 profit, a 40% margin and a 66.7% markup.
Margin vs markup
Price $100, cost $75 → 25% margin but 33.3% markup — margin is always the smaller figure.
Common questions
What is the difference between margin and markup?
Margin is profit as a share of the selling price; markup is profit as a share of the cost. A 50% markup equals a 33.3% margin.
What is a good profit margin?
It varies enormously by industry — groceries run 2–5% while software often exceeds 70%. Compare against businesses like yours, not a universal number.
Is this gross or net margin?
Gross: it uses only the cost of goods sold. Overhead, salaries, taxes and shipping are excluded, so net margin will be lower.
