Profit Margin Calculator
Work out your profit margin in seconds. Enter the cost and the selling price (revenue) to see profit, margin percentage and markup percentage side by side.
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Save ⟶How to use the Profit Margin Calculator
- 1Enter cost in the form on the left.
- 2Fill in the remaining fields — the result updates automatically as you type.
- 3Review the highlighted result and the supporting breakdown on the right.
- 4Use Copy, Share or Print to save or send your result.
Margin vs. markup — don't mix them up
Margin is profit as a percentage of the selling price; markup is profit as a percentage of cost. A product bought for $60 and sold for $100 has a 40% margin but a 66.7% markup. Pricing with the wrong one is one of the most common small-business mistakes.
To hit a target margin m, price = cost ÷ (1 − m). For a 40% margin on a $60 cost: 60 ÷ 0.6 = $100. Multiplying cost by 1.4 would give only a 28.6% margin.
What is a good profit margin?
Healthy margins vary hugely by industry: grocery retail runs on 1–3% net margins, restaurants 3–9%, software often 70%+ gross. Compare against your sector, and watch gross margin trends over time — shrinking margins usually signal rising costs or pricing pressure before profits visibly fall.
Frequently Asked Questions
▸How do I calculate profit margin?
Margin % = (Revenue − Cost) ÷ Revenue × 100. Selling at $100 with a $60 cost gives (100−60)/100 = 40% margin.
▸What's the difference between gross and net margin?
Gross margin subtracts only the direct cost of goods. Net margin subtracts all expenses — overhead, salaries, taxes — and is always lower.
▸How do I price for a target margin?
Divide cost by (1 − target margin). For 30% margin on a $70 cost: 70 ÷ 0.7 = $100 selling price.