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.
Enter your values
Result
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.