Profit Margin Calculator
Enter your cost and selling price to instantly calculate gross profit, margin percentage, and markup percentage — plus the selling price for any target margin.
📊 Your Results
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— margin · — markup
Gross Profit
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selling price minus cost
Profit Margin
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profit ÷ revenue
Markup
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profit ÷ cost
Price for Target Margin
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to hit your target margin
Markup ↔ Margin
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they describe the same deal
🎯 What this means
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📚 Want to price smarter and boost your margins?
📖 See top-rated pricing strategy books on Amazon →📌 5 Tips to Improve Your Profit Margins
- ✓ Know the margin-markup gap. A 50% markup is only a 33% margin. Many new business owners price at a “50% markup” and are surprised their margin is a third lower. Always price based on the margin you need, then translate to markup for your cost-plus quotes.
- ✓ Price for your target margin, not a round number. Use the target-margin price above. If you need a 40% margin on a $60 product, the price is $100 — not $90 (which is only 33% margin). Rounding down quietly erodes profitability.
- ✓ Review cost first, price second. A 5% cost reduction on a 40% margin product adds 3 percentage points to margin. Renegotiate suppliers, buy in bulk, or redesign packaging before raising prices — cost cuts flow straight to the bottom line.
- ✓ Benchmark against your industry. Grocery runs on 1–3% margins; software often 20–40%. A 15% margin is great for a distributor and terrible for a consultant. Compare to direct competitors, not a universal target, to know if you are underpricing.
- ✓ Track margin per product, not just average. A blended 30% margin can hide a star product at 60% subsidizing a loser at 5%. Cut or reprice the low-margin SKUs and your overall margin jumps without raising a single price.
Disclaimer: This calculator provides gross margin and markup estimates for educational purposes only. It uses a simple cost-and-price model and does not account for discounts, returns, volume tiers, or operating expenses. Not financial or business advice — consult a qualified accountant or financial advisor for decisions about your specific business.
Related Tools
Margin and markup are the foundation of pricing. These twelve business and finance calculators cover the rest of the picture — from the break-even point that your margin must cover, to overhead allocation, ROI, loan costs, late fees, printing overhead, markup, working capital, depreciation, and your overall financial health.
- Break-Even Calculator — your margin must be high enough to cover fixed costs; find the exact unit count where profit begins.
- ROI Calculator — margin tells you profit per sale; ROI tells you how hard each invested dollar is working overall.
- Freelancer Hourly Rate Calculator — for service businesses, your hourly rate IS your selling price; set it to hit your target margin after overhead.
- Discount Calculator — every sale discount erodes margin; see exactly how much a 10% or 20% markdown costs you.
- Financial Health Score Calculator — margin is one metric; this 10-factor score puts it in full financial context.
- Late Payment Interest Calculator — overdue invoices delay the margin you already earned; quantify the carrying cost of each late-paying account.
- Printing Cost Calculator — paper, ink, and setup costs are part of your cost base; factor them in to keep margins accurate.
- Overhead Cost Calculator — rent, utilities, and admin costs sit on top of every sale; allocate them correctly to know your true margin.
- Loan Payment Calculator — financing costs are a fixed expense that your margin must cover; model the impact on profitability.
- Markup Calculator — markup is the other side of the margin coin; calculate how much to add above cost to hit your target margin.
- Working Capital Calculator — margin means profit on paper; working capital means cash to operate. Check whether current assets cover current liabilities.
- Depreciation Calculator — depreciating assets reduce taxable margin over time; calculate straight-line, double-declining-balance, and sum-of-years’-digits in one place.