Profit Margin Calculator Calculate Gross Profit Margin
Use this free profit margin calculator to calculate profit margin and gross profit margin from your cost and selling price. See profit, margin % and markup % instantly, or work backwards to the price you need. It is a profit margin calculator free to use, with no sign-up.
Your numbers at a glance
Quick answer: to calculate profit margin, use (selling price − cost) ÷ selling price × 100. An item that costs 50 and sells for 80 has a profit of 30, a margin of 37.5% and a markup of 60%.
How to Use the Profit Margin Calculator
This free profit margin calculator shows how much profit you make on a product and what percentage of the selling price that profit is. Enter your cost and selling price to get profit, margin % and markup % at once, or work backwards to find the price you need for a target margin or markup. It suits online stores, retailers, wholesalers, freelancers and anyone who prices products, and it runs in your browser with no sign-up, so you get a profit margin calculator free to use every time you price a product.
How to Calculate Profit Margin: Step by Step
- Choose a tab: Cost + price, Target margin or Target markup.
- Enter the cost per unit, which is everything it costs you to get one item ready to sell.
- Enter the selling price, the target margin % or the target markup %, depending on the tab.
- Change the quantity if you want total revenue, total cost and total profit.
- Read the result. It updates as you type.
Calculate Profit Margin from Cost and Selling Price
On the Cost + price tab the calculator works out profit = price − cost, margin = profit ÷ price and markup = profit ÷ cost. With a cost of 50 and a price of 80 you get a profit of 30, a margin of 37.5% and a markup of 60%.
Gross Profit Margin Calculator: Calculate Gross Profit Margin
This also works as a gross profit margin calculator. Enter your cost of goods sold (COGS) as the cost and your revenue as the selling price. Gross profit margin = (revenue − COGS) ÷ revenue × 100. It leaves out overheads such as rent, salaries and marketing, so it shows how profitable the product itself is. To calculate gross profit margin for a whole month, use total COGS and total revenue.
Find the Selling Price for a Target Profit Margin
Choose Target margin when you know the margin you want. The calculator uses price = cost ÷ (1 − margin). A cost of 50 and a 40% margin gives a selling price of 83.33. Margin must stay below 100%.
Find the Selling Price from a Markup Percentage
Choose Target markup to add a percentage on top of your cost. A cost of 50 and a 40% markup gives a price of 70, which is a 28.57% margin.
Margin vs Markup: What Is the Difference?
Margin is profit as a share of the selling price. Markup is profit as a share of the cost. They describe the same profit in different ways, so a 40% markup is not a 40% margin. Mixing them up is a common pricing mistake that leaves you with less profit than planned. See the chart further down for quick conversions.
Profit Margin Calculator for Ecommerce and Online Stores
For an online store, enter your total cost per unit, not just the supplier price. Add shipping, packaging, marketplace and payment fees, advertising and an allowance for returns. The margin you see is then your real profit share, and you can test prices before you list a product.
Why Use a Margin Calculator Before Setting a Price?
A price that looks profitable can hide thin margins once fees and shipping are counted. A margin calculator shows the real profit on each sale in seconds, helps you compare products, and lets you test discounts before you offer them. It also keeps your pricing consistent across a whole catalogue.
Tips for Accurate Margins
- Use the same currency for cost and price.
- Include every cost that belongs to one unit.
- Check whether a price already includes tax.
Profit Margin Formula and Example
Profit margin formulas
Profit = Selling price − CostMargin % = Profit ÷ Selling price × 100Markup % = Profit ÷ Cost × 100Gross profit margin % = (Revenue − COGS) ÷ Revenue × 100Worked example
Cost 50 and selling price 80: profit = 80 − 50 = 30. Margin = 30 ÷ 80 × 100 = 37.5%. Markup = 30 ÷ 50 × 100 = 60%. Selling 100 units gives a total profit of 3,000. Gross profit margin example: revenue 80,000 and COGS 50,000 give a gross profit of 30,000 and a gross profit margin of 37.5%.
Markup vs Margin Chart
Use this chart to convert a markup percentage into the margin it produces.
| Markup | Profit margin |
|---|---|
| 10% | 9.09% |
| 20% | 16.67% |
| 25% | 20.00% |
| 30% | 23.08% |
| 40% | 28.57% |
| 50% | 33.33% |
| 60% | 37.50% |
| 75% | 42.86% |
| 100% | 50.00% |
Profit Margin Calculator FAQ
How to calculate profit margin?
Subtract the cost from the selling price to get the profit, then divide the profit by the selling price and multiply by 100. A product that costs 50 and sells for 80 has a profit of 30 and a profit margin of 37.5%.
How do I calculate gross profit margin?
Gross profit margin = (Revenue − Cost of goods sold) ÷ Revenue × 100. Enter your COGS as the cost and your revenue as the selling price. For revenue of 80,000 and COGS of 50,000, gross profit is 30,000 and the gross profit margin is 37.5%.
Is this profit margin calculator free?
Yes. The profit margin calculator is free to use, needs no sign-up and has no limits. You can calculate profit margin, gross profit margin and markup as often as you like.
What is the profit margin formula?
Profit margin % = (Selling price − Cost) ÷ Selling price × 100. Gross profit is the selling price minus the cost, and the margin shows what share of each sale you keep as profit.
What is the difference between margin and markup?
Margin is profit as a percentage of the selling price. Markup is profit as a percentage of the cost. For the same product the markup is always larger than the margin, for example a 60% markup equals a 37.5% margin.
How do I calculate markup percentage?
Markup % = (Selling price − Cost) ÷ Cost × 100. If an item costs 50 and sells for 80, the markup is 30 ÷ 50 × 100 = 60%.
How do I find the selling price for a target profit margin?
Selling price = Cost ÷ (1 − margin %). For a cost of 50 and a 40% margin, the price is 50 ÷ 0.60 = 83.33. Use the Target margin tab to do this automatically.
How do I calculate the selling price from cost and markup?
Selling price = Cost × (1 + markup %). With a cost of 50 and a 40% markup, the price is 50 × 1.40 = 70. Use the Target markup tab for this.
What is a good profit margin?
There is no single good number. It depends on the industry, your fees and your competition. Work out your margin after all costs such as shipping, platform fees and advertising, and compare it with similar sellers.
What is the difference between gross profit margin and net profit margin?
Gross profit margin only subtracts the direct cost of the product. Net profit margin also subtracts other expenses such as rent, salaries, marketing and tax, so it is usually lower.
How do I calculate profit margin in Excel or Google Sheets?
Put the cost in A2 and the selling price in B2, then use =(B2-A2)/B2 and format the cell as a percentage. For markup use =(B2-A2)/A2.
Can a profit margin be more than 100%?
No. Margin is a share of the selling price, so it cannot reach 100% unless the cost is zero. Markup can be more than 100%, for example selling an item for three times its cost is a 200% markup.
How do I calculate profit margin for an online store?
Enter your total cost per unit, including the product, shipping, packaging, marketplace and payment fees, ads and expected returns. The margin you get is then the real profit share of each sale.
How do I convert markup to margin?
Margin % = Markup % ÷ (100 + Markup %) × 100. A 60% markup gives 60 ÷ 160 × 100 = 37.5% margin. The chart on this page shows common conversions.
Is my data saved or shared?
No. The calculation runs in your browser. The numbers you enter are not sent to or stored on our servers.
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