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Profit Margin Calculator

Mode

Enter cost and selling price to see margin, markup, and profit for each product.

Enter a cost and selling price to see margin, markup, and profit.

Margin and markup are the most confused numbers in pricing, and most calculators only do one product at a time. This one runs both directions across a whole list. In 'From price & cost' mode, enter each product's cost and selling price to see its margin, markup, and gross profit side by side. In 'From target margin' mode, enter a cost and the margin you want to hit, and the tool gives you the price to charge. Add as many products as you like to see a blended margin across the range, then export the table. Use it when setting prices, reviewing a supplier increase, or checking a whole catalogue at once.

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This calculator gives exact results from the numbers you enter. It does not include tax, shipping, payment fees, or other costs. Add all of your costs for an accurate picture. It is not financial advice.

How to use this tool

  1. 1Choose a mode: 'From price & cost' to measure existing prices, or 'From target margin' to work out the price you need for a margin goal.
  2. 2Enter the cost for each product - include materials, packaging, labour, delivery, and payment processing fees so the margin is real.
  3. 3Enter the selling price (price mode) or the target margin percentage (margin mode). Use a margin below 100%.
  4. 4Use '+ Add product' to compare several items at once and read the blended margin and markup across the list.
  5. 5Check the margin vs markup breakdown, then click Download CSV or Print to save the table.

Formula used

Gross profit = price - cost. Profit margin = (gross profit / price) x 100. Markup = (gross profit / cost) x 100. To hit a target margin m, required price = cost / (1 - m / 100), which only works for a margin below 100%. Blended margin uses total profit over total revenue across every product.

Example

From price & cost: price 100, cost 60

Gross profit is 40. Margin is 40% (40 / 100) and markup is 66.67% (40 / 60). The same 40 profit gives two different percentages depending on whether you measure against price or cost - which is why margin and markup are never equal.

From target margin: cost 60, target 45%

Switch to 'From target margin', enter cost 60 and margin 45. The tool returns a selling price of 109.09, a gross profit of 49.09, and a markup of 81.82%. Add a second product at cost 20 and the blended margin updates across both.

Common use cases

  • Pricing a new product to hit a 45% target margin and getting the exact price to charge
  • Checking a whole product range at once and seeing the blended margin across the catalogue
  • Comparing margin against markup so you do not undercharge by confusing the two
  • Reviewing a supplier price increase across several products and seeing the margin hit on each
  • Setting a minimum selling price for a promotion without dropping below a floor margin
  • Exporting a margin worksheet as CSV to share with a partner or accountant

Common mistakes

  • Not including all costs - cost must cover materials, packaging, delivery, payment fees, and labour time. Missing a cost gives a falsely high margin.
  • Confusing margin with markup - a 40% markup on a cost of 60 gives a margin of only 28.57%, not 40%. The breakdown shows both so you do not mix them up.
  • Setting a target margin of 100% or more in margin mode - you cannot reach a 100% margin because price would be infinite. Use a value below 100.
  • Using revenue before returns or refunds - if 10% of orders are returned, your effective revenue is lower. Account for this before relying on the figure.
  • Treating gross profit as net profit - this shows gross profit only. Rent, salaries, marketing, and taxes are separate and reduce your actual profit further.

Frequently asked questions

What is the difference between margin and markup?

Margin measures profit as a share of the selling price. Markup measures profit as a share of the cost. For the same product, markup is always the larger number. A 40% margin and a 40% markup result in very different prices and profits.

What is a good profit margin?

It depends heavily on your industry. Software and professional services often run 60-80% gross margins. Retail typically runs 20-50%. Manufacturing can be 10-30%. The right margin is one that covers all your operating costs and leaves enough net profit for the business to grow.

Does this include tax or payment fees?

No. It uses only the selling price and cost you enter. Payment processing fees (such as 2.9% + 30 cents on Stripe), marketplace fees, shipping, and tax are not factored in. Add all of these to your cost for an accurate real-world margin.

How do I find the price for a target margin?

Switch to 'From target margin' mode, enter your cost and the margin percentage you want, and the tool gives you the selling price. For a 45% margin on a cost of 60, the price is 109.09. This is the reverse of the price-and-cost mode and saves you guessing prices.

Can I compare several products at once?

Yes. Click '+ Add product' to add rows, and each gets its own margin, markup, and profit. The summary shows a blended margin and markup across the whole list, weighted by revenue, so you can sanity-check a full price range or catalogue in one pass. Download the table as CSV or print it.

What is gross profit?

Gross profit is revenue minus the direct cost of the product or service. It does not include operating expenses like rent, salaries, or marketing. Net profit subtracts those too. This calculator shows gross profit only.

Why does a higher markup not always mean a higher margin?

Because margin and markup use different denominators. A 100% markup doubles the cost, giving a 50% margin. A 400% markup on the same cost gives an 80% margin. As markup grows, margin approaches 100% but never reaches it.

How accurate is the result?

The result is exact for the numbers you enter. The accuracy of your margin depends entirely on how accurately you have calculated your costs. Underestimating costs is the most common source of error.

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