Profit Margin
Calculate profit margin and markup from cost and selling price.
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Free Business Profit Calculator
Profit Margin Calculator for Business & Pricing
Calculate profit margin, gross profit, markup percentage, net margin and target selling price instantly.
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Profit margin
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Gross profit
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Markup percentage
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Target selling price
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Free Tool
Calculate Profit Margin
Choose a calculation mode below
Profit Margin from Cost & Selling Price
Enter your cost and selling price to calculate profit, margin and markup.
Selling Price from Target Margin
Enter cost and desired margin to calculate the required selling price.
Gross Profit Margin
Enter total revenue and cost of goods sold to calculate gross margin.
Net Profit Margin
Enter revenue and total expenses to calculate net profit margin.
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Browser-Based Calculation
Your calculations are performed directly in your browser. No account, registration or sign-up is required.
Four Calculation Modes
Calculate Different Types of Profit Margin
Use one calculator for pricing, profitability and business margin analysis.
Target Price
Find the selling price required for a desired profit margin.
Gross Margin
Compare revenue with cost of goods sold to find gross margin.
Net Margin
Calculate net profit and net margin from revenue and expenses.
Profit Formulas
How Profit Margin Is Calculated
Profit Margin Formula
Margin (%) = Profit รท Selling Price ร 100
Profit Formula
Profit = Selling Price โ Cost
Markup Formula
Markup (%) = Profit รท Cost ร 100
Target Selling Price
Price = Cost รท (1 โ Margin)
Profit Margin Guide
Free Online Profit Margin Calculator
Our free profit margin calculator helps businesses, online sellers, freelancers and entrepreneurs calculate profit, margin percentage, markup and selling price. You can also calculate gross profit margin from revenue and cost of goods sold or estimate net profit margin from total revenue and expenses.
Understanding profit margin can help with pricing, cost analysis and profitability reviews. However, the usefulness of any result depends on whether the relevant costs and expenses have been included consistently.
What Is Profit Margin?
Profit margin expresses profit as a percentage of selling price or revenue. For a simple product calculation, profit is the difference between selling price and cost.
For example, if a product costs 80 and sells for 100, the profit is 20. The profit margin is 20% because the 20 profit is divided by the 100 selling price.
Profit Margin vs Markup
Margin and markup both describe profit, but they use different bases. Profit margin divides profit by selling price or revenue. Markup divides profit by cost.
| Metric | Formula | Example |
|---|---|---|
| Profit | Price โ Cost | 100 โ 80 = 20 |
| Margin | Profit รท Price | 20 รท 100 = 20% |
| Markup | Profit รท Cost | 20 รท 80 = 25% |
How to Calculate Gross Profit Margin
Gross profit is calculated by subtracting cost of goods sold from revenue. Gross profit margin then expresses that gross profit as a percentage of revenue.
Gross Profit = Revenue โ COGS
Gross Margin (%) = Gross Profit รท Revenue ร 100
How to Calculate Net Profit Margin
Net profit margin compares net profit with revenue. In this calculator's simplified net margin mode, net profit is calculated as total revenue minus the total expenses entered.
Net Profit = Revenue โ Total Expenses
Net Margin (%) = Net Profit รท Revenue ร 100
How to Calculate Selling Price from Target Margin
If you know your cost and desired margin, the required selling price can be calculated by dividing cost by one minus the target margin expressed as a decimal.
Selling Price = Cost รท (1 โ Target Margin)
For example, a cost of 80 with a target margin of 20% requires a selling price of 100 because 80 divided by 0.80 equals 100.
Who Can Use a Profit Margin Calculator?
Profit margin calculations can be useful for retailers, e-commerce sellers, wholesalers, freelancers, agencies, service businesses, manufacturers and entrepreneurs. The exact cost inputs may differ depending on the business model.
Why Accurate Cost Inputs Matter
A margin calculation is only as useful as the values entered. Depending on your purpose, relevant costs may include purchase cost, manufacturing, packaging, shipping, transaction fees, platform charges, discounts or other expenses.
Gross margin and net margin also answer different questions. Gross margin generally focuses on revenue after direct cost of goods sold, while net margin reflects a broader measure after relevant total expenses.
Business & Financial Disclaimer
This calculator provides general estimates for informational and educational purposes only. It does not provide accounting, tax, investment or financial advice. Business costs, accounting treatment, taxes and profitability measures may vary. Verify important calculations and decisions with appropriate qualified professionals.
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FAQ
Frequently Asked Questions
Profit margin expresses profit as a
percentage of selling price or revenue.
Subtract cost from selling price to find
profit. Divide profit by selling price
and multiply by 100.
Margin divides profit by selling price
or revenue. Markup divides profit by cost.
Divide cost by one minus the target margin
expressed as a decimal. The target margin
must be below 100%.
Gross profit margin is gross profit divided
by revenue and multiplied by 100. Gross
profit is revenue minus cost of goods sold.