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Profit Margin Calculator

Margin or markup? Get both instantly. Enter cost and selling price to see profit, profit margin % and markup % — free calculator for sellers.

About this tool

Margin and markup are the two numbers every seller mixes up — and the mix-up is expensive. A 30% margin is not the same as a 30% markup, and pricing with the wrong one quietly eats your profit. This calculator gives you both, side by side, from just cost and selling price.

Freelancers quoting projects, shopkeepers pricing stock, and founders checking unit economics all use the same two inputs. Type them in, and the profit, margin percentage and markup percentage appear instantly.

How to use

Enter what the item costs you (materials, wholesale price, or project cost) and the price you sell it for. Press Calculate Margin to see the profit in dollars, the margin as a percentage of the selling price, and the markup as a percentage of the cost.

Use it in reverse too: nudge the selling price up and down to find the price that hits the margin you need.

The math behind it

Profit = Selling Price − Cost. Margin = Profit ÷ Selling Price × 100 (your cut of each sale). Markup = Profit ÷ Cost × 100 (how much you marked the cost up).

Example: cost $70, price $100 → profit $30, margin 30.00%, markup 42.86%. Same $30 profit, two very different percentages — which is exactly why the distinction matters.

Frequently asked questions

What is the difference between profit margin and markup?
Margin is profit as a percentage of the selling price — your cut of each sale. Markup is profit as a percentage of the cost — how much you marked it up. On a $70 cost sold for $100, the margin is 30% but the markup is 42.86%. Markup is always the bigger number.
What is a good profit margin?
It depends entirely on the industry. Grocery stores survive on 1–3%, restaurants target around 10%, and software companies can exceed 70%. Compare your margin to competitors in your own trade, not to businesses in unrelated industries.
Can profit margin be more than 100%?
No — margin is profit divided by selling price, so 100% would mean zero cost, the absolute ceiling. Markup, though, can pass 100% easily: sell a $20 item for $50 and the markup is 150%.
How do I price a product for a 40% margin?
Work backwards: Price = Cost ÷ (1 − margin). For a 40% margin on a $60 cost, price = 60 ÷ 0.60 = $100. Note that a 40% markup would only give $84 — pricing with the wrong formula is the classic mistake.
Why does my accountant’s margin differ from mine?
You are probably comparing different margins. Gross margin uses direct costs only; operating margin subtracts rent, salaries and overhead; net margin subtracts everything including taxes. This calculator gives gross margin — the starting point.

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