Profit Margin Calculator
Calculate profit margin, markup and the selling price you need to hit a target margin.
What the Profit Margin Calculator does
Margin measures profit against the selling price; markup measures the same profit against cost. A 50% markup gives only a 33% margin — mixing them up is one of the most common and expensive pricing mistakes.
Formula
Profit = Price − CostMargin % = Profit ÷ Price × 100Markup % = Profit ÷ Cost × 100Price for target margin = Cost ÷ (1 − margin)
Inputs explained
| Input | Unit | Required | Notes |
|---|---|---|---|
| Cost | selected currency | Yes | Accepts more than 0. |
| Selling price | selected currency | Optional | Leave blank if you are setting a target margin instead. Accepts 0 or more. |
| Target margin | % | Optional | Fill this in to find the required selling price. |
| Currency | one of 10 options | Optional | — |
How to use it
- Choose Currency.
- Enter Cost.
- Optionally add Selling price and Target margin.
- Select Calculate.
Worked example
An item costs $60 and sells for $100.
- Cost
- 60
- Price
- 100
Profit $40, margin 40%, markup 66.67%.
Frequently asked questions
What is the difference between margin and markup?
The denominator. Margin divides profit by price, markup divides it by cost. A 100% markup is a 50% margin.
How do I price for a 40% margin?
Divide cost by 0.60. A $60 cost needs a $100 price. Do not add 40% to cost — that gives only a 28.6% margin.