Pricing & Profit
Profit Margin Calculator
Calculate profit, profit margin, and markup from your cost and selling price.
Enter your cost and selling price to see how much profit you make and what percentage of each sale you keep.
Enter your values
Your total cost for one item or service.
The amount charged to your customer.
Results
Profit margin
—
Enter your cost and selling price to calculate margin.
Profit
—
Selling price less cost.
Markup
—
Profit expressed as a percentage of cost.
Results are estimates based on the values entered and are provided for general planning.
Method
How to calculate profit margin
Profit margin shows how much of each revenue dollar remains after the cost entered above. Markup compares that same profit with cost instead of revenue.
Formula
Profit = Selling price − Cost Profit margin = Profit ÷ Selling price × 100 Markup = Profit ÷ Cost × 100
Assumptions
- Cost and selling price cover the same unit and period.
- Selling price must be greater than zero; a zero cost has no conventional markup.
- The calculator uses only the cost and selling price entered. Include tax, shipping, payment fees, labor, advertising, overhead, or other operating expenses when you want them reflected.
Calculations retain full JavaScript numeric precision. Currency and percentages display two decimals.
How to interpret the result
A positive margin means price exceeds cost. A zero margin means price equals cost. A negative margin means the item is being sold below the entered cost.
Profit margin formula
Profit margin is the percentage of selling price left after subtracting the cost entered in the calculator. For example, a 25% margin means $25 remains from each $100 of revenue before costs that were not included.
When you enter direct product or service cost, this calculator gives gross profit and gross profit margin. Operating margin and net profit margin use broader income-statement figures, so they require different inputs.
What is a good profit margin?
There is no universal good profit margin. An appropriate margin varies by industry, product, business model, overhead, sales volume, and competitive environment.
Use margin to compare products or periods only when costs are defined consistently. A higher margin is not automatically better if it reduces demand, while a lower margin may be sustainable when volume and operating costs support it.
Profit margin vs. markup
Profit margin compares profit with selling price. Markup compares profit with cost. For a $75 cost and $120 selling price, $45 profit equals a 37.50% margin and a 60.00% markup.
| Measure | Formula | What it shows |
|---|---|---|
| Profit | Selling price − Cost | The currency amount left after the entered cost. |
| Profit margin | Profit ÷ Selling price × 100 | Profit as a percentage of revenue. |
| Markup | Profit ÷ Cost × 100 | Profit as a percentage of cost. |
Frequently asked questions
Keep calculating
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