Profit Margin Calculator
Enter your product cost and selling price, and we will compute your unit profit, profit margin percentage and markup percentage. Make pricing decisions in seconds.
Frequently Asked Questions About Profit Margin
What is profit margin?
Profit margin is the percentage that shows how much of the selling price is profit. It summarizes how much a business earns on each sale.
How is profit margin calculated?
Profit margin = (Selling price − Cost) ÷ Selling price × 100. It expresses profit as a percentage of the selling price.
Margin vs markup — what is the difference?
Margin compares profit to the selling price; markup compares profit to the cost. For the same profit, markup always looks higher than margin.
How do I price for a target margin?
Selling price = Cost ÷ (1 − Target margin). For a 100 cost at a 40% target margin, the price is 166.67.
What is a good profit margin?
It varies by industry. Retail may run 5–10% while digital products can exceed 70%. What matters is covering all costs and leaving a sustainable profit.
Gross vs net margin — what is the difference?
Gross margin subtracts only product cost; net margin also subtracts ads, shipping, taxes and other expenses. This tool calculates gross margin.