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How to Use Profit Margin Calculator

Calculate gross profit, profit margin and markup from cost and selling price, for one item or a whole order. Free profit margin calculator for sellers.

About this tool

The profit margin calculator shows how much you make on a sale. Enter what an item costs you and the price you sell it for, and it calculates the profit, the profit margin (profit as a share of the price) and the markup (profit as a share of the cost). Add a quantity to see the total revenue, cost and profit of an order.

How to use Profit Margin Calculator

  1. Enter the cost per item and the selling price per item.
  2. Enter how many items you sell.
  3. Read the profit, margin and markup, and compare them with your targets.

Worked example

Buying a product for $60 and selling it for $100 earns $40 profit. That is a 40% margin and a 66.7% markup.

What is the difference between margin and markup?

Margin is profit divided by the selling price; markup is profit divided by the cost. The same sale has a higher markup than margin: a 50% markup equals a 33.3% margin.

What is a good profit margin?

It varies by industry. Grocery retailers often work on low single-digit net margins, while software and services can have much higher margins.

Is this gross or net profit?

Gross profit: price minus the cost of the goods. Net profit also subtracts overheads like rent, salaries, marketing and taxes.

Put this guide into practice

Explore Financial Calculators · More practical guides

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