How to use the Profit Margin Calculator
- Pick a mode: check an existing price, or find the price for a target margin.
- Enter your cost per unit.
- Enter the selling price or the margin you want.
- Read profit, margin and markup.
Formula used
Worked examples
| Cost | Price | Profit | Margin | Markup |
|---|---|---|---|---|
| 80 | 100 | 20 | 20% | 25% |
| 50 | 75 | 25 | 33.33% | 50% |
| 12 | 20 | 8 | 40% | 66.67% |
Frequently asked questions
What is the difference between margin and markup?
Margin compares profit with the selling price. Markup compares profit with the cost. The same 20 profit on an 80 cost is a 20% margin but a 25% markup.
What is a good profit margin?
It depends on the industry. Grocery often runs on 1% to 5%, retail 20% to 50% gross, and software can exceed 70%.
How do I add a 30% margin to my cost?
Divide the cost by 0.7. A 70 cost needs a 100 price. Multiplying by 1.3 gives a 30% markup, which is only a 23% margin.
Should I include tax in the price?
Calculate margin on the price before VAT, GST or sales tax, because the tax is not your revenue.
Can margin be more than 100%?
No, margin is always below 100% unless the cost is zero. Markup can exceed 100%.
Our team builds and tests every tool by hand, checks each formula against official sources (IRS, HMRC, the Income Tax Department of India, CBSE, NHS, WHO) and reviews pages whenever rules change. Last reviewed on . Spotted a mistake? Tell us.