Calculators
Profit Margin Calculator
Enter revenue and cost to get gross profit, profit margin percentage and markup percentage. Essential for pricing decisions, understanding unit economics, and comparing product lines.
About the Profit Margin Calculator
Enter the selling price and the cost of goods sold (COGS) to get gross profit, profit margin percentage and markup percentage. These three figures are the core of any pricing decision.
Margin vs. markup — what's the difference?
Profit margin is calculated as a percentage of revenue: (Profit ÷ Revenue) × 100. A 40% margin means £40 of every £100 of revenue is profit.
Markup is calculated as a percentage of cost: (Profit ÷ Cost) × 100. A 67% markup means you added £67 profit for every £100 you spent.
Both use the same profit figure; only the denominator differs. A 50% margin and a 100% markup both mean you doubled your money.
Frequently asked questions
What is the difference between profit margin and markup?
Profit margin is profit as a percentage of revenue: (Profit ÷ Revenue) × 100. Markup is profit as a percentage of cost: (Profit ÷ Cost) × 100. Both use the same profit figure, just different denominators. A 50% margin equals a 100% markup.
What is a good profit margin?
It varies widely by industry. Net margins for software are often 20–30%, retail is typically 2–5%, restaurants around 3–9%, and professional services 15–20%. Comparing against industry benchmarks is more meaningful than a single target number.