Profit Margin Calculator

How it works

Profit margin measures how much of your selling price is actual profit. It is the profit divided by the revenue (the selling price), expressed as a percentage: sell for 100 at a cost of 60, and your 40 profit is a 40% margin. Margin is easy to confuse with markup, but they answer different questions. Markup is profit as a percentage of cost, while margin is profit as a percentage of price. The same 40 profit is a 40% margin but a 67% markup — so a '50% markup' is only a 33% margin. Margin matters because it tells you how much room you have: a thin margin means small cost increases or discounts can wipe out your profit, while a healthy margin gives resilience. Always know both your margin and your markup when you set prices.