Profit Margin Calculator
Enter cost and selling price to get profit, profit margin %, and markup % — or work backwards from a target margin in your browser.
Profit
$40.00
Profit margin
40.00%
Markup
66.67%
Margin vs markup at $60.00 cost
| Margin | Price | Profit | Markup |
|---|---|---|---|
| 10% | $66.67 | $6.67 | 11.1% |
| 20% | $75.00 | $15.00 | 25.0% |
| 30% | $85.71 | $25.71 | 42.9% |
| 40% | $100.00 | $40.00 | 66.7% |
| 50% | $120.00 | $60.00 | 100.0% |
Margin is profit as a share of price; markup is profit as a share of cost — the same profit gives a higher markup than margin.
How to use Profit Margin Calculator
This profit margin and markup calculator turns cost and price into the numbers retailers and freelancers actually need: profit, profit margin and markup. Enter a cost and selling price to see all three at once, or work backwards from a target margin to find the price you must charge. Because margin and markup are easy to confuse, a built-in comparison shows how the same dollar of profit produces very different percentages depending on which one you quote.
- Choose whether to start from a known price or a target margin.
- Enter your unit cost.
- Enter the selling price, or enter the margin you want to hit.
- Read the profit, profit margin and markup percentages.
- Use the comparison table to see margin versus markup at the same cost.
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Margin versus markup: the key difference
Profit margin expresses profit as a percentage of the selling price, while markup expresses the same profit as a percentage of the cost. Because price is larger than cost, markup is always the higher number for a given profit. For example, $40 of profit on a $100 price is a 40% margin but a 66.7% markup. Confusing the two leads to underpricing, so always be clear about which measure a supplier or client is quoting.
| Margin | Markup | Price (on $60 cost) |
|---|---|---|
| 20% | 25% | $75.00 |
| 40% | 66.7% | $100.00 |
| 50% | 100% | $120.00 |
Pricing from a target margin
To hit a desired margin you cannot simply add that percentage to cost — that gives you a markup instead. The correct formula is price = cost ÷ (1 − margin). A 40% margin on a $60 cost needs a $100 price, because $40 profit is 40% of $100. This calculator does the algebra for you, so you can set the margin your business needs and read off the exact price to charge without accidentally leaving money on the table.
Worked examples
From price
Inputs: cost $60 · price $100
Result: $40 profit · 40% margin · 66.7% markup
From margin
Inputs: cost $60 · target 40%
Result: Price $100 required
Glossary
- Profit margin
- Profit as a percentage of the selling price.
- Markup
- Profit as a percentage of the cost.
- Gross profit
- Revenue minus the cost of goods sold.
- Cost of goods sold
- The direct cost of producing or buying the items you sell.
- Break-even price
- The price at which revenue exactly covers cost, giving zero profit.
Related reading
Frequently Asked Questions
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Why use Profit Margin Calculator?
- Transparent formulas so you understand every calculation
- Supports multiple currencies and regional tax rules
- Saves you from spreadsheet errors with validated inputs
- Shareable results for discussions with advisors or partners
Common use cases
- Calculate how long to pay off a credit card balance
- Model different mortgage scenarios before house hunting
- Forecast investment growth with compound interest
- Break even analysis for a new product or service
- Compare net salary after tax across different countries
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