Profit Margin Calculator
Enter what something costs you and what you sell it for, and see your profit, margin, and markup in an instant.
Calculate your profit margin
Profit margin is profit divided by selling price, shown as a percentage.
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How the profit margin calculator works
Two numbers in, three answers out.
Enter your cost
Type the total cost of producing or buying the item, including materials and direct expenses.
Enter your selling price
Add the price you charge the customer before any taxes are applied.
Read your results
See your profit in dollars plus your margin and markup as clear percentages.
Frequently Asked Questions
Common questions about profit margin, markup, and pricing.
Profit margin is the share of your selling price that you keep as profit after covering the cost. You calculate it by dividing profit by the selling price and multiplying by 100. A higher margin means more of each sale stays in your business.
Margin is profit as a percentage of the selling price, while markup is profit as a percentage of the cost. The same dollar profit gives a smaller margin than markup. For example, a 50 percent markup equals a 33 percent margin.
It depends on your industry. Retail margins are often thin at 5 to 10 percent, while service and software businesses can reach 50 percent or more. Compare your margin to others in your field rather than to a single fixed number.
You can raise prices, lower your costs, or shift your sales toward higher-margin products and services. Even small price increases can lift margin sharply because the extra amount is nearly all profit.
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