Profit Margin Calculator
Enter the cost and selling price to see the profit, the profit margin and the markup, which are not the same thing. Or find the price that gives the margin you want.
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Profit, margin and markup
Price for a target margin
Results are calculations, not financial or tax advice. Taxes, fees and discounts aren’t included.
How do I calculate profit margin?
Profit margin is profit divided by the selling price; markup is profit divided by the cost. Buying at 80 and selling at 100 makes a profit of 20, which is a 20% margin but a 25% markup. Enter your cost and selling price to see all three, or enter a target margin to get the price you need.
- Enter what the item costs you and the price you sell it for.
- Read the profit, the profit margin and the markup. A price below cost is shown as a loss.
- To set a price, enter the cost and the margin you want under “Price for a target margin”.
Want to understand gross vs net margin, or how discounts affect your margin? Read our guide: Profit Margin vs Markup: How to Calculate Both
Formulas & Methods
Profit
Example: 100 − 80 = 20
Profit margin
Example: 20 ÷ 100 × 100 = 20%
Markup
Example: 20 ÷ 80 × 100 = 25%
Price for a target margin
Example: 80 ÷ (1 − 0.20) = 100
Key features
Margin and markup side by side
See both percentages at once, so you never mix them up in a price list or quote.
Price from a target margin
Enter a cost and the margin you want to get the selling price, with the profit and markup it gives.
Margin versus markup
Both describe the same profit, measured against different amounts. Margin compares it with the selling price, so it can never reach 100%. Markup compares it with the cost, so it can be any size: doubling the cost is a 100% markup but only a 50% margin.
Adding a 25% markup to a cost of 80 gives 100, a 20% margin. To reach a 25% margin instead, the price must be 80 ÷ 0.75 ≈ 106.67. The calculator shows both so you can quote the right one.
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Frequently Asked Questions
What is the difference between margin and markup?
Margin is profit as a percentage of the selling price. Markup is profit as a percentage of the cost. For the same sale the markup is always the larger number.
How do I work out a selling price from a margin?
Divide the cost by one minus the margin. For a 30% margin on a cost of 70: 70 ÷ 0.7 = 100.
Can a margin be over 100%?
No. The profit can’t be more than the selling price, so the margin is below 100% whenever the item cost something (exactly 100% only at a cost of 0). A markup can be over 100%.
Does this include tax or fees?
No. Enter the cost and price as you want them compared, for example both without VAT.
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