Profit Margin Calculator

Find gross margin, markup and the right selling price for your products

What do you want to find?

$
$

For total revenue and profit

Gross margin

40.00%

$40.00 profit on a $100.00 price and $60.00 cost · 66.67% markup

Profit per unit

$40.00

Gross margin

40.00%

profit ÷ price

Markup

66.67%

profit ÷ cost

Total profit on 100 units

$4,000

$10,000 revenue − $6,000 cost

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Margin and Markup Reference

Gross MarginMarkup NeededPrice at $60.00 CostProfit per Unit
10%11.1%$66.67$6.67
20%25.0%$75.00$15.00
25%33.3%$80.00$20.00
30%42.9%$85.71$25.71
40%66.7%$100.00$40.00
50%100.0%$120.00$60.00
60%150.0%$150.00$90.00
75%300.0%$240.00$180.00

Margin vs Markup

Margin and markup both describe profit, but against different bases. Margin divides profit by the selling price; markup divides it by the cost. The same sale always has a higher markup than margin, which is why confusing the two leads to underpricing.

The Formulas

Margin = (price − cost) ÷ price

Markup = (price − cost) ÷ cost

Price = cost ÷ (1 − margin)

Markup = margin ÷ (1 − margin), and margin = markup ÷ (1 + markup)

Pricing Tips

  • •Set prices from your target margin, not a habit markup
  • •Include shipping, fees and packaging in your cost per unit
  • •A 50% markup is only a 33% margin
  • •Compare your gross margin with others in your industry
  • •Check that margin still covers overhead to stay profitable

Frequently Asked Questions