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 Margin | Markup Needed | Price at $60.00 Cost | Profit 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