Profit Margin & Markup Calculator

Calculate gross margin, markup and profit from cost and price, or find the selling price for a target margin or markup.

What do you know?

Cost per unit ($)

Selling price ($)

Other costs per unit, optional ($)

Cost is what one unit costs you (cost of goods sold). Add other per-unit costs to see a net margin as well as the gross margin.

Convert a percentage between margin and markup

Calculated entirely in your browser — nothing you enter here is sent to a server.

Margin vs markup

Both describe the same profit, measured against a different base. Margin divides profit by the selling price; markup divides it by the cost. That is why they never match: a product that costs $60 and sells for $100 has $40 of profit, a 40% margin ($40 ÷ $100) and a 66.67% markup ($40 ÷ $60).

Gross margin = (price − cost) ÷ price × 100
Markup = (price − cost) ÷ cost × 100
Price for a target margin = cost ÷ (1 − margin)
Markup = margin ÷ (1 − margin) and margin = markup ÷ (1 + markup)

Worked examples

Pricing for a target margin. A product costs $75 and you want a 25% margin. Adding 25% to the cost gives $93.75, which is only a 20% margin. The correct price is $75 ÷ (1 − 0.25) = $100. Choose "I know the cost and want a target margin" above to do this directly.

Gross vs net margin. At a $60 cost and $100 price, adding $15 of other per-unit costs (shipping, payment fees, packaging) drops the net profit to $25, so the net margin is 25% while the gross margin stays 40%.

Things to watch

A margin can never reach 100% unless the cost is zero, so the calculator rejects a target margin of 100% or more.
Markup is undefined when the cost is $0; the calculator says so instead of showing an infinite number.
A price below cost gives a negative margin and markup — the result is shown as a loss per unit.
For advertising, the margin you calculate here sets your break-even return on ad spend; see the break-even ROAS calculator.

Frequently asked questions

What is the difference between margin and markup?: Both use the same profit, but margin divides it by the selling price and markup divides it by the cost. Buying at 60 and selling at 80 is a 25% margin and a 33.33% markup.
How do I convert markup to margin?: Margin = markup ÷ (1 + markup). A 50% markup is a 33.33% margin. Going the other way, markup = margin ÷ (1 − margin), so a 25% margin needs a 33.33% markup.
Can profit margin be more than 100%?: Not while the product costs anything: the profit can never be larger than the selling price. Markup has no upper limit, because the price can be any multiple of the cost.
What is a good profit margin?: It varies widely by industry, business model and costs outside the product. Compare against your own history and businesses with a similar model rather than a single target.