📐 Profit Margin Calculator

A profit margin calculator helps you determine the true profitability of your products. Enter cost and selling price to get margin percentage, markup percentage, and profit amount. Or enter cost + desired margin to calculate the right selling price.

The most common pricing mistake is confusing markup with margin. If you want 40% profit margin, you cannot just add 40% to your cost. $60 cost + 40% = $84 price = only 28.6% margin, not 40%. Use our calculator to get it right every time.

Example: You buy a product for $80 and sell it for $100. Profit = $20. Margin = 20/100 = 20%. Markup = 20/80 = 25%. If you want 30% margin, price = $80/0.7 = $114.29. Run different scenarios before setting your final prices.

Profit margin analysis helps you decide which products to push, which to discount, and which to discontinue. A product with 5% margin needs 4× the volume of a 20% margin product to generate the same profit. Focus marketing on high-margin items.

Related: Use our VAT Calculator to add taxes to your margins. The Invoice Generator creates professional invoices with your calculated prices. Our Currency Converter helps if you source products internationally.

Business tip: Track gross margin by product category monthly. If margins are shrinking, investigate — rising costs, price pressure from competitors, or product mix shift. A 1% margin improvement at 10% net margin = 10% profit increase.