Profit Margin Calculator
Calculate profit margin
Calculate a product or service's profit and margin from its selling price and cost, along with its markup. Useful for setting prices and reviewing a business's profitability.
Calculate your profit margin
Result
Profit margin
40%
- Profit per unit
- €20.00
- Markup
- 66.67%
Formula version: 1.0.0
How to use the profit margin calculator
- Enter the selling price (excluding tax).
- Enter the cost of the product or service.
- Review the profit, margin and markup.
Profit margin formula
Margin = (price − cost) / price × 100 · Markup = (price − cost) / cost × 100
Margin is measured against price and markup against cost; that's why markup is always higher.
Profit margin example
If you sell for €50 something that costs you €30, you make €20: a 40% margin and a 66.67% markup.
Illustrative example with the data shown; not a guaranteed outcome.
Assumptions and limitations
- Price and cost excluding indirect taxes.
- Gross margin: overheads are not deducted.
Frequently asked questions
What's the difference between margin and markup?
Margin measures profit relative to the selling price; markup, relative to cost.
What's a good margin?
It depends on the sector: a supermarket and a software company have very different margins.
Related calculators
See basic finance calculatorsIndicative result for information only; not financial or tax advice. Read the legal notice · How we calculate results
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