Calculate profit margin, markup percentage, and gross profit instantly. Enter cost and revenue, or work backwards from your target margin.
Profit margin measures what percentage of revenue is actual profit. It's calculated as: Margin = ((Revenue - Cost) / Revenue) × 100. A 50% margin means half of every dollar in sales is profit.
Margin and markup both measure profitability, but they use different bases:
For example, if an item costs $60 and sells for $100: the margin is 40% (profit is 40% of revenue) but the markup is 66.7% (profit is 66.7% of cost).
| Margin | Markup | Multiplier |
|---|---|---|
| 10% | 11.1% | 1.11x |
| 20% | 25% | 1.25x |
| 25% | 33.3% | 1.33x |
| 30% | 42.9% | 1.43x |
| 40% | 66.7% | 1.67x |
| 50% | 100% | 2.00x |
| 60% | 150% | 2.50x |
| 75% | 300% | 4.00x |
To calculate margin, use this formula: Margin % = ((Selling Price - Cost) / Selling Price) × 100. Enter your cost and selling price above, and the calculator will show your margin, markup, profit, and multiplier instantly.
Good margins vary by industry. Retail typically aims for 25-50% margin, while software companies often achieve 60-80%. Service businesses usually target 15-30%. The key is to cover all operating expenses while remaining competitive in your market.
Our calculator handles this conversion automatically. Enter any two values and the others are calculated instantly.