Profit Margin Calculator
🏠 Free ToolCalculate gross profit margin, markup percentage, and profit amount from your revenue and cost. Visualize the revenue breakdown and reference the margin-to-markup conversion table.
| Margin | Markup |
|---|---|
| 10% | 11.1% |
| 20% | 25.0% |
| 25% | 33.3% |
| 30% | 42.9% |
| 40% | 66.7% |
| 50% | 100.0% |
How it Works
The profit margin calculator helps business owners, freelancers, and entrepreneurs understand their profitability at a glance. Enter your revenue and cost to instantly see your gross margin percentage, markup percentage, and absolute profit amount.
The visual breakdown bar shows what proportion of your revenue goes to costs versus profit, making it immediately clear how efficient your pricing is. This is especially useful when evaluating whether to adjust your prices or reduce costs.
A key feature is the margin vs markup reference table, which shows how common margin percentages translate to markup percentages and vice versa. Many business owners confuse these two metrics, leading to pricing errors.
Whether you are pricing a product, evaluating a business opportunity, or preparing financial reports, this calculator gives you the essential profitability metrics you need in seconds.
Frequently Asked Questions
What is the difference between margin and markup?
Margin is profit as a percentage of revenue (selling price). Markup is profit as a percentage of cost. A 50% markup equals a 33.3% margin. They describe the same profit from different perspectives.
How do I calculate gross margin?
Gross margin = ((Revenue - Cost) / Revenue) × 100. For example, if you sell for 100 EUR and the cost is 60 EUR, your margin is (40/100) × 100 = 40%.
How do I calculate markup?
Markup = ((Revenue - Cost) / Cost) × 100. Using the same example: (40/60) × 100 = 66.7% markup.
What is a good profit margin?
It varies by industry. Retail typically sees 25-50% gross margin, software 70-90%, restaurants 60-70% gross but 3-9% net. Compare within your industry for meaningful benchmarks.
How do I convert between margin and markup?
Margin to markup: Markup = Margin / (1 - Margin). Markup to margin: Margin = Markup / (1 + Markup). The calculator's reference table shows common conversions.
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