acalculator

What is my profit margin?

Enter what an item costs you and what you sell it for to see your profit margin and markup. Or enter a cost and a target margin to get the selling price.

Your numbers

Profit margin
25%

Selling for $120.00 at a cost of $90.00 is a profit of $30.00: a 25% margin and a 33.33% markup.

Profit
$30.00
Markup
33.33%

Profit margin: 25%. Selling for $120.00 at a cost of $90.00 is a profit of $30.00: a 25% margin and a 33.33% markup.

The results are estimates for information only. They are not financial, tax, or legal advice. Check the numbers with your lender or a qualified professional before you decide. Terms of use

How to calculate

Computes the profit margin (profit as a percent of the selling price) and the markup from any two of cost, selling price, profit and margin.

Example with the default inputs (Selling price $120.00, Cost $90.00): Selling for $120.00 at a cost of $90.00 is a profit of $30.00: a 25% margin and a 33.33% markup.

Formula: M = P ÷ R × 100, where P = R − C. C is the cost, R the selling price, P the profit and M the margin.

  • The cost and the selling price are more than 0.
  • The margin is a percent of the revenue (the selling price); the markup is a percent of the cost.
  • A loss gives a negative profit and a negative margin. Margins run from −1,000% (a cost 11 times the revenue) to just under 100%; numbers outside that range, or that need a cost or revenue of 0 or less, have no answer.

Machine-readable copies: Markdown, JSON.

Worked examples

Each example is checked against the calculator on every build.

  1. Cost $70.00, Selling price $100.00 gives Profit $30.00, Margin 30%, Markup 42.857143%.Source: hand calculation in content.mdx: 100 − 70 = 30; 30 ÷ 100 × 100 = 30%; 30 ÷ 70 × 100 = 42.86%
  2. Cost $60.00, Margin 25% gives Selling price $80.00, Profit $20.00, Markup 33.333333%.Source: hand calculation in content.mdx: 60 ÷ (1 − 0.25) = 80; 80 − 60 = 20; 20 ÷ 60 × 100 = 33.33%
  3. Selling price $250.00, Margin 40% gives Profit $100.00, Cost $150.00, Markup 66.666667%.Source: hand calculation in content.mdx: 250 × 0.40 = 100; 250 − 100 = 150; 100 ÷ 150 × 100 = 66.67%
  4. Cost $120.00, Selling price $100.00 gives Profit -$20.00, Margin -20%, Markup -16.666667%.Source: hand calculation in content.mdx: a loss: 100 − 120 = −20; −20 ÷ 100 × 100 = −20%

How margin is worked out

  • profit: P = R − C
  • margin: M = P ÷ R × 100
  • markup: P ÷ C × 100

C is the cost, R the selling price (the revenue from the sale), P the profit, and M the margin in percent. The margin is a share of the selling price; the markup is a share of the cost.

Fill in any two of cost, selling price, profit and margin. The calculator finds the other two, and the markup, from these rearrangements:

  • R = C ÷ (1 − M ÷ 100) and C = R × (1 − M ÷ 100)
  • R = P ÷ (M ÷ 100) and P = M ÷ 100 × R
  • C = R − P and R = P + C

Assumptions

  • The cost and the selling price are more than $0.
  • A loss gives a negative profit, margin and markup.
  • The margin is from −1,000% (a cost 11 times the price) to just under 100%. Numbers outside that range, or that need a cost or a price of $0 or less, have no answer.
  • Tax, shipping and overheads are not included unless you add them to the cost.

Limits

Cost and selling price are more than $0 and at most $1,000,000,000,000; profit is from −$1,000,000,000,000 to $1,000,000,000,000; the margin from −1,000% to just under 100%. A solved value outside these limits has no answer.

Worked examples by hand

Bought for $70, sold for $100. Profit = 100 − 70 = $30. Margin = 30 ÷ 100 × 100 = 30%. Markup = 30 ÷ 70 × 100 = 42.86%.

A 25% margin on a $60 cost. Price = 60 ÷ (1 − 0.25) = 60 ÷ 0.75 = $80. Profit = 80 − 60 = $20. Markup = 20 ÷ 60 × 100 = 33.33%.

A 40% margin at a $250 price. Profit = 250 × 0.40 = $100. Cost = 250 − 100 = $150. Markup = 100 ÷ 150 × 100 = 66.67%.

Sold at a loss: cost $120, price $100. Profit = 100 − 120 = −$20. Margin = −20 ÷ 100 × 100 = −20%. Markup = −20 ÷ 120 × 100 = −16.67%.

Other questions people ask

How do I calculate profit margin?

Subtract the cost from the selling price to get the profit, then divide the profit by the selling price and multiply by 100. An item bought for $70 and sold for $100 makes $30 profit, a 30 ÷ 100 × 100 = 30% margin.

What is the difference between margin and markup?

Both use the same profit. Margin divides it by the selling price; markup divides it by the cost. The $30 profit on a $70 item sold for $100 is a 30% margin but a 30 ÷ 70 × 100 = 42.86% markup. With a profit, the markup is always larger than the margin.

What price gives me the margin I want?

Divide the cost by (1 − margin ÷ 100). For a 25% margin on a $60 cost, the price is 60 ÷ 0.75 = $80. Adding 25% to the cost ($75) gives only a 20% margin, a common mistake.

Can a margin be more than 100%?

No. A margin is the share of the selling price that is profit, so it stays below 100% while the cost is above $0. A markup has no upper limit.

What does a negative margin mean?

You sold for less than the cost, so the profit is a loss. Selling a $120 item for $100 loses $20, a −20% margin.

Is this the same as a gross margin?

The maths is the same. Gross margin uses a business's whole revenue and its cost of goods sold, so it is used for a company or product line rather than one item. See the gross margin calculator.