Margin Calculator
Calculate profit margins for products or services. Find selling prices, costs, and profit margins with this easy-to-use tool.
How it works: Enter any two values (cost, selling price, or margin percentage) and our calculator will automatically determine the third value for you.
Understanding Margin vs. Markup
Profit Margin
Profit margin is the percentage of revenue that is profit. It's calculated by dividing the profit by the selling price.
Formula:
Margin = (Selling Price - Cost) / Selling Price × 100%
Markup
Markup is the percentage of the cost that is added to get the selling price. It's calculated by dividing the profit by the cost.
Formula:
Markup = (Selling Price - Cost) / Cost × 100%
Common Margin Calculations
Finding Selling Price
If you know the cost and desired margin percentage:
Selling Price = Cost / (1 - (Margin Percentage / 100))
Finding Cost
If you know the selling price and desired margin percentage:
Cost = Selling Price × (1 - (Margin Percentage / 100))
Converting Markup to Margin
If you know the markup percentage:
Margin Percentage = (Markup Percentage / (100 + Markup Percentage)) × 100
Converting Margin to Markup
If you know the margin percentage:
Markup Percentage = (Margin Percentage / (100 - Margin Percentage)) × 100
Margin Calculator FAQs
What is a good profit margin?
A good profit margin varies by industry. Retail businesses typically have margins between 20-50%, while service businesses might have margins of 50-80%. Research your specific industry benchmarks.
How do I increase my profit margin?
You can increase profit margins by raising prices, reducing costs, increasing operational efficiency, or focusing on higher-margin products or services.
What's the difference between gross margin and net margin?
Gross margin is revenue minus the cost of goods sold, while net margin is revenue minus all expenses including operating costs, taxes, and interest.