About Profit Margin Calculator
This free profit margin calculator lets you calculate gross profit margin percentage, markup percentage, and the optimal selling price from your cost and desired margin. Whether you are pricing a product, reviewing a project quote, or checking whether your current pricing is actually profitable, this tool gives you the numbers in seconds.
Profit margin and markup are related but different. Gross profit margin is profit as a percentage of the selling price: (Selling Price − Cost) ÷ Selling Price × 100. Markup is profit as a percentage of cost: (Selling Price − Cost) ÷ Cost × 100. A 50% markup produces a 33% margin - not the same thing. Confusing the two is one of the most common pricing mistakes in small business.
Enter your cost and desired profit margin percentage, and the calculator shows you the selling price that achieves that margin, along with the equivalent markup percentage and the gross profit amount. Or enter cost and selling price to see what margin and markup you are currently achieving.
This tool calculates gross profit margin - it does not account for operating expenses, taxes, or overhead beyond the direct cost you enter. For a full picture of profitability, you would also need to factor in your operating expense ratio and tax rate. But gross margin is the right starting point for pricing decisions at the product or service level.
If you know what margin you need to stay viable, this calculator makes it simple to set the right price rather than guessing and checking.