Free profit margin calculator
Enter what an item costs you and what you sell it for to get the profit, the margin and the markup. Or enter your cost and a target to find the price to charge.
- Profit per item40.00
- Margin (profit ÷ price)40%
- Markup (profit ÷ cost)66.67%
Margin and markup are different: a 50% markup is only a 33% margin. Ask for the one your supplier or accountant means.
Free, no sign-up, nothing to install.
Margin and markup are not the same
Profit is the selling price minus the cost. Margin is the profit as a share of the selling price, and markup is the profit as a share of the cost. An item that costs 60 and sells for 100 has a profit of 40, a margin of 40% and a markup of 66.7%. Mixing the two up is one of the most common pricing mistakes: a 50% markup is only a 33% margin.
Work out your cost carefully: include the item, packaging, delivery, payment fees and a share of the time it takes you. Then choose the margin you need to cover your rent and pay yourself, and use the What to charge mode to find the price that delivers it.
How to work out your margin or your price
- Choose My margin to check a price you already use, or What to charge to find a price.
- Type your cost per item, and either the selling price or the margin or markup you want.
- Read the profit, the margin, the markup and the price to charge.
Questions people ask
How do I calculate profit margin?
Subtract the cost from the price to get the profit, then divide the profit by the price and multiply by 100. For cost 60 and price 100: 40 / 100 = 40%.
What is the difference between margin and markup?
Margin divides the profit by the selling price; markup divides it by the cost. The same sale gives a smaller margin than markup.
How do I price something to get a 40% margin?
Divide the cost by 0.6 (one minus 0.4). A cost of 60 needs a price of 100.
What is a good profit margin?
It depends on the business. Shops often run on 30 to 50% margins and services on more. What matters is that it covers your costs and pays you.