Profit Margin Calculator (Advanced)
Profit margin = (Selling Price - Cost) / Selling Price × 100. Markup = (Selling Price - Cost) / Cost × 100. To find selling price from cost and margin: Price = Cost / (1 - Margin%). For example, 40% margin on $60 cost: $60 / 0.60 = $100. Margin is always lower than markup for the same profit because margin uses price as the denominator.
Advanced profit margin calculator with three modes: calculate margin from cost and price, find selling price from cost and target margin, or determine maximum cost from price and margin. Compare multiple products side by side, visualize margin breakdowns, calculate net margins with operating expenses, and reference industry benchmarks.
Works OfflineDark ModeNo Ads
Calculation Mode
Enter Values
Net Margin Mode
Product Comparison
Industry Benchmarks
How to Use
- Enter your value in the input field
- Click the Calculate/Convert button
- Copy the result to your clipboard
Frequently Asked Questions
- What is the difference between gross margin and net margin?
- Gross margin = (Revenue - Cost of Goods) / Revenue × 100. It only accounts for direct production costs. Net margin = (Revenue - All Expenses) / Revenue × 100. It subtracts operating expenses, taxes, interest, and other costs. A business can have high gross margins but low net margins if operating expenses are high.
- How do I calculate selling price from a target margin?
- Selling Price = Cost / (1 - Margin%). For 40% margin on a $60 cost: Price = $60 / (1 - 0.40) = $60 / 0.60 = $100. Verify: ($100 - $60) / $100 = 40%. Common mistake: adding the margin percentage to cost gives markup, not margin.
- Why is markup always higher than margin for the same profit?
- Margin uses selling price as the denominator; markup uses cost. Since cost < selling price, dividing by the smaller number (cost) gives a larger percentage. Example: $40 profit on $100 sale = 40% margin. Same $40 profit on $60 cost = 66.7% markup.
- What is a good profit margin for my industry?
- It varies widely. Software/SaaS: 70-85% gross, 20-30% net. Retail: 25-35% gross, 2-5% net. Restaurants: 55-65% gross, 3-9% net. E-commerce: 40-60% gross, 5-15% net. Use the Industry Benchmarks section in this tool for more references. Always compare within your specific industry.
- How can I use the product comparison feature?
- Enable "Compare multiple products" to add products with their cost and selling prices. The tool calculates margin, markup, and profit for each, displays visual margin bars, and shows a summary table. Useful for comparing product lines, pricing strategies, or supplier options side by side.