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Profit Margin Calculator

Calculate profit, profit margin, and markup from cost and sale price, with a clear margin vs markup explainer.

Results update instantly.Change any value and the estimate recalculates on the spot.

Money

Profit margin

Get profit, margin, and markup from cost and sale price in one step.

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$

Profit per item

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  • Profit margin-
  • Markup-

Margin is profit as a share of the sale price; markup is profit as a share of cost. The same sale always shows a higher markup than margin.

How to use this calculator

1. Enter what one item costs you. 2. Enter the price you sell it for. 3. Read the profit, the margin, and the markup.

Worked example

Cost $60, price $100: profit is $40.00, margin is 40.00% (40/100), and markup is 66.67% (40/60).

How the math works

Profit = price - cost. Margin = profit / price, which answers "what share of each sale do I keep?" Markup = profit / cost, which answers "how much do I add on top of cost?" Because price is bigger than cost, markup is always the larger number.

What is the difference between margin and markup?
Margin divides profit by the sale price; markup divides profit by the cost. A 40% margin on a $100 sale equals a 66.67% markup on a $60 cost - same profit, different base.
Which one should I use for pricing?
Use margin when you think in terms of keeping a share of revenue, which is how most businesses set targets. Use markup when you build prices up from cost.
Can margin be over 100%?
No. Margin tops out just under 100% because profit can never exceed the sale price. Markup has no ceiling.
What is a good profit margin?
It depends on the industry. Grocery stores run thin single-digit margins; software can exceed 70%. Compare against competitors, not against a universal number.

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How it works

How the Profit Margin Calculator works

Quick answer: An item that costs $60 and sells for $100 has a 40.00% profit margin and a 66.67% markup. Margin divides profit by price; markup divides profit by cost.

Formula

Profit = price − cost
Margin = profit ÷ price × 100
Markup = profit ÷ cost × 100

Margin can never reach 100%; markup can be any size.

Worked example

Cost $60, price $100: profit $40.00, margin 40.00%, markup 66.67%.

Cost $60

Sale priceMarginMarkup
$7520.00%25.00%Open
$9033.33%50.00%Open
$10040.00%66.67%Open
$12050.00%100.00%Open
$15060.00%150.00%Open

Assumptions and limits

  • Uses per-item cost; overhead, shipping, and fees are not included unless added to cost.

Frequently asked questions

What is the difference between margin and markup?

Margin divides profit by the sale price; markup divides profit by the cost. A 40% margin on a $100 sale equals a 66.67% markup on a $60 cost - same profit, different base.

Which one should I use for pricing?

Use margin when you think in terms of keeping a share of revenue, which is how most businesses set targets. Use markup when you build prices up from cost.

Can margin be over 100%?

No. Margin tops out just under 100% because profit can never exceed the sale price. Markup has no ceiling.

What is a good profit margin?

It depends on the industry. Grocery stores run thin single-digit margins; software can exceed 70%. Compare against competitors, not against a universal number.

What markup gives a 50% margin?

A 100% markup: doubling the cost gives a price where half is profit.

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