Profit Margin Calculator

Use this calculator when you know your selling price and cost and want to see the resulting profit, margin, and markup. These percentages are often confused because margin compares profit with revenue while markup compares profit with cost. Seeing both values together makes it easier to check pricing assumptions before you factor in overhead, payment fees, taxes, shipping, or other expenses.

• profit margin vs markup
• Markup Calculator
• Small Business Pricing Math

Calculate profit, margin, and markup from cost and revenue

Profit margin and markup both describe profitability, but they answer different questions. This calculator shows the dollar profit as well as both percentages so you can compare them side by side.

Profit

Profit is revenue minus cost. If something costs $60 and sells for $100, the gross profit is $40.

Profit margin

Margin compares profit with the selling price:

margin = profit ÷ revenue × 100

With a $60 cost and $100 selling price, the margin is 40 ÷ 100 = 40%.

Markup

Markup compares profit with cost:

markup = profit ÷ cost × 100

Using the same numbers, the markup is 40 ÷ 60 = 66.67%.

Why the distinction matters

If someone says “we need 40%” without specifying margin or markup, the resulting selling price can be very different. A 40% markup on $60 gives a $84 selling price, while a 40% margin requires a $100 selling price.

What this does not calculate

The tool compares the cost and selling price you enter. It does not automatically account for overhead, labour, returns, taxes, payment processing, shipping subsidies, or other expenses unless you include them in your cost figure.