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Profit Margin
Revenue, cost, profit and markup %
Profit Margin
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Gross Profit
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Margin %
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Markup %
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❓ FAQs
How does this calculator work?▼
Enter the required values and click Calculate. Results appear instantly using standard financial formulas.
Is this free?▼
Yes, completely free. No login or signup required.
Are calculations accurate?▼
Yes, industry-standard formulas. For large decisions, consult a financial advisor.
📊 What is the Profit Margin Calculator and How Does It Work?
Profit margin calculates profitability as a percentage of revenue. Gross margin excludes operating costs; net margin includes all costs. This calculator handles both, plus markup (profit as percentage of cost).
Formula
Gross Margin% = (Revenue – COGS) / Revenue × 100 | Markup% = (Revenue – Cost) / Cost × 100 | Net Margin% = Net Profit / Revenue × 100🪓 Step-by-Step: How to Use This Calculator
- Enter selling price or total revenue
- Enter cost of goods or total costs
- Click Calculate to see profit, margin percentage, and markup percentage
📌 Example Calculation
Selling price ₹1,250, cost ₹1,000: Profit = ₹250. Gross margin = 20%. Markup = 25%. Note: margin and markup give different percentages for the same transaction.
✅ Benefits of Using This Calculator
- Calculate exact profit margin for any product
- Distinguish between margin and markup correctly
- Set prices to achieve your target profit margin
- Compare profitability across product lines
- Understand gross vs net margin difference
- Price services correctly based on time and costs
⚙️ Key Factors That Affect Results
- Selling price or revenue
- Cost of goods sold (COGS)
- Operating expenses for net margin calculation
- Variable vs fixed cost classification
- Sales volume — affects per-unit fixed cost absorption
- Competitive pricing pressure in your market
❓ Frequently Asked Questions
What is the difference between margin and markup?▼
Margin = profit as % of selling price. Markup = profit as % of cost. At ₹100 cost, ₹125 sale: margin = 20%, markup = 25%.
What is a good profit margin?▼
Varies by industry. FMCG: 5–15%. Software/SaaS: 60–80%. Restaurants: 3–9%. Manufacturing: 10–20%. Retail: 1–5% net.
How to set price using margin?▼
Selling price = Cost ÷ (1 – desired margin%). For 30% margin on ₹700 cost: ₹700 ÷ 0.70 = ₹1,000 selling price.
Gross or net margin — which matters more?▼
Gross shows production efficiency. Net shows total business efficiency. Investors look at net; operations teams track gross.
What is break-even point?▼
Revenue where total costs equal total revenue — zero profit. Units = Fixed costs ÷ (Selling price – Variable cost per unit).