Margin Calculator
Any country Currency-neutral arithmetic. Enter figures in your own currency; no country tax rules are applied.
Profit calculator for pricing: gross margin, net profit margin and markup from cost and price, or the price that hits a target margin, both percentages shown.
Educational estimate only. Not a lending decision. Your numbers stay in this browser.
Results
How to read this: the verdict describes how much room your numbers leave, not a decision or an offer. Change any input to see how much the result moves.
Assumptions and formula
Margin is profit divided by the selling price; markup is profit divided by the cost. To price for a margin the cost is divided by one minus the margin; to price by markup the cost is multiplied by one plus the markup; to find the most you can pay for a required margin the price is multiplied by one minus the margin. Whichever mode is used, the result reports the profit, the margin and the markup.
Margin and markup convert by margin = markup ÷ (1 + markup) and markup = margin ÷ (1 − margin), so a 50% markup is a 33.3% margin and a 50% margin needs a 100% markup. A margin of 100% or more is impossible and is rejected; a markup has no ceiling. Selling below cost gives negative figures for both and is reported as such. Prices are before sales tax or VAT.
Worked example
An item bought for $80 and sold for $100 makes $20: a 25% markup on the cost and a 20% margin on the price. To price a $70 item for a 30% margin, divide by 0.7 to get $100; adding 30% instead gives $91, on which the margin is only 23%. To keep a 40% margin on a $100 price, the cost must be no more than $60.
Frequently asked questions
What is the difference between margin and markup?
Both measure the same profit, against different bases. Markup divides the profit by the cost; margin divides it by the selling price. An item bought for $80 and sold for $100 has a $20 profit: a 25% markup (20 ÷ 80) and a 20% margin (20 ÷ 100). Because the price is always the larger figure, the margin is always the smaller percentage. Pricing "at 40%" meaning markup and reporting it as a 40% margin overstates profitability by a third.
How do I price something to make a 30% margin?
Divide the cost by (1 − 0.30). A $70 cost priced for a 30% margin is 70 ÷ 0.7 = $100. Adding 30% to the cost instead gives $91, on which the margin is only 23% — that is a 30% markup. The "price from margin" mode here does the division; the step shows what the mistaken addition would have produced.
How do I convert markup to margin?
Margin = markup ÷ (1 + markup). A 50% markup is 0.5 ÷ 1.5 = 33.3% margin; a 100% markup (doubling the cost) is a 50% margin. Going the other way, markup = margin ÷ (1 − margin), so a 50% margin needs a 100% markup. The conversion table in every result lists the common pairs.
Can a margin be more than 100%?
No. Margin is profit as a share of the price, and profit cannot exceed the price it is part of — a 100% margin would mean the item cost nothing. Markup has no such ceiling: selling a $10 item for $50 is a 400% markup and an 80% margin. If a figure above 100% is described as a margin, it is a markup.
What should I include in the cost?
Everything you spend per unit to sell it, not just what you paid for it: shipping in, packaging, payment processing fees, marketplace commission, and the share of returns. A $50 item bought for $30 with $6 of fees and shipping has a $14 profit and a 28% margin, not the 40% that the purchase price alone suggests. Fixed costs like rent belong in the break-even calculator rather than here.
What is the difference between a profit margin calculator and a markup calculator?
The base. A profit margin calculator divides profit by the selling price; a markup calculator divides the same profit by the cost. An item bought for £80 and sold for £100 has a £20 profit, a 20% margin and a 25% markup. Margin vs markup confusion is the most common pricing error there is, because pricing at a 20% markup when you meant a 20% margin loses money on every sale. A gross margin calculator applies the same margin formula to revenue minus cost of goods across a period; this page shows margin and markup together so the two are never mixed up.
How do I use this as a net profit margin calculator or a selling price calculator?
For net profit margin, enter total revenue as the price and total costs, including overheads, as the cost; the margin shown is then net rather than gross. For the selling price, switch to the target mode: enter the cost and the margin or markup you need, and a selling price calculator gives the price that hits it. A 20% margin on a £80 cost is £100; a 20% markup on the same cost is £96, which is only a 16.7% margin, and the page shows both so the target you set is the one you actually get.