📊 Profit Margin Calculator
Optimize your pricing strategy. Calculate gross profit, profit margin, and markup instantly.
The amount you paid to acquire the product
The amount you sell the product for
📌 Quick Examples:
📊 Margin vs Markup: What's the Difference?
Many business owners confuse Margin and Markup. While both deal with profit, they calculate it differently relative to cost and revenue.
📈 Profit Margin
Percentage of selling price that is profit.
Formula: (Profit ÷ Selling Price) × 100
Example: ₹50 profit on ₹150 sale = 33.3% margin
🏷️ Markup
Percentage added to cost price.
Formula: (Profit ÷ Cost) × 100
Example: ₹50 profit on ₹100 cost = 50% markup
📋 Margin to Markup Conversion Table
| Margin % | Markup % | Margin % | Markup % |
|---|---|---|---|
| 10% | 11.1% | 35% | 53.8% |
| 15% | 17.6% | 40% | 66.7% |
| 20% | 25.0% | 45% | 81.8% |
| 25% | 33.3% | 50% | 100.0% |
| 30% | 42.9% | 60% | 150.0% |
❓ Frequently Asked Questions
Which is better: Margin or Markup?
Retailers usually focus on Markup to set prices, while investors look at Margin to assess profitability. Both are important for different purposes. Markup helps with pricing strategy, while margin shows true profitability.
What is a good profit margin?
Good profit margins vary by industry. Retail: 2-10%, Restaurants: 3-9%, Software: 20-40%, Consulting: 15-30%. Generally, a net profit margin above 10% is considered healthy, but it depends on your industry.
How do I calculate selling price from cost and margin?
Selling Price = Cost ÷ (1 - Margin%). For example, if cost is ₹100 and you want 25% margin, Selling Price = ₹100 ÷ (1 - 0.25) = ₹133.33.
What's the difference between gross profit and net profit?
Gross profit is revenue minus cost of goods sold (COGS). Net profit is gross profit minus all other expenses (operating costs, taxes, interest, etc.). This calculator shows gross profit margin.
⚠️ Disclaimer: This calculator provides estimates for business pricing decisions. Always consider market conditions, competition, and customer demand when setting final prices.