Calculate gross profit margin, markup percentage, and net profit — with margin/markup conversion.
| Margin | Equivalent Markup |
|---|---|
| 10% | 11.1% |
| 20% | 25.0% |
| 30% | 42.9% |
| 40% | 66.7% |
| 50% | 100.0% |
Choose whether to calculate from a known cost and selling price, or from a known cost and a target profit margin you want to hit. Enter your values and the calculator instantly shows your profit margin, markup percentage, profit per unit, and the recommended selling price.
Profit margin is profit as a percentage of the selling price (revenue), while markup is profit as a percentage of the cost. These are frequently confused, and the difference becomes large at higher percentages. A 50% markup on a $40 cost item gives a $60 selling price, which is only a 33% margin, not 50%. Always check which one you're being quoted before pricing decisions.
If you know your desired profit margin and your cost, use "Cost & Target Margin" mode. The calculator works backward from the formula Selling Price = Cost / (1 − Margin) to tell you exactly what price to charge to hit that margin.
Profit Margin (%) = (Selling Price − Cost) / Selling Price × 100. This expresses profit as a percentage of what the customer pays, which is the standard way margin is reported in financial statements and most business contexts.
Markup (%) = (Selling Price − Cost) / Cost × 100. This expresses profit as a percentage of what the item cost you, which is common in retail and wholesale pricing discussions. Markup will always be a larger number than margin for the same transaction (except at 0%).
It varies enormously by industry. Grocery and retail businesses often operate on thin margins of 2–5%, while software and services businesses can see margins above 70–80% due to low marginal cost. Restaurants typically target 10–15%. There's no universal benchmark — compare against your specific industry rather than a general rule of thumb.