Margin Calculator
Enter your revenue (selling price) and cost to calculate profit margin. This calculator shows your profit amount and margin percentage — essential for pricing decisions and financial analysis.
Formula
Profit = Revenue − Cost Margin % = (Profit ÷ Revenue) × 100
Profit margin is the percentage of revenue that remains as profit after costs. It is calculated by dividing profit by revenue, not by cost. This is the key difference between margin and markup.
Worked Examples
Frequently Asked Questions
What is the difference between margin and markup?▾
Margin is profit as a percentage of revenue (selling price). Markup is profit as a percentage of cost. A 50% markup on a $100 cost gives a $150 selling price, but the margin is only 33.3%.
What is a good profit margin?▾
This varies widely by industry. Retail margins are often 3–10%, while software companies may have 60–90% margins. Compare against your industry benchmarks for context.
Can margin be negative?▾
Yes. A negative margin means you are selling below cost — your revenue does not cover your costs. This indicates a loss on each sale.
How do I convert margin to markup (and vice versa)?▾
Margin to markup: Markup = Margin ÷ (1 − Margin). For example, a 25% margin equals a 33.3% markup. Markup to margin: Margin = Markup ÷ (1 + Markup). A 50% markup equals a 33.3% margin. They are always different numbers for the same transaction.
What margin do I need to cover a discount?▾
Your maximum safe discount roughly equals your margin percentage. With a 30% margin you can discount up to 30% and still cover costs. But to maintain the same total profit, you need a disproportionate volume increase — a 20% discount on a 40% margin product requires 100% more sales to break even.
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All calculations are for informational purposes only. They should not replace professional financial, tax, or legal advice. Always consult a qualified professional for decisions affecting your finances or business.