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Money — Business
Margin Calculator
Enter cost and selling price to get the gross margin, the profit and the equivalent markup.
Gross margin
—
Profit as a share of revenue.
| Profit | — |
|---|---|
| Markup | — |
| Revenue | — |
| Cost | — |
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Enter your figures above to see the step-by-step working.
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How the Margin Calculator Works
Gross margin is your profit expressed as a percentage of revenue — the selling price. Subtract cost from revenue to get profit, then divide by revenue. It tells you how much of every sales dollar you keep, which is why retailers and investors watch it closely.
Margin is easy to confuse with markup, which measures the same profit against cost instead of revenue, so markup is always the larger number. This calculator shows both: enter your cost and selling price to see the margin, the profit and the equivalent markup.
margin = (revenue − cost) ÷ revenue × 100
Frequently Asked Questions
What is the difference between margin and markup?
Both measure profit, but against different bases. Margin divides profit by the selling price (revenue); markup divides the same profit by the cost. Markup is always a larger percentage than margin for the same sale.
What is a good gross margin?
It depends heavily on the industry — groceries run thin single digits while software can exceed 80%. Compare to peers in your own field rather than a universal benchmark.
How do I set a price from a target margin?
Divide your cost by one minus the target margin. For a 60% margin on a $40 cost, price = 40 ÷ 0.4 = $100.
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