Case 1
- Cost
- 60
- Selling price
- 100
40.00%
Open with these valuesProfit Margin Calculator
40.00%
Result: 40.00 %Margin is profit as a share of the selling price: (price − cost) ÷ price × 100. Cost 60 sold at 100 is a 40 % margin. The same 40 of profit measured against the cost of 60 is a 66.7 % markup — same money, different base, and margin is always the smaller of the two.
Worked examples
Case 2
- Cost
- 75
- Selling price
- 100
25.00%
Open with these valuesCase 3
- Cost
- 2.5
- Selling price
- 4
37.50%
Open with these valuesHow it's calculated
Margin = (price − cost) ÷ price × 100
- StepEnter what the item costs you.
- StepEnter the price you sell it for.
- ResultRead the margin; a negative value means selling below cost.
Reference table
| Cost, price | Markup (%) | Margin (%) |
|---|---|---|
| 100, 80 | -20 | -25 |
| 75, 100 | 33.33 | 25 |
| 2.50, 4.00 | 60 | 37.50 |
| 60, 100 | 66.67 | 40 |
| 50, 200 | 300 | 75 |
Questions
How do I calculate profit margin?
Subtract the cost from the selling price, divide by the selling price, and multiply by 100. For a cost of 60 and a price of 100 that is (100 − 60) ÷ 100 × 100 = 40 %.
What is the difference between margin and markup?
They describe the same profit from different bases. Margin divides the profit by the selling price, markup divides it by the cost. Cost 60 at a price of 100 is a 40 % margin but a 66.7 % markup, because the cost is the smaller base.
How do I convert a margin into a markup?
Use markup = margin ÷ (100 − margin) × 100, so a 40 % margin is 40 ÷ 60 × 100, about 66.7 %. The other direction is margin = markup ÷ (100 + markup) × 100.
Can a profit margin be more than 100 %?
No. Margin is the share of the selling price you keep, and you cannot keep more than the whole price. Markup has no such ceiling: a cost of 50 sold for 200 is a 75 % margin but a 300 % markup.
Is this gross margin or net margin?
Gross margin — it counts only the direct cost of the item against its price. Overheads, shipping, payment fees, taxes and returns are not subtracted, so your net margin per sale is lower.
Sources and last check
Information, not professional advice.