Profit Margin Calculator

Calculate profit margins, convert between markup and margin, and analyse your business profitability.

Calculate Profit Margin
£
The price you pay for the product/service
£
The price you sell to customers
£
Shipping, packaging, allocated fixed costs
Calculate totals for multiple units
Markup vs Margin Converter
Markup is the percentage added to cost price. Margin is the percentage of selling price that is profit.
Markup to Margin
%
Profit Margin: 33.33%
Margin to Markup
%
Markup: 50.00%
Common Conversions
Markup Margin Example (£100 cost)
25%20%Sell at £125, profit £25
50%33.33%Sell at £150, profit £50
100%50%Sell at £200, profit £100
150%60%Sell at £250, profit £150
200%66.67%Sell at £300, profit £200
Break-Even Price Calculator
£
£
%
Leave blank to use margin instead
Understanding Profit Margins
Gross Profit Margin

Gross profit margin measures the percentage of revenue that exceeds the cost of goods sold (COGS). It's calculated as:

Gross Margin = ((Selling Price - Cost Price) / Selling Price) × 100
Net Profit Margin

Net profit margin accounts for all costs including overheads, operating expenses, taxes, and interest. For this calculator:

Net Margin = ((Selling Price - Cost Price - Overheads) / Selling Price) × 100
Markup vs Margin - Key Differences
Markup
  • Based on cost price
  • How much you add to cost
  • Can exceed 100%
  • Formula: (Profit / Cost) × 100
Margin
  • Based on selling price
  • Percentage of sale that's profit
  • Always less than 100%
  • Formula: (Profit / Selling Price) × 100
Quick Formulas
Profit Margin

(Selling - Cost) / Selling × 100

Markup

(Selling - Cost) / Cost × 100

Markup to Margin

Markup / (100 + Markup) × 100

Margin to Markup

Margin / (100 - Margin) × 100

Selling Price (from margin)

Cost / (1 - Margin%)

Industry Benchmarks

Typical gross profit margins by industry:

  • Retail: 25-50%
  • Restaurants: 60-70%
  • Software/SaaS: 70-90%
  • Manufacturing: 25-35%
  • Consulting: 50-70%
  • Construction: 10-20%
Related Tools