Profit Margin Calculator
PopularCalculate profit margins
Profit Margin Calculator
How to Use the Profit Margin Calculator
1. Select Currency
Choose your preferred currency for accurate calculations and formatting.
2. Enter Values
Fill in any two of the three fields: Cost Price, Selling Price, or Profit Margin percentage.
3. Get Instant Results
The calculator will automatically compute the third value and show all related profit metrics.
4. Download Report
Export detailed profit margin calculations for your business records.
Understanding Profit Margin
What is Profit Margin?
Profit margin is the percentage of revenue that remains after deducting all costs and expenses. It shows how much profit a business makes for every dollar of sales.
- • Gross Margin: Revenue minus cost of goods sold
- • Operating Margin: After operating expenses
- • Net Margin: After all expenses and taxes
- • Markup: Amount added to cost price
Profit Margin Formula
Profit Margin %
= (Profit / Cost Price) × 100
Selling Price
= Cost Price + Profit
Markup %
= (Profit / Cost Price) × 100
Profit Margin Calculation Example
Cost Price: ₹100, Selling Price: ₹125
Profit Amount
₹25
Profit Margin
25%
Markup
25%
Types of Profit Margins
Gross Profit Margin
Measures profitability after accounting for cost of goods sold (COGS).
Gross Margin = (Revenue - COGS) / Revenue × 100
Typical range: 20-70% depending on industry
Operating Profit Margin
Shows profitability after operating expenses but before interest and taxes.
Operating Margin = Operating Income / Revenue × 100
Typical range: 5-25% for most businesses
Net Profit Margin
The most comprehensive margin showing bottom-line profitability after all expenses.
Net Margin = Net Income / Revenue × 100
Typical range: 1-15% depending on industry
Markup vs Margin
Markup is the amount added to cost price, while margin is the percentage of profit.
Markup: (Selling Price - Cost) / Cost × 100
Margin: (Selling Price - Cost) / Selling Price × 100
Multi-Currency Support
Calculate profit margins in different currencies for international business operations.
Frequently Asked Questions
What's the difference between markup and margin?
Markup is calculated on cost price (Profit/Cost × 100), while margin is calculated on selling price (Profit/Selling Price × 100). For example, 25% markup equals about 20% margin.
What is a good profit margin?
Good profit margins vary by industry. Retail businesses typically aim for 20-50% gross margins, while service businesses might target 10-30%. Net profit margins of 5-10% are generally considered healthy.
How do I calculate selling price with desired margin?
To achieve a specific profit margin, use the formula: Selling Price = Cost Price / (1 - Margin%). For example, to get 30% margin on ₹100 cost, selling price = ₹100 / (1 - 0.30) = ₹142.86.
Why do margins vary by industry?
Different industries have different cost structures. High-volume, low-margin businesses (like retail) need high turnover, while low-volume, high-margin businesses (like luxury goods) can operate with lower sales volume.