Profit Margin Calculator
Work out your sale price, margin, markup, or cost in seconds. Pick what you want to find, enter your numbers, and read the result instantly.
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Margin
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Markup
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What is profit margin?
Profit margin is how much of every dollar you take in that you actually keep. Take your sale price, subtract what the item cost you, and express the remainder as a percentage of that sale price. An item that costs $10 and sells for $15 leaves $5 of profit, and $5 out of $15 is a 33.3% margin.
The word “margin” on its own usually means gross margin— sale price minus the direct cost of the goods. Once you also subtract overheads like rent, software, advertising and tax, you get net margin, which is always smaller and is the number that tells you whether the business as a whole is working.
Margin matters more than raw profit because it scales. A $5 profit tells you nothing on its own; a 33% margin tells you that a third of everything you sell is yours to keep, which is what lets you compare a $15 candle against a $400 chair and know which one is really pulling its weight. It is also the fastest way to spot a product that is quietly losing money once fees and postage land.
For a fuller walkthrough with more worked examples, see our guide on how to calculate profit margin.
Margin vs markup: the difference that costs sellers money
Margin and markup describe the same profit measured against different things. Margin divides profit by the sale price. Markup divides the same profit by the cost. Because the sale price is the bigger number, margin always comes out lower than markup for the same sale.
Buy for $10, sell for $15, and you have made $5 either way. As a markup that is $5 ÷ $10 = 50%. As a margin it is $5 ÷ $15 = 33.3%. Same sale, two very different-looking numbers.
This is where real money goes missing. A seller who wants a 30% margin and adds 30% to their cost ends up with a 23% margin instead — a shortfall that quietly compounds across every unit sold. Suppliers and wholesalers usually quote in markup, accountants and marketplaces almost always report in margin, so the two get mixed up constantly.
| If you want this margin | Apply this markup | $10 item sells for |
|---|---|---|
| 20% | 25% | $12.50 |
| 25% | 33.3% | $13.33 |
| 33.3% | 50% | $15.00 |
| 40% | 66.7% | $16.67 |
| 50% | 100% | $20.00 |
| 60% | 150% | $25.00 |
To convert between them: margin = markup ÷ (1 + markup), and markup = margin ÷ (1 − margin), using decimals. The bottom row is keystone pricing — doubling your cost, a 100% markup that yields a 50% margin. Our margin vs markup guide goes deeper on when each one is the right lens.
How to use this profit margin calculator
Start by choosing what you are trying to work out. The calculator has four modes because pricing questions come in four shapes, and each one asks for only the two numbers it actually needs.
- Find my sale price — you know your cost and the markup you want to apply. Enter both and get the price to charge.
- Find my margin — you already have a cost and a selling price, and want to know what you are really keeping.
- Price for target margin — you know the margin you need to hit. This does the division properly rather than just adding a percentage to cost.
- Find my cost — you know what the market will pay and the margin you need, so you can work backwards to the most you can afford to pay a supplier.
Results update as you type, and every mode shows the full picture underneath — sale price, cost, profit, margin and markup together — so you can sanity-check a number against the one your supplier or marketplace quoted. Decimals are fine, and Reset clears everything at once.
One thing to watch: whatever you enter as cost is what the maths treats as your total cost. Include packaging, postage and platform fees if you want a figure you can trust. If you sell on a marketplace, the Etsy, Amazon FBA, eBay and Shopify calculators build those fees in for you.
More free calculators
Etsy Profit Calculator
Net profit after Etsy listing, transaction, payment, and Offsite Ads fees.
Amazon FBA Profit Calculator
Net profit, margin and ROI after Amazon referral, fulfillment and storage fees.
eBay Profit Calculator
Net payout after eBay's final value fee, per-order charge and international fees.
Shopify Profit Calculator
Real profit per sale after Shopify payment processing, surcharges and plan share.
Profit margin: frequently asked questions
How do I calculate profit margin?
Subtract your cost from your sale price to get your profit, divide that profit by the sale price, then multiply by 100. So an item that costs $10 and sells for $15 makes $5 profit, and $5 ÷ $15 × 100 = 33.3% margin. The key detail is that you divide by the sale price, not the cost — dividing by cost gives you markup instead.
What is the difference between margin and markup?
Both measure the same profit, but against different bases. Margin is profit as a percentage of the sale price; markup is profit as a percentage of the cost. An item bought for $10 and sold for $15 has a 50% markup but only a 33.3% margin. Markup is always the larger number, and the gap widens as prices rise.
What is a good profit margin?
It depends heavily on your industry. Grocery and supermarket retail runs on 1%–3% net margins, general retail and e-commerce typically land between 5% and 15%, and software or digital products can exceed 70%. For handmade and marketplace sellers, aim for at least 30%–40% gross margin before platform fees, because fees and returns will eat a meaningful slice of it.
Can profit margin be more than 100%?
No. Profit margin is your profit as a share of the sale price, and your profit can never be larger than the price you sold at. A margin approaching 100% means your cost is approaching zero. Markup has no such ceiling — a $2 item sold for $20 is a 900% markup but a 90% margin.
Is this gross margin or net margin?
It is whichever you feed it. If you enter only the cost of the product itself, you get gross margin. If you fold in every per-unit cost — materials, packaging, postage, platform fees, payment processing — the result is much closer to a true net margin. For marketplace sellers, our Etsy, Amazon FBA, eBay and Shopify calculators handle those fees for you.
How do I set a price to hit a target margin?
Divide your cost by one minus your target margin as a decimal. To hit 40% margin on a $10 item: $10 ÷ (1 − 0.40) = $16.67. Do not simply add 40% to your cost — that gives $14.00, which is only a 28.6% margin. The 'Price for target margin' mode does this for you.
Does this calculator store the numbers I enter?
No. Every calculation runs in your browser, and nothing you type is sent to a server or saved anywhere. Closing the tab discards it all.
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