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Selling online

Profit Margin Calculator

Calculate profit margin, markup, selling price or cost from any two figures, and see exactly how margin and markup differ when pricing products.

Reviewed by CentExactCalculated in your browser. Shared links include inputs.

Profit per unit

$40.00

$100.00 price − $60.00 cost

Known values
I know
$

What the item costs you to make or buy.

$

  • Profit margin

    40%

    profit ÷ price

  • Markup

    66.67%

    profit ÷ cost

  • Selling price

    $100.00

  • Cost

    $60.00

How the margin and markup differ here

$100.00 price − $60.00 cost = $40.00 profit. Margin measures that profit against the price: $40.00 ÷ $100.00 = 40%. Markup measures the same profit against the cost: $40.00 ÷ $60.00 = 66.67%.

Markup is the larger of the two whenever there is a profit, because cost is the smaller denominator. Margin also has a ceiling markup does not: at 100% the whole price would be profit and the item would have cost nothing.

Which of the two you price with changes what you charge. A 40% margin takes $100.00; adding 40% to the cost as a markup instead would price it at $84.00, leaving a margin of 28.57%.

An estimate, not financial advice, providers may calculate differently.

Where each sale goes
  • Profit$40.0040%
  • Cost$60.0060%

A result link includes the numbers you entered. Share it only with people you want to see them.

How this is calculated

Every sale has three numbers: what the item cost you, what you sold it for, and the profit in between. Profit margin expresses that profit as a share of the price, which is how accounts and most retail targets are stated; markup expresses the same profit as a share of the cost, which is how a supplier or a rule of thumb states it, so markup is always the larger number and the two are never equal for the same sale except at zero profit. The calculator lets you start from any two figures, cost and price, cost and a target margin, cost and a markup, or price and a target margin, and fills in the rest.

ProfitPrice − Cost

MarginProfit ÷ Price

MarkupProfit ÷ Cost

Cost
what the item costs you to make or buy
Price
what you sell it for
Cost and Price are the inputs in 'cost and price' mode; the other three modes rearrange the same lines to solve for the missing figure, and the guide lists them. The $60 item that sells for $100 is worked through there.

What this does not include

  • Overheads such as rent, salaries and marketing unless you put them in the unit cost.
  • VAT or sales tax: enter cost and price on the same tax basis.
  • Discounts and returns: the price is the one you actually receive.
  • Volume effects on unit cost.

Margin and markup explained: pricing from cost, price or a target. Why a 30% markup is a 23% margin, the formulas that convert one to the other, how each calculator mode solves for the missing figure, and what belongs in cost.

CentExactCalculator publisher

CentExact publishes the calculation method, worked examples and available data sources. Automated checks cover reference calculations; they do not certify a result for your circumstances or imply approval by a lender or tax authority.

How we build and test our calculators

This calculator is for general information only and is not financial advice. Results are estimates based on the figures you enter and the stated formula; lenders and providers may round or calculate differently. Check any decision with the institution involved or a qualified adviser.