Formulas
- Profit = price − cost
- Gross margin = profit ÷ price × 100
- Markup = profit ÷ cost × 100
- Price for a target margin = cost ÷ (1 − margin ÷ 100)
Margin vs markup table
| Markup | Margin |
|---|---|
| 25 % | 20 % |
| 50 % | 33.3 % |
| 100 % | 50 % |
| 200 % | 66.7 % |
Leave the price empty and enter a target margin to get the price you need to charge.
Frequently asked questions
What is a good profit margin?
It depends on the industry: retail is often 20–50 % gross margin, software and services much higher.
Can a margin be over 100%?
No — margin is a share of the price. Markup can be over 100 %.
Does this include overheads?
It calculates gross margin from the cost you enter; include overheads in the cost for net margin.