Profit Margin & Markup Calculator
Calculate gross margin and markup from cost and price, or find the price you need for a target margin.
Selling price
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Profit per unit
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Gross margin
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Markup on cost: —
Margin and markup aren't the same number
These two get mixed up constantly, and the gap between them gets bigger as margins grow. Margin is profit divided by selling price — it tells you what share of each sale is profit. Markup is profit divided by cost — it tells you how much you added on top of what something cost you. A $20 item sold for $35 has a $15 profit: that's a 42.9% margin but a 75% markup on cost. Pricing off the wrong one is a common way small businesses end up with thinner profit than they planned.
Using the target-margin mode
If you know your cost and want a specific margin, switch to "cost & target margin" — the calculator works out the price you need to charge using price = cost ÷ (1 − margin), which is the correct formula for hitting a margin target (dividing cost by (1 + markup) is a common mistake that undershoots the actual margin).