Profit Margin Calculator
Enter cost and selling price. Get profit margin, markup percentage, and gross profit — all at once.
Margin Formula
Margin is always expressed as a fraction of the selling price. That's what distinguishes it from markup.
Markup Formula
Markup uses cost as the reference. It answers: "how much did I add on top of what I paid?"
Example
You buy an item for £60 and sell it for £100:
- Profit = £100 − £60 = £40
- Margin = £40 ÷ £100 × 100 = 40%
- Markup = £40 ÷ £60 × 100 = 66.67%
Both are 100% correct — they just measure different things. See Markup vs Margin for a full comparison.
What is a Good Profit Margin?
It depends entirely on your industry. Grocery margins are 1–3%. Software margins can exceed 80%. What matters is whether your margin covers all your costs (not just the direct cost used here) and leaves acceptable profit.
Common Questions
Is a 40% margin the same as a 40% markup?
No. A 40% margin on a £100 sale means £40 profit on a £60 cost — which is a 66.7% markup. They always produce different percentages on the same numbers.
What markup gives me a 50% margin?
A 100% markup. If you double the cost (markup = 100%), the profit equals the cost, which is 50% of the selling price (margin = 50%).
Can margin exceed 100%?
No. Margin can never exceed 100% because profit can never exceed the selling price. Markup, however, has no upper limit.