Profit Margin Calculator
See profit, margin and markup in seconds.
Profit margin explained
Profit margin shows how much of a selling price remains as profit after accounting for the relevant cost. A simple gross profit margin calculation is (selling price − cost) ÷ selling price × 100.
Margin and markup are related but different. Margin uses the selling price as the denominator, while markup uses the cost as the denominator. Keeping the two terms separate helps avoid pricing mistakes.
Example
If an item costs ₹600 and sells for ₹900, the profit is ₹300. The profit margin is 33.33%, while the markup on cost is 50%.
Frequently asked questions
Is margin the same as markup? No. They use different reference values.
Can I use this for a business? Yes, as a quick planning calculation. Your accounting records may include additional costs that should be included for a more complete analysis.