Margin Calculator

Enter what you sell something for and what it costs you. The calculator returns:

• Profit margin: (price − cost) ÷ price × 100
• Profit: price − cost
• Markup: (price − cost) ÷ cost × 100

With the defaults, a $100 price and a $70 cost give a 30.00% margin, $30 profit and a 42.86% markup. Read the margin as cents per dollar of sales: of every $1 a customer pays, 30 cents is left after covering the cost.

The calculator has no idea what your cost includes. Enter only what you paid for the product and you get a gross margin per unit. Add shipping you absorb, payment and platform fees, packaging and a share of overheads, and the figure moves toward a net margin.

Say an item sells for $48. With a $31.20 total cost per unit, the calculator shows a 35.00% margin, $16.8 profit (that is, $16.80) and a 53.85% markup. Whichever version you use, keep it the same from month to month, or the margins won't be comparable.

Suppose product A sells for $100 and costs $70 (a 30% margin), and product B sells for $20 and costs $10 (a 50% margin). Averaging the two percentages gives 40%, but that's not your margin on the pair.

Add the revenue and the costs first: $120 of sales and $80 of cost. Enter those and the calculator shows 33.33%. The big, low-margin product weighs more because more of your revenue comes from it. Always compute a store-wide or monthly margin from totals.

A $200 item at a 20% margin earns $40 per sale. A $50 item at a 50% margin earns $25. The percentage tells you how efficiently each sale turns into profit; the dollar figure tells you what each sale contributes. Use margin to compare pricing and dollars to plan whether sales will cover your fixed costs.

Margin also tells you how much room you have when costs rise. The highest cost you can absorb at a minimum margin is price × (1 − minimum margin). At a $100 price with a 25% floor, costs can rise to $75 before you need to reprice.

• Cost above price: a $100 price with a $120 cost shows a −20.00% margin, a −16.67% markup and profit as $-20, meaning a $20 loss.
• Zero cost: the margin is 100.00%, and markup shows a dash because nothing can be divided by a zero cost.
• Zero price: the margin shows a dash for the same reason.