Free tool
Profit margin and markup calculator
Overview
Enter what an item costs you and what you sell it for. See your profit, your margin and your markup, or work backward from the margin you want.
Keeping your own books? Tallyfinch does invoices, bank import and reports on your computer. See Tallyfinch
Your numbers
Work backward (optional)
Excel workbook · $24
Break-Even and Pricing Workbook
Enter your fixed costs and what each product or service costs and sells for, then see the sales you need and the price that reaches your target margin.
See what is inside ($24)How it works
How it works
Profit is price minus cost. Margin divides that profit by the price, and markup divides it by the cost. To work backward, a target margin gives price = cost divided by (1 minus margin), and a target markup gives price = cost times (1 plus markup).
FAQ
About this calculator
What is the difference between margin and markup?
Margin is profit divided by the selling price. Markup is profit divided by what the item cost you. An item that costs $60 and sells for $100 has a 40% margin and a 66.7% markup.
How do I price for a target margin?
Divide your cost by one minus the margin. For a 40% margin on a $60 cost, $60 divided by 0.60 is $100. The calculator does this for you.
Is gross margin the same as net profit?
No. Gross margin only subtracts what the item cost. Rent, wages, software, fees and taxes come out after that, so your net profit is lower.
What is a good margin?
It depends on the business. Restaurants, retail, services and software all run very different margins. Compare to businesses like yours, and make sure your margin covers your other costs.
Is anything saved?
No. The math runs in your browser and nothing you enter is sent to us.
Selling at markets or online? The Sales-Channel Profit Tracker shows which channel makes money. Try the craft fair profit calculator too. Read gross margin vs markup for the difference. More free tools: Cap rate calculator, Cash-on-cash return calculator, Debt payoff calculator, or see all free tools.
Free
Month-End Close Checklist (PDF)
The five-day close, one page to print. Enter your email and we send a link to confirm it is yours, then the download. We may email you about new toolkits, and every email has an unsubscribe link.
General information, not tax or legal advice. How we write and check our tools.
Excel workbook
Break-Even and Pricing Workbook
Enter your fixed costs and what each product or service costs and sells for, then see the sales you need and the price that reaches your target margin.
See what is inside ($24) Try the free starter
Also in the Business Planning Bundle: 4 products for $79 instead of $106 separately.
Tallyfinch
Books you keep on your own computer
Tallyfinch does invoices, bills, bank import, reconciliation and the main reports, in a file you own. $99 once, then $5 a month for updates; the app keeps working if you stop the plan. It does not do payroll or sales tax filing. The free download records up to 60 entries.
See Tallyfinch Download it free Compare the three apps