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OZO Profit Calculator

Free Profit Margin Calculator

Work out your profit, gross margin and markup from cost and selling price, or find the price that hits a target margin. Free, instant and private: nothing leaves your browser.

  • Free forever
  • No signup
  • Instant results
What do you know?

What the item or service costs you.

Enter your numbers to see the result.

How to calculate profit margin

  1. 1

    Enter your cost

    Type what the product or service costs you, including materials, stock and direct labour.

  2. 2

    Enter the selling price

    Type what the customer pays, before any sales tax.

  3. 3

    Read the margin and markup

    The calculator shows the profit, the gross margin (profit ÷ price) and the markup (profit ÷ cost).

  4. 4

    Or work backwards

    Choose “Target margin” or “Target markup” to find the price you need to charge for the profit you want.

Margin, markup and profit in one place

Profit is what is left from a sale after paying for what you sold: price minus cost. Gross margin expresses that profit as a percentage of the selling price, which makes it easy to compare products and businesses of different sizes. Markup expresses the same profit as a percentage of the cost, which is how many shops set their prices.

The formulas

  • Profit = selling price − cost
  • Margin % = profit ÷ selling price × 100
  • Markup % = profit ÷ cost × 100
  • Price for a target margin = cost ÷ (1 − margin)
  • Price for a target markup = cost × (1 + markup)

Margin vs markup at a glance

MarkupMargin
25%20%
50%33.3%
100%50%
200%66.7%

If you price with a markup but report on margins, convert carefully: a "50% markup" is only a 33% margin. The markup calculator converts between the two.

Know your price? Put it on a professional invoice, free.

Found your margin? The break-even calculator shows how many sales it takes to cover your fixed costs at that price.

Frequently asked questions

How do you calculate profit margin?

Subtract the cost from the selling price to get the profit, then divide the profit by the selling price and multiply by 100. For example, an item that costs 60 and sells for 100 makes 40 profit, a 40% margin.

What is the difference between margin and markup?

Both measure the same profit, against different bases. Margin divides profit by the selling price; markup divides it by the cost. A 40 profit on a 60 cost and 100 price is a 40% margin but a 66.67% markup. Margin can never reach 100%; markup can be any size.

What price gives me a 30% margin?

Divide the cost by 1 minus the margin: price = cost ÷ (1 − 0.30). An item costing 70 needs a price of 100. Use the “Target margin” mode to do this instantly.

What is a good profit margin?

It depends on the industry. Retail and food often run on gross margins of 20–50%, while software and services can exceed 70%. Compare against businesses like yours, and remember gross margin is before overheads such as rent and salaries.

Should I include tax in the price?

No. Use prices excluding VAT or sales tax, because that tax belongs to the government, not to your profit. Our VAT calculator can strip the tax out of a price first.

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