Financial Tools
Profit Margin Calculator
Margin is profit over revenue, markup is profit over cost, and mixing them up is the most common pricing mistake in a small business. This gives both, plus the price that hits a margin you name.
Revenue (what the customer pays)
Cost (cost of goods, direct cost of delivering it)
Target Margin (percent, to solve for the price)
Units Sold (optional, for the per unit figures)
Values shown are examples. Use one period, one product line or one job, whichever question you are answering.
Margin and Markup
| Gross Profit | $0 |
| Profit Margin | n/a |
| Markup | n/a |
| Price for Your Target Margin | $0 |
| Highest Cost That Still Hits It | $0 |
| Revenue per Unit | $0 |
| Cost per Unit | $0 |
| Profit per Unit | $0 |
For illustration only, not financial advice. Results are estimates based on the numbers you enter and do not constitute an offer, rate quote or approval.
Questions people ask
What is the difference between margin and markup?
Both start from gross profit, which is revenue minus cost. Margin divides that profit by revenue; markup divides it by cost. On a profitable sale, markup is always the larger percentage.
How does the page find the price for my target margin?
It divides your cost by one minus the target margin. Highest Cost That Still Hits It works the other way: your revenue times one minus the target margin.
What should I enter as cost?
Cost of goods and the direct cost of delivering what you sell, for one period, one product line or one job. Overheads such as rent are not part of this figure unless you choose to add them.
What are the per unit figures?
If you enter units sold, the page divides revenue, cost and profit by that number. Leave it blank and those lines stay at zero.
