HIFreeTools

Free Profit Margin Calculator

Enter your cost and selling price to see the profit, the profit margin, and the markup — the three numbers behind any pricing decision.

Profit
40.00
Profit margin
40.0%
Markup
66.7%

Margin is profit ÷ price; markup is profit ÷ cost. Excludes fees and taxes.

Quick answer

Profit margin is profit as a percentage of the selling price: margin = (price − cost) ÷ price × 100. Markup is profit as a percentage of the cost: markup = (price − cost) ÷ cost × 100. They describe the same profit from two different bases.

Formula & method

profit = price − cost;  margin% = profit ÷ price × 100;  markup% = profit ÷ cost × 100
  • cost — what the item costs you
  • price — what you sell it for

Margin and markup are not the same number: a 50% markup is only a 33.3% margin.

Examples

Example 1: Cost $60, price $100
Input
cost 60, price 100
Result
Profit $40, margin 40%, markup 66.7%
Why
Profit 40; 40 ÷ 100 = 40% margin; 40 ÷ 60 = 66.7% markup.
Example 2: Cost $20, price $30
Input
cost 20, price 30
Result
Profit $10, margin 33.3%, markup 50%
Why
10 ÷ 30 = 33.3% margin; 10 ÷ 20 = 50% markup.
Example 3: Cost $8, price $8
Input
cost 8, price 8
Result
Profit $0, margin 0%
Why
Selling at cost means no profit.

When to use this tool

  • Setting a selling price for a product.
  • Checking the margin on an ecommerce or resale item.
  • Comparing markup and margin when negotiating.

Common mistakes

  • Confusing margin and markup. A 50% markup equals a 33.3% margin, not 50%.
  • Pricing to a target margin using the markup formula by mistake — it undershoots.
  • Forgetting fees, shipping, and taxes, which eat into real profit.

Frequently asked questions

＋ What is profit margin?

Profit margin is your profit expressed as a percentage of the selling price: (price − cost) ÷ price × 100.

＋ What's the difference between margin and markup?

Margin is profit over the selling price; markup is profit over the cost. The same $40 profit on a $100 sale is a 40% margin but a 66.7% markup.

＋ How do I price for a target margin?

Divide your cost by (1 − target margin). For a 40% margin on a $60 cost: 60 ÷ 0.60 = $100.

＋ Does this include fees and shipping?

No. Enter your true landed cost to include them, or treat the result as gross margin before selling fees.

＋ Is this financial advice?

No. It's a pricing calculator for estimates, not financial advice.

  • ✓ Free to use
  • ✓ No sign-up required
  • ✓ Runs entirely in your browser — nothing is uploaded.
  • ✓ Formula and method shown above
Last updated: How we calculateReport a correctionDisclaimer

Provided “as is” for general information only — results may be inaccurate, so verify before you rely on them. No warranty; use at your own risk.

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