Find your profit margin and markup from what an item costs and what you sell it for, work out the selling price for a target margin, or see the most you can pay. Works in any currency, with GST, VAT or sales tax taken out of the price.
$
What you pay to buy or make it
$
What the customer pays you
Quantity and sales tax (GST, VAT)
For totals; empty for one item
%
GST, VAT or sales tax on the selling price
Profit margin
40%
Markup
66.67%
Profit per item
$40.00
A price of $100.00 minus a cost of $60.00 leaves a profit of $40.00. Margin = profit ÷ price = 40%; markup = profit ÷ cost = 66.67%.
What the customer pays: $100.00
Cost: $60.00 (60%)
Profit: $40.00 (40%)
Enter costs without any tax you can claim back. This is the margin on one item (gross margin); rent, wages and other running costs come out of it before your net profit.
How to use the profit margin calculator
Choose your currency and what to work out: the margin and markup, a selling price, or the most you can pay.
Enter the cost per item and the selling price, or a target margin or markup.
If your price includes GST, VAT or sales tax, open "Quantity and sales tax", enter the rate and tick the box. Add the units sold for totals.
Read the margin, markup and profit, and the split of what the customer pays into cost, profit and tax.
Formulas
Profit = selling price − cost
Margin = profit ÷ selling price × 100
Markup = profit ÷ cost × 100
Price for a target margin = cost ÷ (1 − margin) and price for a markup = cost × (1 + markup)
You buy a product for 60 and sell it for 100. The profit is 40.00, the margin 40% and the markup 66.67%. To earn a 30% margin on the same product you'd price it at 85.71.
Markup and margin table
The margin you get from each markup on cost.
Markup
Margin
Price of a 100 item
10%
9.09%
110.00
20%
16.67%
120.00
25%
20%
125.00
30%
23.08%
130.00
50%
33.33%
150.00
75%
42.86%
175.00
100%
50%
200.00
150%
60%
250.00
200%
66.67%
300.00
Selling at a discount? The discount calculator shows the sale price, and the GST calculator adds or removes GST or VAT from a price.
A calculator for pricing decisions, not financial or tax advice. Check the tax rate that applies to your goods.
Frequently asked questions
How do you calculate profit margin?
Subtract the cost from the selling price to get the profit, divide the profit by the selling price and multiply by 100. An item that costs 60 and sells for 100 makes a profit of 40, so the margin is 40 ÷ 100 = 40%.
What is the difference between margin and markup?
Both use the same profit. Margin divides it by the selling price; markup divides it by the cost. The item that costs 60 and sells for 100 has a 40% margin but a 66.67% markup. A markup is always bigger than the margin on the same sale, so don't mix them up when you set prices.
How do I price a product for a 30% margin?
Divide the cost by (1 − 0.30). A product that costs 60 needs a price of 60 ÷ 0.7 = 85.71 for a 30% margin. Adding 30% to the cost (60 × 1.3 = 78.00) is a 30% markup, which is only a 23.08% margin.
Should GST or VAT be included in the selling price?
Not when you work out the margin: the tax you collect goes to the government, so it isn't revenue. Enter the price before tax, or tick "My selling price includes this tax". For example 118 including 18% GST is 100.00 plus 18.00 tax; with a cost of 70 the margin is 30%, not the 40.68% you'd get by using 118.
Is this gross or net profit margin?
It's the gross margin on what you sell: price minus the cost of the goods. Net profit margin also takes off running costs such as rent, wages, marketing, interest and tax, then divides by total revenue, so it's always lower. Use the gross margin to price items and the net margin to judge the whole business.
What's the most I can pay for stock to keep my margin?
Choose "Most I can pay", enter the selling price and your target margin. To sell at £24 including 20% VAT (£20 before VAT) with a 25% margin, you can pay up to £15.00 for the item.
