Free Profit Margin Calculator
Calculate profit margin and markup percentage quickly. Perfect for pricing products, setting profit goals, and understanding your business profitability.
Disclaimer: This profit margin calculator is provided for general informational purposes only and does not constitute financial, tax, or legal advice. We make no guarantees regarding the completeness or reliability of the results. Please consult a registered professional.
About Profit Margin Calculator
Our free profit margin calculator helps small businesses calculate profit margins, markup percentages, and optimal selling prices. Whether you're pricing products, setting profit goals, or analyzing your business profitability, this tool makes it easy.
How to Use the Profit Margin Calculator
- Select your calculation method: Selling Price, Profit Margin, or Markup Percentage (%)
- Enter your cost price (the amount you pay for the product/service)
- Enter the additional information based on your selected method
- View the calculated results showing profit, profit margin, and markup percentage
What is Profit Margin?
Profit Margin is the percentage of revenue that remains as profit after deducting costs. It shows how much of each dollar in sales is actual profit.
Markup Percentage is the percentage increase from cost price to selling price. It shows how much you add to your cost to determine the selling price.
Example: If a product costs $50 and you sell it for $75, your profit is $25. The profit margin is 33.33% ($25 / $75), and the markup is 50% ($25 / $50).
Frequently Asked Questions
What's the difference between profit margin and markup?
Profit Margin: Calculated as (Profit / Selling Price) × 100. It shows what percentage of your selling price is profit.
Markup: Calculated as (Profit / Cost Price) × 100. It shows what percentage you add to your cost to get the selling price.
For example, if you buy a product for $50 and sell it for $75, the markup is 50% but the profit margin is 33.33%.
What is a good profit margin for small businesses?
Profit margins vary by industry, but generally:
• Retail businesses: 5-10%
• Service businesses: 10-20%
• Technology businesses: 15-25%
• Restaurants: 3-7%
However, the ideal margin depends on your specific business model, overhead costs, and market conditions.
How do I calculate selling price from cost and target margin?
Use the "Cost & Margin" calculation mode. Enter your cost price and target profit margin percentage. The calculator will automatically determine the selling price needed to achieve that margin.
Is this calculator free to use?
Yes! Our profit margin calculator is completely free to use. No registration required, no hidden fees. Just enter your values and calculate profit margins instantly.
Can I use this for pricing my products?
Absolutely! This calculator is perfect for determining selling prices based on your costs and desired profit margins. It helps you set prices that ensure profitability while remaining competitive in your market.
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