FinanceBilldesk

Profit Margin & Markup Calculator

Enter what an item costs you and what you sell it for to see your margin, your markup and the profit on each unit.

Last updated: October 2026

How it works

Margin vs markup

Margin is profit as a percentage of the selling price. Markup is profit as a percentage of cost. Margin = (price − cost) ÷ price × 100. Markup = (price − cost) ÷ cost × 100.

Worked example

An item costs $40 and sells for $65. Profit is $25. Margin is 25 ÷ 65 = 38.5% and markup is 25 ÷ 40 = 62.5%. Same sale, two different percentages.

Frequently asked questions

What is the difference between margin and markup?

Margin is measured against the selling price and markup against the cost, so markup is always the larger number when you make a profit.

How do I calculate profit margin?

Subtract cost from the selling price, divide by the selling price and multiply by 100.

What is a good profit margin?

It depends on the industry. Retail margins are often thin, while software and services can be much higher. Compare with similar businesses.

Does this include overhead and taxes?

No. It shows the margin on a single item before rent, wages, taxes and other costs.

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