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Margin Calculator

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Your Results

Selling at $64.00 with a cost of $40.00 leaves a profit of $24.00 on each sale, a gross margin of 37.5% and a markup of 60%. So 37.5% of the price is profit, which is 60% added on top of the cost. For a 40% margin, you'd charge $66.67.

37.5%
Gross Margin
$64.00
Selling Price
$40.00
Cost
$24.00
Profit per Sale
60%
Markup

The selling price at every margin, for a cost of $40.00

  • Selling price
  • Cost
  • Profit
  • Your price
Pricing Table
MarginMarkupSelling PriceProfit
5%5.26%$42.11$42$2.11$2
10%11.11%$44.44$44$4.44$4
15%17.65%$47.06$47$7.06$7
20%25%$50.00$50$10.00$10
25%33.33%$53.33$53$13.33$13
30%42.86%$57.14$57$17.14$17
35%53.85%$61.54$62$21.54$22
37.5%60%$64.00$64$24.00$24
40%66.67%$66.67$67$26.67$27
45%81.82%$72.73$73$32.73$33
50%100%$80.00$80$40.00$40
60%150%$100.00$100$60.00$60
70%233.33%$133.33$133$93.33$93
80%400%$200.00$200$160.00$160
90%900%$400.00$400$360.00$360

Selling price = $40.00 ÷ (1 − margin). Profit = price − cost. Markup = profit ÷ cost. Your margin is highlighted.

Add sales tax to your price of $64.00: Sales Tax Calculator.

What Is Gross Margin?

Gross margin, also called profit margin or gross profit margin, is the share of the selling price you keep after paying for what you sold. If a shirt costs you $40 and sells for $64, you keep $24, which is 37.5% of the price. The cost here is the cost of goods sold: buying or making the item, not rent or wages.

  • Profit: the dollars left from one sale, price minus cost.
  • Margin: that profit as a percent of the selling price.
  • Markup: the same profit as a percent of the cost. It's always bigger than the margin when you make a profit, so mixing them up leads to prices that are too low.
  • Net margin: profit after every expense, including rent, wages and taxes, as a percent of sales. This calculator works out the gross margin.

Margin and markup side by side

The same profit gives a different percent depending on what you divide by:

MarginMarkupPrice for a $100 Cost
10%11.11%$111.11
20%25%$125.00
25%33.33%$133.33
30%42.86%$142.86
40%66.67%$166.67
50%100%$200.00
60%150%$250.00
75%300%$400.00

Which calculator should I use?

  • Margin Calculator: to find your margin, markup and profit, or the price for a target margin.
  • Sales Tax Calculator: to add sales tax to the price you settle on, or take it out of a total.

How to Calculate Gross Margin

Take the cost away from the selling price to get the profit, then divide by the price:

Margin= price−cost price ×100

To set a price that earns a target margin, turn it around:

Price= cost 1−margin
  • Price: what you sell one item for, before sales tax.
  • Cost: what one item costs you to buy or make.
  • Margin: in the second formula, written as a decimal, so 40% is 0.40.
  • Markup: (price − cost) ÷ cost × 100, the profit as a percent of the cost.

Example

An item costs $40.00 and sells for $64.00:

  • Profit: $64.00 − $40.00 = $24.00
  • Margin: $24.00 ÷ $64.00 × 100 = 37.5%
  • Markup: $24.00 ÷ $40.00 × 100 = 60%
  • For a 50% margin instead: $40.00 ÷ (1 − 0.50) = $80.00

How to Use the Margin Calculator

"An item costs me $40.00 and I sell it for $64.00. What's my margin and markup, and what should I charge for a higher margin?" This calculator answers that.

Let's enter the numbers for this example in each box. They are already filled in when the calculator opens, so you can follow along and then change any box to match your own product.

  • What You Know: Choose Cost and price. The two boxes you don't know are greyed out and filled in with the answers. Pick Cost and margin to find the price for a target margin.
  • Gross Margin: Greyed out here, and filled in with 37.5%. When you enter it, it can be from -999.99% to 99.99%. Below 0 means selling under cost.
  • Cost: Enter 40.00, which is what one item costs you. It can be 0 or more, up to $1 billion.
  • Selling Price: Enter 64.00, which is what you charge for one item, before sales tax. It must be more than 0.
  • Profit: Greyed out here, and filled in with $24.00. When you enter it, a negative number is a loss.

Calculate and Reset

Click Calculate to see your results. If a box has a problem, such as a profit bigger than the price, a message pops up under that box instead. With the default numbers you get:

  • Your Results: a short summary in words: $24.00 profit per sale, a 37.5% margin and a 60% markup, and the price for the next margin up.
  • Gross Margin: the headline, 37.5%. The headline is always the first number worked out for you, so with Cost and margin it's the selling price.
  • Selling Price, Cost and Profit per Sale: $64.00, $40.00 and $24.00.
  • Markup: 60%, the profit as a percent of the cost. The other number worked out for you is highlighted.
  • The selling price at every margin: a curve of the price each margin needs, for your cost. The shaded gap above the cost line is the profit, and it widens quickly at high margins. The dot is your price.
  • Pricing Table: the markup, price and profit at common margins from 5% to 90%, with yours highlighted. Download Excel saves it with the formulas, so you can change the cost there.
  • Share Results: a link that opens this calculator with your numbers filled in. Copy it, or share it on Facebook or X.

Click Reset to put every box back to its default and show the default results again. The calculator works on one item before sales tax, discounts and other expenses. This is for information only, not financial advice.