Margin Calculator
Enter cost and selling price to get your gross margin %, profit per unit, and the equivalent markup. Price with confidence.
Gross margin
40.0%
Profit per unit
$40.00
Equivalent markup
66.7%
Margin is profit as a % of price; markup is profit as a % of cost. A 40.0% margin equals a 66.7% markup.
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How to Use This Calculator
Enter the cost of the item.
Enter the selling price.
We calculate gross margin, profit, and equivalent markup.
Adjust either value to hit a target margin.
Frequently Asked Questions
How do you calculate gross margin?
Gross margin = (price − cost) ÷ price × 100. If a $100 item costs $60, the margin is ($40 ÷ $100) = 40%.
What’s the difference between margin and markup?
Margin is profit as a % of the selling price; markup is profit as a % of cost. A 40% margin equals a 66.7% markup — they’re never the same number.
What is a good profit margin?
It varies by industry — software margins can exceed 80%, retail often runs 20–50%, groceries far less. Compare to peers in your sector rather than a universal target.
How do I price to hit a target margin?
Price = cost ÷ (1 − target margin). To get a 40% margin on a $60 item: $60 ÷ 0.6 = $100. This calculator shows the resulting margin as you adjust price.
Why does margin matter more than markup for pricing?
Margin tells you what share of each sale you keep after cost — it maps directly to profitability. Markup can look high while the real margin is modest.
Why Use This Calculator
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Get gross margin % from cost and price
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See profit per unit
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See the equivalent markup %
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Understand margin vs markup at a glance
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