getassistanceProfit Margin Calculator
Enter your cost and selling price to see your profit, margin and markup. Free to use, with no signup.
Your results
Enter both amounts and choose Calculate.
- Cost Price
- Selling Price
- Profit Margin
- Profit ÷ selling price
- Markup
- Profit ÷ cost price
This result reflects the costs you enter. Include relevant costs to understand what remains after expenses.
What is Profit Margin?
Profit margin tells you how much of your selling price remains after subtracting your cost. If you sell something for Rs. 100 and it costs Rs. 80, Rs. 20 remains: a 20% margin.
For a product, cost might include the purchase price, packaging and delivery that you pay for. For a service, it might include materials, paid help and the cost of your time. If you enter only direct costs, the result is gross profit on that transaction. It does not automatically include rent, taxes or other overheads.
How to Calculate Profit Margin
Profit = Selling Price − Cost Price
Subtract your cost from the selling price to find the amount you earn, or lose, on the sale.
Profit Margin (%) = (Profit ÷ Selling Price) × 100
Divide that profit by the selling price, then multiply by 100. The result is the percentage of the sale you keep after the entered cost. A zero selling price has no defined margin because division by zero is not possible.
Profit Margin Example
A small supplier buys a product for Rs. 8,000 and sells it for Rs. 10,000.
| Figure | Calculation or amount |
|---|---|
| Cost Price | Rs. 8,000 |
| Selling Price | Rs. 10,000 |
| Profit | Rs. 10,000 − Rs. 8,000 = Rs. 2,000 |
| Profit Margin | (Rs. 2,000 ÷ Rs. 10,000) × 100 = 20% |
| Markup | (Rs. 2,000 ÷ Rs. 8,000) × 100 = 25% |
The business earns Rs. 2,000 gross profit on this transaction, representing a 20% margin on the selling price.
Profit Margin vs Markup
Margin compares profit with selling price. Markup compares profit with cost price. They use different starting amounts, so they are not the same percentage.
In the example above, the same Rs. 2,000 profit is 20% of the Rs. 10,000 selling price, but 25% of the Rs. 8,000 cost. Adding a 20% markup to Rs. 8,000 produces a Rs. 9,600 selling price and a margin of about 16.67%, not 20%.
Markup (%) = (Profit ÷ Cost Price) × 100
Frequently Asked Questions
What is a profit margin?
It is the percentage of your selling price left after subtracting the cost you include. A Rs. 20 profit on a Rs. 100 sale is a 20% margin.
How do I calculate profit margin?
Subtract cost price from selling price. Divide the result by selling price and multiply by 100. Use the same currency and quantity for both prices.
What is the difference between margin and markup?
Margin divides profit by selling price; markup divides profit by cost. A Rs. 2,000 profit on an Rs. 8,000 cost and Rs. 10,000 selling price is a 20% margin and a 25% markup.
Can profit margin be negative?
Yes. If cost is Rs. 10,000 and selling price is Rs. 8,000, the loss is Rs. 2,000. The margin is −25% and the markup is −20%. The calculator labels this as a loss.
Is a 20% margin the same as a 20% markup?
No. A 20% markup on an Rs. 8,000 cost gives a selling price of Rs. 9,600. To achieve a 20% margin on that cost, the selling price must be Rs. 10,000.
Does this calculator work for services?
Yes. Enter the relevant service cost and the price charged to your customer. Decide which costs to include, such as materials, paid help and your time, before comparing results.
What happens if cost or selling price is zero?
Zero is allowed. A zero cost makes markup undefined; a zero selling price makes margin undefined. The calculator shows “Not defined” for that percentage and still calculates the profit or loss.
Useful GetAssistance Tools
Related Calculators
Markup Calculator
Calculate selling price, markup amount, profit and profit margin from your cost price.
Open calculator ↗Sales Tax / GST Calculator
Calculate Sales Tax or GST, add tax to a price or extract tax from a tax-inclusive amount.
Open calculator ↗Discount Calculator
Calculate sale prices, discount amounts, total savings, multiple discounts and original prices.
Open calculator ↗Profit & Loss Calculator
Calculate profit or loss, profit/loss percentage and profit margin from cost and selling price.
Open calculator ↗Percentage Increase / Decrease Calculator
Calculate percentage increases, decreases and changes between values, or reverse a percentage change.
Open calculator ↗Commission Calculator
Calculate commission, commission percentage, original sales amount and base salary plus commission earnings.
Open calculator ↗Freelance Hourly Rate Calculator
Estimate a sustainable freelance hourly rate based on your income goal, expenses, working time and billable hours.
Open calculator ↗