What is the Profit Margin Calculator?
Shopkeepers, online sellers and wholesalers often confuse margin and markup. Margin is profit as a share of the selling price; markup is profit as a share of the cost. The profit margin calculator shows both, so you price correctly.
You can work in three directions: enter cost and price to see the margin, enter cost and a target margin to get the selling price, or enter cost and a markup to get the price. For profit after rent, salaries and other fixed costs, use the Profit Calculator.
How to use the Profit Margin Calculator
- Choose what you know: cost & price, cost & margin, or cost & markup.
- Enter the cost of the product.
- Enter the selling price, target margin or markup.
- Read profit, margin, markup and selling price.
Formula
Margin = (Price − Cost) ÷ Price × 100 · Markup = (Price − Cost) ÷ Cost × 100
Example
A product that costs Rs 800 and sells for Rs 1,200 makes Rs 400 profit: a 33.3% margin and a 50% markup. To get a 40% margin on the same cost, the price must be 800 ÷ (1 − 0.40) = Rs 1,333.
Margin vs markup conversion table
| Markup | Margin |
|---|---|
| 20% | 16.7% |
| 25% | 20% |
| 33.3% | 25% |
| 50% | 33.3% |
| 66.7% | 40% |
| 100% | 50% |
Pricing tips for small businesses
- Include delivery, packaging and payment gateway fees in your cost.
- Check marketplace commission (Daraz, Amazon) before setting a margin.
- Use margin, not markup, when comparing with industry averages.
- Remember sales tax: use the VAT Calculator to add or remove it.
You may also need
People who use the Profit Margin Calculator often need these related tools too:
- Age Calculator: Find your exact age in years, months and days from your date of birth, plus the total days, weeks and hours you have lived and how long until your next birthday. Useful for forms, admissions and job applications that ask for age on a specific date.
- Percentage Calculator: Four percentage calculators on one page: X% of Y, X is what percent of Y, percentage increase or decrease, and adding or removing a percentage. Ideal for marks, discounts, salary raises and price changes.
Frequently asked questions
What is the difference between margin and markup?
Margin is profit divided by selling price. Markup is profit divided by cost. A 50% markup equals a 33.3% margin.
How do I calculate selling price from margin?
Divide the cost by (1 − margin ÷ 100). For a 25% margin on a Rs 600 cost, price = 600 ÷ 0.75 = Rs 800.
What is a good profit margin?
It depends on the industry. Retail grocery margins can be under 10%, while software and services can exceed 50%.
Can margin be more than 100%?
No. Margin is a share of the price, so it is always below 100%. Markup can be above 100%.
Is gross margin the same as net margin?
No. Gross margin only subtracts the product cost. Net margin also subtracts rent, salaries, tax and other expenses.
Is the Profit Margin Calculator free to use?
Yes. The Profit Margin Calculator on Custom Converter is completely free, with no sign-up, no daily limit and no watermark.
Does the Profit Margin Calculator work on mobile phones?
Yes. It is built mobile-first and works on Android phones, iPhones, tablets and computers in any modern browser, with no app to install.