Profit Margin Calculator
Calculate your profit, margin percentage, and markup from cost and selling prices. Or flip it round — enter a target margin and get the selling price you need to hit it.
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How to use this profit margin calculator
Calculate your profit margin percentage from cost price and selling price. Supports both markup and margin calculations.
- 1Enter your cost price
Type the total cost of materials, labour, and overheads for a job.
- 2Enter your selling price
Type the price you charge or plan to charge the customer.
- 3View the margin
See your profit margin as a percentage, plus the absolute profit amount.
- 4Adjust if needed
Try different selling prices to find the margin that works for your business.
Why this matters
Many tradespeople confuse markup with margin, which means they make less profit than they think. A 50% markup is only a 33% margin. Getting this right on every quote is the difference between a profitable business and one that just covers costs.
Frequently asked questions
What is a good profit margin for a small business?
It varies significantly by industry. Retail typically targets 2–5% net margin, while professional services (consultants, agencies) often achieve 15–30%. As a general benchmark, a net profit margin above 10% is considered healthy for most small businesses. Gross margins are always higher — focus on net margin once all costs are accounted for.
What is the difference between profit margin and markup?
Margin is profit expressed as a percentage of the selling price. Markup is profit expressed as a percentage of the cost price. For example: cost £60, selling price £100. Profit is £40. Margin = £40 / £100 = 40%. Markup = £40 / £60 = 66.7%. The key difference is the denominator — always clarify which figure is being discussed.
How do I calculate gross profit margin?
Gross profit margin = (Selling price − Cost of goods) ÷ Selling price × 100. This calculator uses that formula directly. For example, if you sell a product for £150 that costs £90 to produce, your gross margin is (£150 − £90) ÷ £150 × 100 = 40%. Note that net margin also deducts overhead costs such as rent, salaries, and admin.
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