Profit Margin Calculator — Bustech.site

Business Tool / Profitability

Profit Margin Calculator

Know What You Actually Earn From Every Sale

Enter your cost and selling price to see your profit amount and margin instantly.

Simple numbers. Clear decisions.

Calculate Your Profit

Your Profit

—

Enter your cost and selling price to see results.

Profit Margin
—
Markup
—
Cost Share
—

Where Your Selling Price Goes

Enter your cost and selling price above to see the breakdown here.

What Does Profit Margin Actually Tell You?

Profit margin tells you what percentage of your selling price remains as profit after the cost of the product or service has been paid for. It’s a quick way to see how much of every sale you actually keep, rather than just how much money changed hands.

Profit Amount
The money left over: selling price minus cost price, in your currency.
Profit Margin
That profit amount, shown as a percentage of your selling price.
Markup
That same profit amount, shown as a percentage of your cost price instead.

Margin and Markup Are Not the Same

Cost = $40
Selling Price = $100
Profit = $60

Margin

60%

$60 profit ÷ $100 selling price

Markup

150%

$60 profit ÷ $40 cost price

Both numbers describe the same $60 profit — the difference is what you’re dividing it by. Margin measures profit against what the customer paid; markup measures it against what the item cost you. Because the selling price is always the larger number in a profitable sale, margin will always come out lower than markup on the same transaction.

Where This Number Helps

  1. Product Pricing

    Check whether your selling price leaves enough margin before you commit to it.

  2. Retail

    Understand the profit generated from each individual sale on the shop floor.

  3. E-commerce

    Estimate profitability before setting product prices across your online store.

  4. Services

    Check how much of your client price remains after direct costs are covered.

Quick Example

Cost Price
$25
Selling Price
$40
Profit
$15
Margin
37.5%
Markup
60%

How Your Result Is Calculated

Selling Price—
− Cost Price—
= Profit—
Profit ÷ Selling Price—
× 100 = Profit Margin—

Frequently Asked Questions

What is profit margin?

Profit margin is the share of your selling price that remains as profit once the cost of the product or service has been paid for. It’s expressed as a percentage of the selling price.

How do I calculate profit margin?

Subtract your cost price from your selling price to get the profit amount, then divide that profit by the selling price and multiply by 100.

What is the difference between margin and markup?

Margin divides profit by the selling price. Markup divides that same profit by the cost price instead — which is why markup is always a larger percentage than margin on the same sale.

Can profit margin be negative?

Yes. If your selling price is lower than your cost price, the sale results in a loss, and the margin is shown as a negative percentage.

What is a good profit margin?

There’s no single universal figure. A healthy margin depends heavily on your industry, cost structure, pricing model and business circumstances, so it’s best judged against others in your own sector rather than a fixed target.