Free calculator
Profit margin calculator
Gross margin, net margin and markup in one place.
Your numbers
Product, fulfilment, payment fees.
Ads, software, staff, rent.
- Gross profit
- –
- Gross margin
- –
- Markup
- –
- Net profit
- –
- Net margin
- –
Margins use the numbers you enter; nothing is stored.
Next step
What is a business with this profit worth?
Turn your net profit into a realistic value range.
Profit margin formulas
- Gross profit = revenue − COGS
- Gross margin = gross profit ÷ revenue
- Markup = gross profit ÷ COGS
- Net profit = gross profit − operating expenses
- Net margin = net profit ÷ revenue
Margin and markup are not the same: a 50% markup is only a 33% margin.
Questions, answered
Frequently asked questions
How do you calculate profit margin?
Net profit margin = (revenue − all costs) ÷ revenue × 100. Gross margin only subtracts the cost of goods sold.
What is a good profit margin?
It depends on the model: content sites and SaaS often run 50% to 80% net, ecommerce commonly 10% to 25%, agencies 15% to 30%.
What is the difference between margin and markup?
Margin divides profit by the selling price; markup divides it by cost. Markup is always the larger number.
Why do margins matter when selling a business?
Buyers pay a multiple of profit. Higher, stable margins mean more profit per dollar of revenue and usually a higher multiple.
Keep going