Free Profit Margin Calculator
Profit margin is the single most important pricing number in your business. This calculator gives you both the profit amount and the margin percentage instantly — and lets you flip the calculation to work out the selling price required to hit a target margin.
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About the Profit Margin Calculator
The profit margin formula
Profit margin = (Selling Price − Cost Price) / Selling Price × 100. It answers the question: for every dollar the customer pays, how many cents do you keep? A 40% margin means you keep $0.40 of every $1.00 in revenue.
Why margin (not markup) is what investors look at
Margin is expressed as a percentage of revenue, which is how P&L statements are written. Markup is expressed as a percentage of cost. Two very different numbers — a 100% markup is only a 50% margin. When a buyer, lender or investor asks for your margin, they mean margin.
Healthy margin ranges by industry
Software and SaaS: 70–85%. Professional services: 40–60%. Retail: 20–50%. Restaurants: 5–15%. Compare your number to your industry benchmark, not to an arbitrary target.
Frequently asked questions
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