EachCalculatorMargin Calculator
Calculate profit margin — the percentage of your selling price that is profit — or find the price needed to hit a target margin.
Profit
$40.00
Margin
40%
Price for a target margin
Required Selling Price
$100.00
How It Works
The margin formula
Margin = (revenue − cost) ÷ revenue × 100 — profit is expressed as a percentage of the selling price, not the cost. This is the key difference from markup.
Example Calculation
An item costing $60 sold for $100 has a $40 profit and a 40% margin (40 ÷ 100).
Common Mistakes
- Confusing margin with markup — they use different denominators (revenue vs. cost) and give different percentages for the same numbers. See the Markup Calculator for the distinction.
- Assuming a 50% margin means doubling the cost — a 50% margin actually requires pricing at twice the cost only when margin and markup happen to coincide at that specific number; in general they diverge.
Frequently Asked Questions
- What's the difference between margin and markup?
- Margin divides profit by the selling price (revenue). Markup divides profit by the cost. The same $40 profit on a $60 cost item selling for $100 is a 40% margin but a 66.7% markup.
- How do I price a product to hit a target margin?
- Use the 'price for a target margin' mode — enter your cost and desired margin percentage, and the calculator solves for the selling price needed.