How to use this Profit Margin calculator
Margin and markup are the two numbers every seller needs but many confuse, and mixing them up can quietly erode profitability. The same profit looks very different depending on which one you measure.
This calculator takes your cost and selling price and returns the profit, margin and markup, so you can price products with clarity rather than guesswork.
Margin versus markup
Margin is profit as a percentage of the selling price: profit ÷ selling price. Markup is profit as a percentage of the cost: profit ÷ cost price.
Markup is always the larger number for the same profit, which is why quoting markup as if it were margin overstates how much you actually keep.
Pricing for a target margin
If you need a specific margin, you cannot simply add that percentage to cost — that gives a markup. To hit a 25% margin, for instance, the selling price must be cost ÷ (1 − 0.25).
Use the calculator to test selling prices until the margin matches your goal.
Why margin matters
Margin reflects how much of every rupee of revenue becomes profit, making it the better measure for comparing products and judging the health of your business.
Tracking margin protects you when discounts and costs change, ensuring you do not sell at an unintended loss.