Free tool
Calculate gross profit and profit margin from revenue and cost. Use it before you set a selling price or judge a channel.
Profit margin = (Revenue − Cost) ÷ Revenue. Gross profit = Revenue − Cost.
A product sells for 2,000. Cost is 1,300. Gross profit is 700. Margin is 700 ÷ 2,000 = 35%.
Profit margin is the share of revenue that remains after a defined cost. Gross margin usually uses product cost (COGS). Net margin subtracts a wider set of costs. This calculator uses the gross definition: revenue minus the cost you enter. If you include shipping, payment fees or ads in cost, say so in your own notes — the formula will not guess.
Margin is a ratio, not a currency amount. Two products can produce the same profit rupees or dollars and very different margins. A 200 profit on 400 revenue is 50%. A 200 profit on 2,000 revenue is 10%. Price and mix decisions should look at both the cash profit and the percentage.
Markup is profit divided by cost. Margin is profit divided by selling price. A 50% markup on a 100 cost produces a 150 price and a 33.3% margin. Mixing the two words is a common pricing error. Use the markup calculator if you price from cost, and this calculator if you already have a selling price.
Raise price only when the offer still converts. Reduce cost with supplier terms, pack size or inbound freight. Cut marketplace fees by moving volume to a lower-fee channel when that channel can actually sell. Watch returns — a high margin that comes back is not a high margin. Pair this tool with the marketplace fee and shipping cost calculators before you lock a price.
No. The calculation runs in your browser. Nothing is stored or transmitted.
Use any currency as long as every input uses the same one. The math does not depend on a currency code.
Profit margin = (Revenue − Cost) ÷ Revenue.
Convert cost into a selling price using a markup percentage, and see the implied profit margin.
Work backwards from cost and a target margin to the selling price you need.
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Gross, contribution and net margin answer different questions. Channel fees, shipping and returns sit between list price and cash. Worked numbers included.
Markup is the add-on over cost. Margin is profit as a share of selling price. Mixing them up is a common pricing error. Formulas and a conversion table.
AOV is revenue divided by orders. Bundles and free-shipping thresholds can raise it, but discounts that crush conversion or contribution are not a win.