What is the difference between markup and margin?

Markup is the percentage added to the *cost* to set the price. Margin is the percentage of the *selling price* that is profit. A 50% markup results in a 33.3% profit margin.

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Finance

Profit Margin Calculator - Business Profitability

Calculate gross, operating, and net profit margins to understand the financial health of your products or business.

Revenue is the 'top line' of a business, but profit margins tell the 'real' story. A company making $1 million in sales might only be keeping $10,000 after all costs are paid. Our Margin Calculator helps you analyze these layers of profitability, distinguishing between the cost of the product itself (Gross Margin) and the overall health of the business after all taxes and overhead (Net Margin).

Revenue

COGS

Operating expenses

Other expenses (tax/interest/etc.)

Currency

Net margin

35%

Net profit: €35,000.00

Revenue€100,000.00

Gross margin60%

Operating margin40%

Gross Profit€60,000.00

Operating Profit€40,000.00

How it Works

The tool calculates profit at each level (Gross, Operating, Net) and divides it by the total revenue to provide three distinct margin percentages.

Calculation Formula

Margin % = (Profit / Revenue) × 100

Calculation Examples

1. **Standard Retail**: $100 Revenue, $60 COGS. Gross Margin = **40%**.

Why use this tool in your daily life?

Optimize your pricing. This service helps you identify which products are actually making you money and which might be dragging down your bottom line, allowing you to make data-driven decisions for your business growth.