BUSINESS CALCULATOR

Profit Margin & Markup Calculator

Use this profit margin and markup calculator to compare profit as a percentage of selling price with markup as a percentage of cost. Enter your own values, then select Calculate to see the result.

Reviewed Oct 15, 2026Formula shownRuns in your browser

Your inputs

Change any value. Use one currency consistently for all money fields.

currency
currency

Enter your numbers, then tap Calculate.

The currency selector changes the displayed symbol only. It does not convert exchange rates.

Your result

A transparent estimate based on the assumptions you enter.

Gross margin
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Markup on cost
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Margin uses selling price as the denominator; markup uses cost.
FormulaGross margin % = (selling price − cost) ÷ selling price × 100. Markup % uses cost as the denominator instead.

What this result means

The headline result is gross margin percentage, which shows gross profit as a share of selling price.

How the Profit Margin & Markup Calculator works

Gross margin uses selling price as the denominator; markup uses cost. They are not the same.

The calculator does not fetch live prices or rates. That is intentional: you provide the tariff, price, rate or cost that actually applies to your situation, which makes the assumptions visible and avoids presenting stale market data as current.

How to get a more useful estimate

  • Do not confuse markup with margin; a 50% markup is not a 50% margin.
  • Use fully loaded direct cost if you want the margin to reflect all variable production costs.
  • Track margin after discounts because actual selling price may be lower than list price.

Scenario check

Use both percentages when discussing pricing because they answer different questions. Margin describes gross profit as a share of selling price, while markup describes gross profit relative to cost. When a price changes, recalculate both rather than mentally converting between them; small denominator differences can create surprisingly large percentage differences.

Important limitations

  • Overhead, tax, financing, and operating expenses are not included in gross margin.
  • The calculator uses one cost and one selling price.
  • Negative margins are possible if selling price is below cost.
Planning note: SmartCostTools provides educational estimates, not personalized financial, tax, legal, engineering, energy, lending or professional advice. Verify major decisions with current local information and qualified professionals where appropriate.

Frequently asked questions

What is the difference between markup and margin?

Margin divides gross profit by selling price; markup divides gross profit by cost.

Can gross margin exceed 100%?

Not with a positive selling price and non-negative cost. If your inputs imply that, recheck them.

Is gross margin the same as net profit margin?

No. Net profit margin also accounts for operating expenses, financing, taxes, and other costs.