Margin Calculator
Calculate profit margin, markup percentage, and discount savings instantly. Free online calculator for e-commerce and retail businesses.
Enter cost and selling price to see results.
Frequently Asked Questions
What is the difference between margin and markup?
Margin is the percentage of the selling price that is profit, calculated as (Profit / Selling Price) x 100. Markup is the percentage added to the cost price, calculated as (Profit / Cost Price) x 100. For example, if you buy an item for $50 and sell it for $100, your margin is 50% but your markup is 100%.
How do I calculate profit margin?
Profit margin is calculated by dividing the profit (selling price minus cost price) by the selling price, then multiplying by 100. The formula is: Margin % = ((Selling Price - Cost Price) / Selling Price) x 100.
What is a good profit margin?
A good profit margin varies by industry. In retail, a 5-10% net margin is typical. In software and technology, margins of 20-40% are common. For luxury goods, margins can exceed 50%. The key is benchmarking against your industry average and ensuring your margin covers all operating costs.
How do I convert markup to margin?
To convert markup to margin, use the formula: Margin % = Markup % / (100 + Markup %). For example, a 50% markup equals a 33.33% margin: 50 / (100 + 50) = 0.3333 or 33.33%.
Why is my margin always lower than my markup?
Margin is always lower than markup because they use different bases for calculation. Margin divides profit by the larger selling price, while markup divides profit by the smaller cost price. Since the denominator is larger for margin, the resulting percentage is always lower.