What is Profit Margin Calculator?
Profit margin is profit as a share of the selling price: (price − cost) ÷ price. It is the number your profit and loss statement reports, the number lenders and buyers look at, and the number that has to absorb every fee, shipping charge and ad dollar. This calculator works in both directions. Enter your cost and selling price to see the margin you are actually running, along with the equivalent markup and total profit. Or enter a target margin and let it solve for the price, which is how you build a price list that guarantees the economics you need rather than hoping the market agrees.
Common Uses for Profit Margin Calculator
- Check the real margin on products you already sell
- Set prices from a target margin instead of copying competitors
- Compare margin across suppliers or product variations
- See how much room a discount leaves before you lose money
- Prepare margin figures for a loan application or marketplace pitch
Margin in the P&L, markup in the catalogue
Merchandisers think in markup because it applies to cost sheets; owners think in margin because it lands in the accounts. Keep both visible: a 45% target margin equals roughly a 1.82× multiplier, which is the number you can hand to whoever builds the price list.
Which costs belong in the cost figure
Use landed cost — supplier price plus freight, duty, brokerage and any inbound handling spread across the units in the shipment. Using the supplier price alone overstates margin by 15–25% on air-freighted goods. The landed cost calculator gives you that number in one screen.
Margin left after fees and ads
Marketplace referral fees (6.5–15%), payment processing (2.9–3.3% plus a fixed fee) and ad spend all come off revenue, not cost. A 55% gross margin can drop to a 20% net margin after a 15% referral fee, $5 shipping and $6 of ads. Run the numbers in the profit-per-order calculator before scaling spend.