SellersCalc

Pricing math

Profit Margin Calculator

Margin is the share of every sale you actually keep — the number every other decision in your store depends on.

Profit margin = (revenue − cost) ÷ revenue × 100. Sell something for $100 that costs $60 and your profit is $40, giving a 40% margin — you keep 40 cents of every revenue dollar. Margin is measured against the selling price; markup measures the same profit against cost (that $40 is a 66.7% markup). Enter your revenue and cost to get margin, profit, and the equivalent markup at once.

Profit Margin Calculator — your numbers

Profit margin

40.0%

Profit

$40.00

Equivalent markup

66.7%

Estimate only. Results reflect exactly the numbers you enter — verify against your own accounting before making pricing decisions.

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Worked examples

Healthy DTC product

Revenue (selling price) $100.00
Total cost $60.00
Profit margin 40.0%
Profit $40.00
Equivalent markup 66.7%

A 40% margin — solid for e-commerce after product and fulfillment costs.

Thin reseller margin

Revenue (selling price) $25.00
Total cost $21.00
Profit margin 16.0%
Profit $4.00
Equivalent markup 19.0%

A 16% margin leaves little room for ads, returns, or overhead.

Frequently asked questions

What is a good profit margin for e-commerce?

Most healthy e-commerce stores run 30–50% gross margin on physical products. Below ~20% there is usually not enough room to pay for advertising, returns and overhead; digital products often exceed 80%. Judge your margin against your own cost structure, not a universal number.

What is the difference between gross and net margin?

Gross margin subtracts only the direct costs of the product sold (COGS, fees, shipping). Net margin also subtracts overhead: salaries, software, rent, marketing. This calculator computes the margin for whatever cost figure you enter — enter fully-loaded costs and you get closer to net.

Why is margin different from markup?

They divide the same profit by different bases. Margin divides by price; markup divides by cost. A $40 profit on a $100 sale is a 40% margin but a 66.7% markup on the $60 cost. Mixing them up is one of the most common — and expensive — pricing mistakes.

How do I increase my profit margin?

Three levers: raise prices (test in small steps — demand often drops less than feared), cut product costs (negotiate suppliers, larger order quantities, cheaper freight), or change mix (push higher-margin products in bundles and ads). Small moves compound: +5% price and −5% cost together can add 10+ points of margin.

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Part of the Pricing & Margins collection.