Profit margin calculator
Enter what you charged and what it cost you, and see the profit, the margin, and the markup — three numbers people routinely confuse for each other.
Estimate only. Figures update as you type. Not tax advice — see the note at the bottom of this page.
Margin and markup are not the same number
Margin measures profit against revenue. Markup measures the same profit against cost. Buy for $50 and sell for $100 and you have a 50% margin but a 100% markup. Confusing the two is one of the most reliable ways for a small business to underprice itself, because a 30% markup produces a much thinner margin than a 30% margin does.
Gross margin isn't what you keep
This calculates gross margin, which is revenue minus the direct cost of delivering the work. It doesn't account for overheads, your own unpaid time, or tax. Net margin, after all of that, is a substantially smaller number and the one that determines whether a business is actually viable.
What a healthy margin looks like
It varies enormously by industry. Service businesses selling expertise often run high gross margins because the main input is time. Businesses reselling physical goods run much thinner ones. Comparing yourself to your own trend over time is more informative than comparing to a general benchmark.
Common questions
What's the difference between margin and markup?
Margin is profit divided by revenue. Markup is profit divided by cost. For the same transaction, markup is always the larger percentage.
Is a 50% margin good?
It depends entirely on the industry. Software and consulting frequently exceed it. Retail and food service rarely approach it. Context matters more than the number.
Does this include my own labour?
Only if you entered it as a cost. Many freelancers omit their own time, which makes the margin look far healthier than it is.