How to use the Profit Margin Calculator
- Choose whether you want the margin, or the selling price for a target margin.
- Enter the cost price, and either the selling price or your target margin.
Formula
Margin % = (Selling price − Cost) ÷ Selling price × 100
Selling price for a target margin = Cost ÷ (1 − Margin ÷ 100)
Markup % = Margin ÷ (100 − Margin) × 100
Margin is measured on the selling price
Profit margin tells you what share of each rupee of sales is profit. If you sell for ₹1,000 and it cost you ₹750, ₹250 is profit — a 25% margin. The same deal is a 33.33% markup, because markup is measured against the ₹750 cost.
| Target margin | Markup on cost | Price if cost is ₹100 |
|---|---|---|
| 10% | 11.11% | ₹111.11 |
| 20% | 25% | ₹125 |
| 25% | 33.33% | ₹133.33 |
| 30% | 42.86% | ₹142.86 |
| 40% | 66.67% | ₹166.67 |
| 50% | 100% | ₹200 |
Worked examples
Cost ₹750, selling price ₹1,000
- Profit = 1,000 − 750 = ₹250
- Margin = 250 ÷ 1,000 × 100 = 25%
- Markup = 250 ÷ 750 × 100 = 33.33%
25% margin (33.33% markup)
Price for a 30% margin on a cost of ₹750
- Selling price = 750 ÷ (1 − 0.30) = 750 ÷ 0.70
Sell at ₹1,071.43
Important notes
- A margin of 100% or more is impossible — it would require a cost of zero or less.
Frequently asked questions
What is a good profit margin?
It depends heavily on the trade. High-volume retail and distribution often run on single-digit or low double-digit margins; services and branded products can be much higher. Compare against businesses like yours and make sure the margin covers your overheads.
Is margin calculated before or after GST?
For registered businesses, calculate margin on prices excluding GST so the tax you pass on doesn't inflate your numbers.