Gross Margin Calculator

A Gross Margin Calculator tells you how much of every sale you actually keep after covering the direct cost of the product or service.

Enter a cost and a price to read your profit, margin, and markup, or flip to target mode and let the tool solve the price you would need to hit a margin you have in mind.

Margin is not markup

Gross profit is simply price minus cost, but there are two ways to express it as a percentage and they are not the same.

Margin measures profit against the selling price, while markup measures the same profit against the cost.

That difference trips people up constantly — a 50% markup is only a 33.3% margin — so seeing both side by side keeps conversations with suppliers honest.

Pricing from a target margin

Sometimes you know the margin you want and need to reverse into a price.

Target mode divides your cost by one minus the margin, which gives the exact price that leaves the right slice of profit on top.

It is a fast way to build a price list, and you can express any single figure as a share with a Percentage Calculator.

Fitting margin into real pricing

Margins are usually calculated on the pre-tax price, so it helps to strip tax out first.

A Sales Tax Calculator recovers the net price from a tax-inclusive total, and if you sell your time rather than goods an Hourly Rate Calculator helps you set a rate that carries the margin you are aiming for.

Frequently Asked Questions

What is the difference between margin and markup?

Both start from the same gross profit, which is price minus cost. Margin divides that profit by the selling price, while markup divides it by the cost. Because the denominators differ, markup is always the larger percentage of the two.

How do I price a product to hit a target margin?

Switch to target mode and enter your cost and the margin you want. The calculator uses price equals cost divided by one minus the margin, giving the exact selling price that leaves your desired margin on top.

Why is my markup higher than my margin?

Markup compares profit to the smaller number, the cost, while margin compares it to the larger number, the price. The same profit expressed against a smaller base always yields a larger percentage, so markup exceeds margin.

Is my data sent anywhere?

No. Every calculation happens locally in your browser with JavaScript. Nothing you type is uploaded, logged, or stored, and the tool keeps working offline once the page has loaded.