Business
Profit Margin Calculator
Enter selling price, unit cost, and optional fixed costs to estimate profit margin and break-even sales volume.
Inputs
Results
Useful next checks
- Check the inputs before relying on the result.
- Try a second scenario to compare outcomes.
- Read the guide below for context.
# Profit Margin Calculator
Use this profit margin calculator to calculate gross profit, margin, markup, and break-even units from selling price, unit cost, and fixed costs.
What this calculator does
The calculator shows the profit made on each unit, the profit margin as a percentage of the selling price, the markup as a percentage of cost, and the number of units needed to cover fixed costs.
How it works
Gross profit is `selling price - unit cost`. Margin is `gross profit / selling price x 100`. Markup is `gross profit / unit cost x 100`. Break-even units are fixed costs divided by gross profit per unit, rounded up.
Example calculation
If a product sells for 50 and costs 30, gross profit is 20. The margin is 40%, markup is 66.67%, and 1,000 of fixed costs require 50 units to break even.
How to use the result
Use the margin and markup figures when comparing price changes, supplier costs, discounts, and campaign offers. The break-even result is a simple planning estimate, not a full profit and loss forecast.
Assumptions and limitations
This calculator uses one unit cost and one selling price. It does not include tax, payment fees, shipping, refunds, stock loss, tiered pricing, or variable overheads unless you include them in the unit cost.
FAQs
Is margin the same as markup?
No. Margin compares profit with selling price, while markup compares profit with cost.
Why must price be higher than cost?
The v1 calculator is designed for positive gross profit. If price is below cost, the result is a loss scenario rather than a margin planning result.
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Frequently asked questions
What is profit margin?
Profit margin is profit divided by selling price, shown as a percentage.
What is markup?
Markup is profit divided by cost, shown as a percentage.