📊 Profit Margin Calculator

Gross margin, net margin and markup — from cost and selling price

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Margin Analysis

Gross Profit Margin—
Markup—
Profit Per Unit—
💡 Margin and markup are different! A 40% margin = 66.7% markup. Mixing them up is one of the most common (and costly) small business pricing errors.

Margin vs Markup — Know the Difference

Margin = profit ÷ selling price. Markup = profit ÷ cost. A product costing £60 sold for £100 has a £40 profit — that's a 40% margin but a 66.7% markup. Confusing the two systematically underprices your products.

Typical UK Margins by Sector

  • Retail (general): 20–50% gross margin
  • Food & hospitality: 65–70% gross (but low net after labour)
  • Construction: 15–25% gross
  • Professional services: 50%+ gross
  • E-commerce: 30–45% gross

Setting Prices From a Target Margin

To achieve a target margin: selling price = cost ÷ (1 − margin). For a £60 cost and 40% target margin: £60 ÷ 0.60 = £100. Never calculate it as cost × (1 + margin) — that gives you markup, not margin.