Profit margin calculator

Margin and markup are not the same

Both start from the same profit. Margin divides it by the price; markup divides it by the cost. Cost 60, price 100: margin 40%, markup 66.67%. A 50% markup is only a 33.33% margin.

The formulas

• Profit = price − cost
• Margin % = profit ÷ price × 100
• Markup % = profit ÷ cost × 100
• Price for a target margin = cost ÷ (1 − margin)

For a service business, count your time as a cost too, at the hourly rate you need; otherwise every margin looks better than it is.

QuickBilling's profit and loss report shows your real revenue and costs, so you can check the margin you actually make. See reports.