Calculate gross margin, markup, and profit from cost and revenue. Switch between finding margin, markup, revenue, or cost — the essential tool for pricing decisions.
Pricing Inputs
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%
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Gross Margin
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Markup
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Cost
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Revenue
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Gross Profit
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Total Profit (×units)
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Cost per Unit
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Selling Price
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Gross Profit per Unit
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Gross Margin %
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Markup %
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Total Revenue (×units)
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Total Cost (×units)
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Total Gross Profit
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FAQ
What is gross margin?
Gross Margin = (Revenue − Cost) / Revenue × 100. It expresses profit as a percentage of revenue. A 40% margin means 40 cents of every dollar of revenue is gross profit.
What is the difference between margin and markup?
Margin is calculated on selling price: Margin = Profit/Revenue. Markup is calculated on cost: Markup = Profit/Cost. A 40% margin equals a 66.7% markup (because $40 profit on $60 cost = 66.7% markup).
What is a good gross margin?
Depends heavily on industry: Software (70-80%+), Retail (25-50%), Manufacturing (20-40%), Grocery (15-30%), Restaurants (60-70% on food but low net). Compare against your specific industry benchmarks.
Why does margin matter more than markup for pricing?
Margin tells you what fraction of revenue is profit — the most useful metric for financial statements and comparisons. Markup helps set prices from cost. Both are needed; just do not confuse them.