Profit Margin Calculator & Analysis Tool
Calculate gross and net profit margin to measure your business profitability. Free tool for pricing and cost analysis.
Markup vs Margin Comparison Table
Margin values at common markup rates for 100 ₺ cost
| Markup % | Selling Price | Profit | Margin % |
|---|---|---|---|
| 20% | 120,00 ₺ | 20,00 ₺ | 16,67% |
| 30% | 130,00 ₺ | 30,00 ₺ | 23,08% |
| 40% | 140,00 ₺ | 40,00 ₺ | 28,57% |
| 50% | 150,00 ₺ | 50,00 ₺ | 33,33% |
| 100% | 200,00 ₺ | 100,00 ₺ | 50,00% |
This tool is for informational purposes only and does not replace financial or business consulting. Also consider market conditions and regulations when making pricing decisions.
The profit margin calculator measures how much of a business's sales revenue goes to costs and how much remains as profit. It is one of the most critical performance indicators for building a correct pricing strategy and tracking the financial health of a business.
Gross Profit Margin vs. Net Profit Margin
Gross profit margin shows the ratio remaining after only the cost of goods sold (COGS) is deducted, while net profit margin represents the final profitability after all operating expenses such as rent, staff, marketing and taxes are deducted. Both metrics need to be tracked regularly for sustainable growth.
How Is Profit Margin Calculated?
Profit Margin = [(Selling Price - Cost) / Selling Price] × 100
The basic profit margin formula gives you your profit rate as a percentage (%). If you have a target profit margin, you can also determine your ideal selling price by adding this rate to your cost.
Methods to Improve Profit Margin
There are two fundamental ways to improve profit margin: either increase operational efficiency and reduce costs, or raise the selling price by increasing brand value and product quality. Additionally, reducing inventory management errors and focusing on high-margin products will rapidly improve your profitability.
Formulas: How to Calculate Markup and Margin?
Gross Margin Formula
Gross Margin % = (Selling Price - Cost) / Selling Price × 100
Markup Formula
Markup % = (Selling Price - Cost) / Cost × 100
Selling Price from Markup
Selling Price = Cost × (1 + Markup / 100)
Selling Price from Margin
Selling Price = Cost / (1 - Margin / 100)