About the Gross Profit Margin Calculator

Gross profit margin is the share of revenue left after paying for the goods you sold — before rent, salaries, and marketing. It is the first health check of any business model: (Revenue − COGS) ÷ Revenue. A 40% margin means every dollar of sales contributes 40 cents toward overhead and profit, which is why margin is the number investors and lenders look at first.

Margin vs markup

The most common pricing mistake is treating margin and markup as the same. Margin is profit over selling price; markup is profit over cost. A product costing $60 sold at $100 yields a 40% margin but a 66.7% markup. Retailers who price by markup alone often undercharge without realizing it — this calculator reports both so you can price with either perspective and see exactly what the other implies.