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Profit Margin Calculator
Margin and markup from cost and selling price — and why the two numbers are not the same.
Profit margin
How it works
Profit = selling price − cost Margin = profit ÷ selling price × 100 Markup = profit ÷ cost × 100
Worked example: cost ₹700, selling price ₹1,000. The profit is ₹300 per unit, the margin is 30.00% (₹300 of each ₹1,000 sale) and the markup is 42.86% (₹300 added to a ₹700 cost). Same profit, different base — that is why the two percentages differ.
Frequently asked questions
What is the difference between margin and markup?
Margin divides profit by the selling price; markup divides profit by the cost. A 30% margin on a ₹1,000 sale is the same ₹300 profit as a 42.86% markup on a ₹700 cost.
Which one should I use for pricing?
Use margin when you want to know what share of each sale you keep. Use markup when you want to set a price by adding a percentage to your cost.
Can margin be over 100%?
No. Margin can never pass 100%, because profit cannot exceed the selling price. Markup, by contrast, has no such ceiling.
What if the selling price is below cost?
Then profit is negative: the tool shows a negative margin and markup, which means a loss on every unit.