What is Profit Margin?
Better Insights = Better Business Decisions
How to Calculate Profit Margin
- Determine your COGS (cost of goods sold). For example $30
- Determine your revenue (how much you sell these goods for, for example, $50)
- Calculate the gross profit by subtracting the cost from the revenue. $50 – $30 = $20
- Divide gross profit by revenue: $20 / $50 = 0.4.
- Express it as percentages: 0.4 * 100 = 40%.
- This is how you calculate profit margin… or simply use our gross margin calculator!
Use the Profit Margin calculator xendoo® developed just for you and see what is possible with your business.
Gross Margin Formula
The formula for gross margin percentage is as follows:
Crunch Your Numbers
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The Profit Margin Calculator
This margin calculator will be your best friend if you want to find out an item’s revenue, assuming you know its cost and your desired profit margin percentage.