Profit Margin Calculator
Find the ideal selling price for your product or service. Enter the cost, fixed expenses and taxes (%) and your desired profit margin — we use the markup divisor method to guarantee your real margin.
Margin on cost vs. markup divisor
Many sellers make the mistake of adding the margin to the cost (e.g. Cost + 30%). That yields a smaller real profit than planned.
The correct formula is: Price = Cost / [1 - (Expenses % + Margin %)], so your net margin is exactly the planned percentage of the final price.
Worked example
Cost $50, expenses 15% and target margin 30%. Markup divisor = 1 - (0.15 + 0.30) = 0.55. Price = $50 / 0.55 = $90.91. Real net profit = $27.27 (exactly 30% of the price).
Frequently asked questions
Difference between margin and markup?
Margin is profit as a % of the selling price; markup is the multiplier over cost. The tool shows both.
Should taxes go in expenses?
Yes. Add taxes, card fees and fixed costs into the expenses (%) field.
Why can't I use 100% margin?
Because expenses + margin must be under 100% for the markup divisor to exist.