What Is a Good Profit Margin?
As a rough rule, a net profit margin around 10% is considered average, 20% or more is good, and under 5% is low — but it varies widely by industry. Margin is the share of revenue left as profit after costs.
Profit Margin Calculator
Verified formula Updated Jun 2026 Private — runs on your device
Verified formula
Private
Profit margin
20.00%
- Profit
- ₹200.00
- Markup
- 25.00%
For general information only — not financial, tax, legal or medical advice. Verify before you rely on it.
How to use the Profit Margin Calculator
The Profit Margin Calculator works out your profit margin, along with 2 related figures in an instant. Enter cost price and selling price and the result updates as you type — it is free, needs no sign-up, and runs entirely in your browser so your figures stay private.
- Enter the cost price.
- Enter the selling price.
- Read off your profit margin, together with profit and markup — the calculator updates automatically, with no button to press.
Worked example
For example, with cost price of ₹800 and selling price of ₹1,000, the profit margin is 20.00%.
| Cost price | ₹800 |
|---|---|
| Selling price | ₹1,000 |
| Profit margin | 20.00% |
|---|---|
| Profit | ₹200.00 |
| Markup | 25.00% |
Results are estimates for educational use, not professional advice.
Key terms explained
- Markup
- The amount added to cost to set the selling price, expressed as a percentage of cost.
- Profit margin
- Profit as a percentage of revenue — how much of each sale is kept as profit.
Frequently asked questions
Margin is profit as a percentage of the selling price, while markup is profit as a percentage of the cost price. The same profit gives a lower margin than markup.
Profit margin = (selling price − cost price) ÷ selling price × 100. It shows what share of each sale is profit after covering the cost of the item.
It varies by industry — retail margins are often thin while software can be very high. Compare your margin to peers in your sector rather than to a fixed number.
No. It uses the direct cost you enter. To find net margin, include overheads such as rent, salaries and marketing in your cost figure.
Enter the cost price. Enter the selling price. Read off your profit margin, together with profit and markup — the calculator updates automatically, with no button to press.
Related guides
Profit Margin vs Markup: What's the Difference?
Margin and markup are easy to confuse but mean very different things — and mixing them up can quietly destroy your pricing. Here's how each works, how to convert between them, and how to price for profit.
Profit Margin Table: Profit margin by Cost price
Reference table of profit margin for Profit Margin across a range of cost price values — exact, engine-computed figures you can read off at a glance.
How to Calculate Profit Margin: Formula, Steps & Examples
Learn how to calculate Profit Margin — the formula explained step by step, with worked examples and a free calculator to check your answer.