E-commerce

Profit Margin Calculator

Turn a cost price and a selling price into profit, margin and markup - three different numbers that are easy to confuse.

2 inputs Free, no sign-up

Your figures

What the unit costs you, landed - including inbound shipping if you pay it.

What you receive for it. If you sell on a marketplace, use the amount after their fees, not the listed price.

Try an example

Result

Your result

Enter your figures and the result appears here.

Estimates only. Rates, fees and specifications change. Confirm against the official source before you rely on a figure — see our disclaimer.

About this calculator

Margin and markup are not the same number, and the gap between them grows fast. A 50% markup is a 33.3% margin. A 100% markup is a 50% margin. Quote the wrong one to a buyer, or plan around the wrong one, and the arithmetic stops working.

This calculator shows both from the same pair of figures, so the difference is visible rather than assumed.

How to use this calculator

  1. Enter what the unit costs you, including inbound shipping if you pay for it.
  2. Enter what you receive for it. Selling on a marketplace? Use the amount left after their commission, closing fee and shipping deduction — that is your real selling price.
  3. Read the profit, then compare the margin and markup figures.

The formula

Profit = Selling price - Cost price
Margin = Profit / Selling price x 100
Markup = Profit / Cost price    x 100

Both describe the same profit; they differ only in what they divide by. Margin is measured against the money coming in, markup against the money going out.

MarkupEquivalent margin
25%20.0%
50%33.3%
100%50.0%
200%66.7%
SymbolMeaningUnit
Cost price Landed cost of one unit ₹
Selling price What you receive for one unit ₹
Profit Selling price minus cost price ₹

Worked example

A phone case costs you ₹890 landed and you receive ₹1,599 for it.

Profit = 1,599 - 890        = 709
Margin = 709 / 1,599 x 100  = 44.34%
Markup = 709 / 890   x 100  = 79.66%

The same ₹709 of profit is a 44% margin or an 80% markup depending on which you quote.

Notes and limits

  • Margin can never reach 100%, because profit cannot exceed the selling price. Markup has no upper limit.
  • If your cost price is zero, markup has no meaning - you cannot express a profit as a share of nothing. The calculator shows 0% rather than an error.
  • For a marketplace listing, the selling price to use here is what lands in your account, not the price the customer sees. Marketplace commission, closing fees and shipping deductions all come off first.
  • This calculation is before tax. GST is collected on behalf of the government and is not part of your margin.

What this calculation assumes

  • Both figures are for a single unit and exclude GST.
  • Marketplace fees, if any, have already been deducted from the selling price.

Frequently asked questions

What is the difference between margin and markup?

Both measure the same profit against different bases. Margin divides profit by the selling price; markup divides it by the cost price. A 50% markup is a 33.3% margin, so quoting the wrong one materially overstates or understates how profitable a product is.

Is a good margin for accessories 30% or 50%?

It depends on the channel. Selling direct, accessory margins of 40-60% are common because the category supports it. On a marketplace, after commission, closing fees and shipping, the same product can land nearer 15-25%. Work out the post-fee selling price first, then judge the margin.

Should GST be included in the selling price here?

No. GST is collected for the government and passed on, so it is not revenue and not part of margin. Use the pre-GST figures for both cost and selling price.

Can margin be more than 100%?

No. Margin is profit as a share of the selling price, and profit cannot exceed the selling price. If you have calculated a margin above 100%, you have calculated markup.

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