Unit pricing and gross profit

Profit Margin and Markup Calculator

Find margin and markup from a selling price, or calculate a price that meets your target percentage.

Cost and pricing

Use consistent unit costs and selling prices, excluding collected sales tax. Target prices round upward to the next cent so the achieved percentage meets or exceeds your target. Target margin must be below 100%; markup may exceed 100%.

Estimate break-even volume using fixed costs and unit contribution.

Optional break-even volume

For this estimate, the unit cost above must include all variable costs and exclude the fixed costs entered here. Then price minus unit cost is contribution per unit. Break-even units round upward; a nonpositive contribution cannot cover positive fixed costs.

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Margin versus markup: a simple example

If a product costs $60 and sells for $100, gross profit is $40. Margin divides $40 by the $100 selling price: 40% margin. Markup divides $40 by the $60 cost: 66.67% markup. The same profit gives different percentages because the denominators differ.

A 25% margin on a $60 cost requires $80 selling price. A 25% markup on the same cost requires $75. Margin and markup are not interchangeable.

Formulas

Gross profit = price - cost. Margin = profit / price × 100. Markup = profit / cost × 100. Target-margin price = cost / (1 - margin / 100). Target-markup price = cost × (1 + markup / 100).

Losses produce negative percentages. Margin is undefined at zero selling price; markup is undefined at zero cost. A positive cost is required in target-price modes. Results use exact decimal arithmetic for prices and cents.

Break-even volume = fixed costs / positive contribution per unit, rounded up to a whole unit. With no fixed costs and nonnegative contribution, zero units cover costs. No sales-volume or demand forecast is implied.

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