Free profit margin calculator
Gross margin is profit as a percentage of the selling price; markup is profit as a percentage of cost. An item bought for ₹800 and sold for ₹1,000 earns ₹200: a 20% margin but a 25% markup. Enter prices before GST, because GST is collected for the government and is not part of your profit.
Learn more: Gross margin vs markup · Profit and loss statement
- Profit per unit
- ₹200.00
- Gross margin
- 20.00%
- Markup
- 25.00%
To earn a 25% margin on a ₹800.00 cost, sell at ₹1,066.67 before GST.
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Profit margin calculator: FAQ
What is the difference between margin and markup?
Margin is profit divided by the selling price; markup is profit divided by cost. Buying at ₹800 and selling at ₹1,000 gives ₹200 profit: a 20% margin and a 25% markup. The same profit always shows a higher markup than margin.
Should I include GST when calculating margin?
No. For a GST-registered business, output GST is collected on behalf of the government and input GST is usually claimed back as credit, so calculate margin on prices before GST.
How do I price for a target margin?
Divide cost by (1 − target margin). For a ₹800 cost and a 25% margin: 800 ÷ 0.75 = ₹1,066.67 before GST.