Calculate gross, operating, and net profit margins. See the difference between margin and markup at a glance.
Enter your total revenue and each cost category. The calculator instantly shows three margin levels: gross (revenue minus COGS), operating (minus operating expenses), and net (minus everything). The bar chart visualizes where every dollar of revenue goes.
Gross margin measures production efficiency — how much you keep after direct costs. Operating margin adds overhead like rent, salaries, and marketing. Net margin is the bottom line after interest, taxes, and everything else.
Margin and markup both measure profitability but use different denominators. Margin divides profit by the selling price (revenue). Markup divides profit by the cost. A 50% margin equals a 100% markup. This distinction matters when setting prices — confusing the two can mean selling below cost.
What's a good profit margin? It depends on industry. SaaS companies often run 60-80% gross margins. Retail sits around 25-50%. Restaurants average 3-9% net. Always compare against your industry, not a universal number.
Why is my markup higher than my margin? Markup uses cost as the base (smaller number), so the percentage is always larger. A $60 cost and $100 price = 40% margin but 66.7% markup.
Should I focus on gross or net margin? Gross margin shows product-level health. Net margin shows overall business health. Track both — a high gross margin with low net margin points to overhead problems.