Your result
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Enter your values, then click Calculate result.How this calculator helps
Understand whether a product or job is priced sustainably. Enter sales revenue and all direct costs to compare gross profit margin with markup—two related percentages that are often confused.
How to use it
- 1
Enter net sales revenue after customer discounts and refunds.
- 2
Enter all direct costs attributable to those sales.
- 3
Compare margin with markup and add operating expenses before judging overall profitability.
Formula and methodology
Profit = revenue − cost. Margin = profit ÷ revenue × 100. Markup = profit ÷ cost × 100.
Calculates revenue, cost and profit from the commercial assumptions entered. Reconcile results with current platform, courier, payment and tax statements.
Worked calculation example
If an item sells for PKR 2,000 and costs PKR 1,400, gross profit is PKR 600, margin is 30%, and markup on cost is about 42.9%.
How to interpret your result
Use margin to judge profit as a share of selling price and markup to judge profit relative to cost; they are not interchangeable.
Input guide
Revenue should exclude refunded or cancelled sales.
Direct cost should include the costs required to deliver the item.
Allocate overhead separately when deciding whether net profit is acceptable.
Scenario comparison
| Scenario | What it demonstrates |
|---|---|
| Cost 1,400 and revenue 2,000 | produces 30% margin but about 42.9% markup. |
| 10% cost increase | reveals how margin compresses if price stays fixed. |
| Discounted sale | retest revenue after promotion rather than using list price. |
Common mistakes to avoid
- Calling markup and margin the same percentage.
- Leaving delivery or marketplace charges out of cost.
- Using revenue before returns while using cost after returns.
Reconcile inputs with invoices and the same accounting period before changing prices.
What can affect the result?
Direct costs
Product, packaging, transaction and fulfilment costs may all belong in cost of sales.
Returns
Refunds and damaged inventory reduce realised margin.
Overheads
Gross margin does not include salaries, rent, software, tax or financing.
Limits of this estimate
The result is a gross unit or period comparison and is not a complete profit-and-loss statement or tax calculation.
Sources and review information
Frequently asked questions
Is the profit margin calculator free?＋
Yes. SolvePilot tools are free, work in your browser, and require no account.
Does SolvePilot store my values?＋
No. Calculations run locally in your browser and the values you enter are not sent to a server.
Should I treat the result as an exact bill or quotation?＋
No. Results are informed estimates. Final charges can vary because of taxes, tariffs, lender terms, usage patterns, or provider rules.
How can I improve the accuracy?＋
Use recent values from your own bill, statement or institution, review every assumption, and confirm important results with the relevant official source.
Is margin the same as markup?＋
No. Margin divides profit by selling price, while markup divides profit by cost, so the percentages differ.