Calculate your profit margin, revenue, costs, and profit to better understand the profitability of your business.
Profit margin measures how much of your revenue remains as profit after covering your business costs. It is expressed as a percentage and is one of the most important metrics for evaluating business profitability.
Whether you run an online store, service business, startup, or retail company, understanding your profit margin helps you price products correctly, control costs, and make better financial decisions.
Profit Margin = ((Revenue − Costs) ÷ Revenue) × 100
First calculate your profit by subtracting your total costs from your revenue. Then divide that profit by your revenue and multiply by 100 to get your profit margin percentage.
Revenue: $1,000
Total Costs: $700
Profit: $300
Profit Margin: 30%
In this example, the business keeps 30 cents of profit for every $1.00 of revenue, resulting in a profit margin of 30%.
Profit margin is the percentage of your revenue that remains as profit after subtracting your business costs. It shows how efficiently your business generates profit from sales.
A good profit margin depends on your industry. Some businesses operate successfully with margins below 10%, while others may achieve margins of 30% or more.
Yes. If your costs are higher than your revenue, your business is operating at a loss and your profit margin will be negative.
Profit is the dollar amount you earn after expenses, while profit margin expresses that profit as a percentage of your total revenue, making it easier to compare performance over time.
Yes. This calculator works for online stores, retail businesses, service companies, freelancers, startups, restaurants, and virtually any business that generates revenue.
Continue learning with practical guides, calculators, and resources designed to help you improve your profitability and make smarter financial decisions.
Learn how to calculate profit margin step by step and discover why it's one of the most important business metrics.
Read Guide → ArticleUnderstand the differences between gross profit margin and net profit margin and when to use each.
Read Article → LibraryExplore our growing collection of free business calculators, financial tools, and generators.
View Tools →