Profit Margin Calculator
Enter your cost and selling price to instantly see gross margin, markup, and profit per unit, plus total profit across however many units you sell.
Your product
Profit margin
60.0%
Profit as a % of your selling price
Markup
150.0%
Profit as a % of your cost
Profit per unit
€60
Selling price minus cost
Total profit
€6,000
Across all units sold
Total revenue
€10,000
Across all units sold
What this means: A healthy margin, right in the typical e-commerce range of 40-60%.
How to calculate profit margin
Profit margin tells you how much of every euro of revenue you actually keep. The formula is simple: subtract the unit cost from the selling price to get your gross profit, then divide by the selling price and multiply by 100. A product that costs €40 and sells for €100 earns €60 of gross profit, a 60% margin.
Margin and markup are easy to confuse because they use the same profit figure with a different denominator. Margin divides profit by the selling price; markup divides it by the cost. That same €40-to-€100 product has a 60% margin but a 150% markup. Marketplaces, accountants and pricing tools almost always mean margin, so that's the number to lead with.
Gross margin ignores the costs that quietly eat your profit: shipping, payment fees, returns and storage. A 50% gross margin can become a 10% net margin once a product gets returned often or sits in a warehouse. That's why the margin on a single product only tells part of the story.
Calculating margin one product at a time works when you have ten SKUs. With hundreds or thousands, you need it computed automatically, and kept current as costs and prices change. That's exactly what WISEPIM's profitability analytics does across your entire catalog.
You found the margin on one product.
WISEPIM calculates true margin for every product in your catalog, factoring in cost, returns and channel fees, and surfaces the items quietly losing you money. No spreadsheets.
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Frequently asked questions
What's the difference between margin and markup?
Margin is profit as a percentage of the selling price; markup is profit as a percentage of the cost. A €40 item sold for €100 has a 60% margin but a 150% markup, same money, different denominator. Pricing tools and marketplaces usually mean margin.
How do I calculate profit margin?
Profit margin = (selling price − cost) ÷ selling price × 100. Subtract what the product costs you from what you sell it for, divide by the selling price, and multiply by 100 to get a percentage.
What is a good profit margin for e-commerce?
It varies by category, but many online retailers target a gross margin of 40-60%. Lower-margin categories (electronics) often run 10-25%, while private-label and beauty can exceed 70%. Compare against your category and factor in returns and ad spend.
Does this include taxes, shipping or fees?
No, this is gross margin based on unit cost and selling price. For net margin, add shipping, payment fees, returns and overhead to your cost. WISEPIM tracks true per-product profitability across your whole catalog once your order data is connected.
How do I work out the selling price for a target margin?
Divide your cost by (1 minus the target margin as a decimal). For a 50% margin on a €40 item: €40 ÷ (1 − 0.50) = €80. For 60%: €40 ÷ 0.40 = €100. This is the cleaner way to price, set the margin you need and let the price follow, instead of guessing a markup.
Why is my margin lower than my markup?
Margin is always lower than markup because they use different denominators. Markup divides profit by the smaller number (cost), while margin divides the same profit by the larger number (price). A 100% markup is only a 50% margin. The two only match at 0%, so never quote one as if it were the other.