Profit Margin Calculator Notes

  • Profit Margin vs Markup

    Profit Margin = (Profit / Selling Price) × 100

    Markup = (Profit / Cost) × 100

    A 50% margin means you keep 50p of every pound after costs. A 50% markup means you add 50p to every pound of cost.

  • Why It Matters

    • Retail: Typical margins 20-50%
    • Restaurants: Often 3-9% net margin
    • Services: Can be 30-50% or higher
    • Wholesale: Usually 2-15%

  • Important Notes

    Gross profit margin is different from net profit margin, which accounts for all expenses including overhead, taxes, and interest.