Free profit margin and markup calculator for traders, retailers, and freelancers worldwide. Enter cost and selling price to compute the gross profit, the profit margin percentage and the markup percentage.
Profit margin is the single most important number in any business. It tells you how much of every riyal, dirham or pound of revenue actually stays in your pocket after the cost of producing the sale. The Xuvilo profit margin calculator gives you that number in one click, plus the gross profit and the equivalent markup, so you can price confidently, negotiate firmly, and spot loss-leaders before they hurt your cash flow.
The calculator is built for the realities of MENA trading. It takes plain numbers, so it works in whatever currency you price in, and it switches between Arabic and English with one toggle. It shows the markup beside the margin, so the two can never be confused when you then price a quotation or an invoice.
Use it whenever you set a price. Importers run it before they finalise a shipping container's landed cost. Freelancers run it before they quote a project. Ecommerce sellers run it on every new SKU. Restaurant owners run it on every menu item. The five-second habit of checking margin before quoting is what separates businesses that grow from businesses that stall.
Profit = Selling Price − Cost Price
Profit Margin = (Profit ÷ Selling Price) × 100
Markup = (Profit ÷ Cost Price) × 100
Cost price $80, selling price $100 → profit $20 → margin 20% → markup 25%
Both start from the same profit. Margin divides it by the selling price; markup divides it by the cost. So for a profitable sale the markup is always the larger figure: a 25% markup is a 20% margin, and a 100% markup is only a 50% margin. Margin can never reach 100%, which would need a cost of zero, while markup can go far above it. Confusing the two is one of the most common pricing mistakes, which is why the calculator shows both.
Gross profit margin = (revenue − cost of goods sold) ÷ revenue × 100. For example, revenue of $10,000 with cost of goods sold of $6,000 gives a gross profit of $4,000 and a gross margin of 40%.
It depends on the sector, and on whether you mean gross or net margin. Net margins in retail and food service are usually thin — low single digits up to around 10% — while software and professional services can reach 20% or more. Gross margins run higher, because they subtract only the direct cost of what was sold, not rent, other overheads or tax. The margin this calculator shows depends on the cost you enter: the direct cost gives a gross margin, and a cost that includes a share of overheads, as it should for a service, comes closer to the net margin. Compare yourself with businesses in your own sector rather than with a universal figure.
The landed cost: the purchase price plus shipping, customs duty, clearance and handling. Using the purchase price alone overstates the margin and leads to underpricing. If the costs arrive in different currencies — freight quoted in USD, duty paid in AED — convert them into one currency first, then enter the total as the cost price. The Import Cost calculator adds these up for you.
Yes. For a service, the cost price is the fully loaded cost of the hours involved — salary, benefits, software and a share of overheads — and the selling price is what you charge for the job. The margin then shows whether a fixed-price job is worth taking at that price.
Three levers: raise the price, lower the cost, or sell more so that fixed costs are spread over more units, which improves the net margin. Price acts most directly: on an item costing $80, raising the price from $100 to $105 lifts the margin from 20% to 23.8%.
Gross margin (revenue minus direct costs) shows production and pricing efficiency. Net margin (revenue minus all costs including overheads and tax) shows overall business profitability. Use gross margin to evaluate product lines; net margin to assess the whole business.
Profit margin measures profitability relative to revenue. Return on Investment (ROI) measures return relative to capital invested. A business can have a high margin but low ROI if it requires heavy capital to generate that revenue (e.g. heavy manufacturing).
The middle of the three margins: operating profit, which is gross profit minus running costs such as rent, salaries and marketing, before interest and tax, divided by revenue. Gross margin tells you whether your pricing works; operating margin tells you whether your running costs are under control. Net profit then takes off interest, tax and any other expenses.
A shop sells SAR 500,000 in a month, and the goods cost SAR 350,000: gross profit is SAR 150,000, a 30% gross margin. Rent, salaries and marketing come to SAR 100,000, leaving operating profit of SAR 50,000, a 10% operating margin. After SAR 10,000 of interest and tax, net profit is SAR 40,000, an 8% net margin. Here each point of gross margin is worth SAR 5,000 a month.
Negotiate better prices or payment terms with your suppliers, buy from fewer suppliers in larger volumes, cut waste, spoilage and stock losses, and stop selling the products or services that earn least once their costs are counted.
No, on either side. Use the selling price before VAT and the cost before any input VAT you can reclaim: the VAT you collect belongs to the tax authority, and VAT you can reclaim is not a cost.
A negative gross margin means you sell each unit below its cost, so selling more makes it worse: fix the price or the cost first. A positive gross margin with a negative net margin means each sale covers its direct cost, but your running costs are too high for your sales.
Gross margin whenever your prices or costs change, which for many traders means weekly, and net margin every month, with your accountant if you have one.
Once you have settled on a margin, send the quote with the free Xuvilo quotation generator or invoice the customer with the free invoice generator. For how to turn a margin into a price clients accept, read our guide to pricing your services. More articles live in the Xuvilo Blog.
Open the free Profit Margin Calculator for Traders now, or browse the full business calculator suite.
