Free Margin Calculator
Calculate gross profit margins from known costs and selling prices, or reverse-calculate the exact price needed to hit your target business margin.
Profit Margin Calculator
Calculate Gross Margin % or Target Selling PriceFormula: Margin % = (Price - Cost) / Price × 100. Unlike markup, profit margin can never reach 100% unless your cost is $0.
Profit & Margin Results
% of revenue kept as profit
Ready to bill this item?
Transfer the final calculated selling price directly into Invoza's invoice generator (cost basis and margin targets remain private).
Revenue Share Perspective
Margin answers: "Out of every $1.00 invoiced, how many cents remain as gross profit after paying direct costs?"
Reverse Target Pricing
Rather than guessing prices, set your required business margin (e.g. 45%) and let the formula compute the minimum invoice price you must charge.
Markup Comparison
Never confuse the two: a 50% markup yields a 33.3% margin. If you quote a client with 50% markup thinking you made 50% margin, your books will fall short.
Related Pricing Tools
Frequently Asked Questions
How do you calculate gross profit margin?
Gross profit margin is calculated with the formula: Gross Margin % = ((Selling Price - Cost) / Selling Price) × 100. For example, if you sell a service for $200 that cost $120 to deliver, your gross profit is $80, and your profit margin is 40% ($80 / $200).
How do you calculate selling price from a target margin?
To find the required selling price for a target margin: Selling Price = Cost / (1 - Target Margin / 100). For example, to achieve a 30% margin on a $70 cost: $70 / (1 - 0.30) = $100 selling price.
Can profit margin ever exceed 100%?
No. In standard accounting, gross profit margin can never reach or exceed 100% because profit is a fraction of the selling price. If your cost is zero, your margin is 100%. Markup, by contrast, can easily exceed 100%, 200%, or more.
What is a healthy profit margin for professional services?
For solo freelancers and consultants, target gross margins typically range from 60% to 80% (since direct cost is primarily software and direct labor). For agencies and technical contractors with employee overhead, healthy gross margins generally range between 40% and 55%.