How to use the Profit Margin Calculator
- Choose what you know: selling price, target margin or target markup.
- Enter the cost price and the second value.
- Optionally add the GST rate to see the final price for the customer.
About this tool
Profit = selling price − cost. Margin = profit ÷ selling price × 100 — the share of the sale you keep. Markup = profit ÷ cost × 100 — how much you add on top of cost. Buying at ₹800 and selling at ₹1,000 is a 25% markup but a 20% margin. To hit a target margin, selling price = cost ÷ (1 − margin); for a target markup, selling price = cost × (1 + markup).
If you are GST-registered, GST is charged on top of your selling price and passed on to the government, so margins should be worked out on the price before GST. A ₹1,000 product with 18% GST is billed at ₹1,180. Remember to include shipping, platform fees and returns in your cost when pricing for marketplaces.
Frequently asked questions
What is 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. The same ₹200 profit on an ₹800 cost is a 20% margin and a 25% markup.
How do I price for a 30% margin?
Divide the cost by 0.70. An ₹800 cost needs a ₹1,142.86 selling price (before GST).
Should GST be included in profit margin?
No. GST you collect belongs to the government (after input credit), so calculate margin on the price before GST.