Products & E-commerce
Enter sales revenue and stock or fulfilment costs to see the gross margin on every line you sell.
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Free Margin Calculator for UK Businesses
A business margin calculator built for UK pricing decisions. Enter revenue and costs to instantly calculate gross margin, net profit, margin percentage, and markup — no sign-up needed.
Your Numbers
All money coming in
Direct costs to deliver
Rent, tools, ads, fees
For profit per unit
Net Profit
£0.00
Revenue minus all costs and expenses.
- Gross Profit
- £0.00
- Total Costs
- £0.00
- Profit Margin
- 0.0%
- Markup
- 0.0%
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Gross margin calculator
How This Margin Calculator Works for UK Businesses
Whether you price products, services, or retainers, this gross margin calculator turns two numbers — revenue and direct costs — into the margin percentage that drives your pricing, quoting, and growth decisions.
Services & Agencies
Use project fees as revenue and delivery labour as cost to check each engagement's margin before you quote.
Trades & Local Business
Add materials as direct costs and overheads as expenses to see both gross and net margin on a job.
Figures are shown in pounds sterling (£) unless your account is set to another country. The margin percentages are currency-agnostic, so the same results apply if you work in dollars or euros.
Profit formulas explained
Profit Margin Formula: A Simple Guide
Profit margins show how much of your revenue remains after costs. Use gross profit margin to assess direct trading performance and net profit margin to understand profitability after operating expenses.
Gross Profit Formula
Gross Profit = Revenue − Cost of Goods Sold
Gross profit is the amount left after subtracting the direct cost of producing or delivering what you sell.
Gross Profit Margin Formula
Gross Profit Margin = (Gross Profit ÷ Revenue) × 100
This converts gross profit into a percentage of revenue, making performance easier to compare across periods.
Net Profit Formula
Net Profit = Revenue − Direct Costs − Operating Expenses
Net profit includes overheads such as rent, software, advertising, professional fees, and other operating expenses.
Net Profit Margin Formula
Net Profit Margin = (Net Profit ÷ Revenue) × 100
The Profit Margin result above uses this formula to show the percentage of revenue retained after all entered costs.
How to Calculate Gross Profit Margin: Example
If a business earns £100,000 in revenue and its cost of goods sold is £60,000, gross profit is £40,000. Divide £40,000 by £100,000 and multiply by 100. The gross profit margin is 40%.
- 1. Find gross profit: £100,000 − £60,000 = £40,000
- 2. Divide by revenue: £40,000 ÷ £100,000 = 0.40
- 3. Convert to a percentage: 0.40 × 100 = 40%
Profit Margin vs Markup
Margin measures profit against revenue, while markup measures profit against cost. They are not interchangeable. A product costing £60 and selling for £100 has a 40% margin but a 66.7% markup.
Markup = (Profit ÷ Total Cost) × 100
Common Margin Calculator Questions
How do I calculate margin for my business?
Enter your revenue and cost of goods sold above. The calculator returns gross profit, gross margin percentage, and markup instantly. Add operating expenses to see your net profit margin as well.
What counts as cost of goods sold?
Include direct costs needed to make or deliver a sale, such as materials, production labour, stock, packaging, or direct service-delivery costs.
What is a good profit margin?
A healthy margin varies by industry, business model, and stage of growth. Compare your result with your own previous periods and relevant industry benchmarks.
Can profit margin be negative?
Yes. A negative margin means the entered costs exceed revenue. Review pricing, direct costs, and operating expenses to identify the cause.
Should I use gross or net profit margin?
Use gross margin to assess sales and direct costs. Use net margin to measure the overall profitability left after operating expenses.
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