Calculate gross profit margin from revenue and cost of goods sold. Shows margin %, gross profit, and cost ratio. Fully client-side — no account needed.
Added May 6, 2026
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Enter a value for revenue (total sales) to see your result.
Calculates gross profit margin as a percentage of revenue. Shows how much of each dollar of revenue remains after subtracting the direct costs of production or goods sold.
Gross Margin % = (Revenue − COGS) / Revenue × 100
Selling $50,000 worth of goods that cost $30,000 to produce gives a 40% gross margin.
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Software businesses often achieve 70%+ gross margins because marginal cost per unit is low.
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It depends heavily on the industry. Retail businesses typically have 2–10% net margins. Software (SaaS) companies often reach 60–80% gross margins. Manufacturing falls around 30–40%. Compare to industry benchmarks rather than a universal target.
Gross margin subtracts only the direct costs of producing goods (COGS). Net margin also subtracts operating expenses, interest, and taxes. Net margin is a more complete picture of profitability but requires more inputs.
COGS (Cost of Goods Sold) includes only the direct costs tied to producing what you sell — materials, manufacturing labour, and direct overhead. It excludes indirect costs like sales, marketing, and administration.
Margin is profit as a percentage of the selling price. Markup is profit as a percentage of the cost. A 50% markup on a $10 item gives a $15 price and a 33% margin. Always clarify which your industry uses.