Product Margin Calculator
Calculate gross profit and margin on a single product from its price and landed cost.
About Product Margin Calculator
Margin divides profit by revenue; markup divides the same profit by cost. They are routinely confused, so both are shown — a 50% margin is a 100% markup. Margin is what funds every fixed cost in a product business, and mispricing by a few points is the difference between scaling profitably and scaling losses.
Formula
Product Margin
Margin % = (Selling price − Landed unit cost) ÷ Selling price × 100
- Selling price
- Money received
- Landed unit cost
- Direct cost of delivering it
Worked example
With the default values below, Product Margin Calculator returns Product Margin of 56.67%. Change any input above and every figure here is recalculated in your browser.
Inputs used
- Selling priceminimum 0
- 60
- Landed unit costminimum 0
- 26
Results
- Product Margin
- 56.67%
- Profit
- $34.00
- Markup on Cost
- 130.77%
- Cost as Share of Revenue
- 43.33%
Step by step
- 1Values used
- 2Product Margin
- 3Product Margin= 56.67
- 4Profit= 34.00
- 5Markup on Cost= 130.77
- 6Cost as Share of Revenue= 43.33
Assumptions and limits
- The result is derived only from the 2 inputs listed above. Anything not among them is not part of the calculation.
- In particular, this calculator does not take inflation, tax or compounding frequency into account.
- Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
- This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.
How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.
Frequently Asked Questions
How is Product Margin calculated?
Margin % = (Selling price − Landed unit cost) ÷ Selling price × 100 Margin divides profit by revenue; markup divides the same profit by cost. They are routinely confused, so both are shown — a 50% margin is a 100% markup.
Why does Product Margin matter?
Margin is what funds every fixed cost in a product business, and mispricing by a few points is the difference between scaling profitably and scaling losses.
What values do I need to enter?
This calculator takes 2 inputs: Selling price, Landed unit cost. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.