# Margin Calculator > Free margin calculator: get profit margin, gross profit and markup from cost and price, or the price to charge for a target margin. Formulas shown. Canonical: https://brickbyclick.ai/margin-calculator Last updated: 2026-10-28 ## Profit margin calculator Start with what the job costs you, then tell it the price, the margin you want or the markup you use. Results update as you type. ### Result Price $2,000.00 Job cost $1,200.00 Gross profit $800.00 Margin 40.00% Markup 66.67% Price multiplier ×1.6667 Runs in your browser. Nothing you type is sent or saved. Money is rounded to the cent, percentages to two decimals. Want this on every job without retyping? [BrickByClick job costing](https://brickbyclick.ai/job-costing) shows what each job made after labour and materials, from the CRM in the [Starter plan, $99 a month](https://brickbyclick.ai/starter-plan). ## How to calculate profit margin Three numbers do all the work: the **price** (revenue), the **cost** and the **gross profit** between them. - Gross profit = price − cost - Margin % = gross profit ÷ price × 100 - Markup % = gross profit ÷ cost × 100 - Price = cost ÷ (1 − margin), with the margin as a decimal (40% = 0.40) - Price = cost × (1 + markup) ### Worked example A job takes 8 labour hours that cost you $45 each ($360) and $840 of materials. The job cost is **$1,200**. You quote **$2,000**. 1. Gross profit: 2,000 − 1,200 = **$800**. 2. Margin: 800 ÷ 2,000 = 0.40 = **40%**. 3. Markup: 800 ÷ 1,200 = 0.6667 = **66.67%**. Those are the numbers the calculator above opens with, so you can check it against your own maths. ## What is gross profit margin? Gross profit margin is the percentage of each sale you keep after paying the **direct** costs of doing that work. For a product business that is the cost of the goods. For a service business it is the cost of the job: the labour hours on site, materials, parts, equipment rental, subcontractors and dump fees. It leaves out **overhead**, the costs you pay whether or not you do the job: rent, insurance, vehicles, phones, software, marketing and office staff. Take those off too and you get **net profit margin**, which is always lower. *Gross vs net profit margin* | | Gross margin | Net margin | | --- | --- | --- | | Takes off | Direct job costs only | Direct job costs, overhead and usually tax | | Formula | (revenue − COGS) ÷ revenue | net profit ÷ revenue | | Use it to | Price jobs and compare one job with another | See whether the business as a whole makes money | ### Gross profit calculator for a month The same maths works on totals. Enter a month of labour and materials as the job cost and the month’s sales as the price, and the calculator gives your gross profit and gross margin for the month. ## Margin vs markup Margin and markup describe the same dollars of profit, measured against different numbers. Margin compares profit with the price. Markup compares it with the cost. Because the cost is smaller than the price, the markup is always the bigger percentage. The common pricing mistake You want a 40% margin, so you add 40% to the cost: $1,200 × 1.40 = $1,680. The profit is $480, and 480 ÷ 1,680 is a **28.57%** margin. To earn 40%, divide by 0.60 instead: $1,200 ÷ 0.60 = **$2,000**. - Margin = markup ÷ (1 + markup) - Markup = margin ÷ (1 − margin) Margin can never reach 100%, because profit cannot be bigger than the price. Markup has no ceiling: a 200% markup means the price is three times the cost (a 66.67% margin). ## Markup to margin conversion table Find the margin you want, then multiply your cost by the multiplier to get the price. The last column shows the price on a $1,000 job cost. *Margin, markup and price multiplier* | Margin | Markup | Multiply cost by | Price on $1,000 cost | | --- | --- | --- | --- | | 5% | 5.26% | ×1.0526 | $1,052.63 | | 10% | 11.11% | ×1.1111 | $1,111.11 | | 15% | 17.65% | ×1.1765 | $1,176.47 | | 20% | 25.00% | ×1.2500 | $1,250.00 | | 25% | 33.33% | ×1.3333 | $1,333.33 | | 30% | 42.86% | ×1.4286 | $1,428.57 | | 33⅓% | 50.00% | ×1.5000 | $1,500.00 | | 35% | 53.85% | ×1.5385 | $1,538.46 | | 40% | 66.67% | ×1.6667 | $1,666.67 | | 45% | 81.82% | ×1.8182 | $1,818.18 | | 50% | 100.00% | ×2.0000 | $2,000.00 | | 55% | 122.22% | ×2.2222 | $2,222.22 | | 60% | 150.00% | ×2.5000 | $2,500.00 | | 65% | 185.71% | ×2.8571 | $2,857.14 | | 70% | 233.33% | ×3.3333 | $3,333.33 | | 75% | 300.00% | ×4.0000 | $4,000.00 | ## How to price a job for the margin you want 1. **Add up the job cost.** Enter labour hours and what each hour costs you, then materials and any other direct costs. The total becomes the cost. 2. **Pick what you know.** Choose whether you know the price, the margin you want, or the markup you use. 3. **Enter the number.** Type the price, the target margin or the markup. 4. **Read the result.** The calculator shows the price, gross profit, margin and markup, and the formula with your numbers in it. 5. **Copy or print it.** Copy the result to paste into an estimate, or print it. ### Tips for service businesses - **Use what an hour costs you, not the wage.** Add payroll taxes, workers’ comp and benefits to the hourly wage. If you work on the job yourself, count your hours too. - **Count every direct cost.** Drive time, disposal, permits and small parts add up and quietly eat the margin. - **Pick the margin from your overhead.** If overhead takes 25 cents of every dollar you bill and you want 10 cents of net profit, you need about a 35% gross margin. - **Check afterwards.** Compare the margin you quoted with what the job really cost once it is done. That is how you learn which jobs pay. Once the price is set, put it on an estimate and then an invoice. The [free invoice generator](https://brickbyclick.ai/free-invoice-generator) makes a PDF in your browser, and [BrickByClick Free](https://brickbyclick.ai/free-invoicing) emails invoices with a pay link and takes card payments for $0 a month. Estimates, job tracking and [reports](https://brickbyclick.ai/business-reports) come with [Starter](https://brickbyclick.ai/starter-plan). ## Questions people ask ### How do I calculate profit margin? Take the price, subtract the cost, divide by the price and multiply by 100. A job you sell for $2,000 that costs you $1,200 has a gross profit of $800 and a margin of 800 ÷ 2,000 = 40%. ### What is gross profit margin? Gross profit margin is the share of each sale left after the direct cost of doing the work, such as labour on the job and materials. It is gross profit divided by revenue. It does not take off overhead like rent, insurance, the truck or your office, which is what net margin does. ### How do I calculate gross profit? Gross profit = revenue − cost of goods sold. For a service job, cost of goods sold is the direct cost of that job: the labour hours you pay for, materials, equipment rental and any subcontractor. ### What is the difference between margin and markup? Both use the same profit, but margin divides it by the price and markup divides it by the cost. A $1,200 job sold for $2,000 has an $800 profit: that is a 40% margin and a 66.67% markup. Margin can never reach 100%; markup can go above 100%. ### How do I set a price from a target margin? Divide the cost by (1 − the margin as a decimal). For a 40% margin on a $1,200 cost: 1,200 ÷ 0.60 = $2,000. Adding 40% to the cost instead gives $1,680, which is only a 28.57% margin. ### How do I convert markup to margin? Margin = markup ÷ (1 + markup). A 50% markup is 0.5 ÷ 1.5 = 33.33% margin. To go the other way, markup = margin ÷ (1 − margin), so a 25% margin is a 33.33% markup. ### What markup do I need for a 30% margin? A 42.86% markup. Multiply your cost by 1.4286 (or divide it by 0.70) to get the price. ### What is a good profit margin for a service business? There is no single right number: it depends on your trade, your area and your overhead. Work out what your overhead costs you each month, then set a gross margin high enough to cover it and leave the net profit you want. Compare your own jobs over time rather than a number from another industry. ### What is the difference between gross margin and net margin? Gross margin takes off only the direct costs of the work. Net margin also takes off overhead, such as rent, insurance, vehicles, phones, software and office wages, and usually tax. Net margin is always lower than gross margin. ### Should I include my own wages in the job cost? If you work on the job, yes. Count your hours at the rate you would pay someone else to do them. Otherwise the margin looks better than it is, and the business cannot afford to replace you on the tools. ### Can a profit margin be negative or over 100%? It can be negative: that means the job cost more than you charged. It cannot reach 100% unless the cost is zero, because the profit can never be bigger than the price. Markup has no upper limit. ### Does sales tax change my margin? Work out margin on the price before tax. Sales tax is collected for the government and is not your revenue, so leave it out of both the price and the cost. ## Related - [Free invoice generator](https://brickbyclick.ai/free-invoice-generator): Make an invoice and save it as a PDF. - [Receipt maker](https://brickbyclick.ai/receipt-maker): Make a payment receipt and print or save it. - [Proforma invoice template](https://brickbyclick.ai/proforma-invoice-template): What a proforma invoice is, with a template. - [Google Docs invoice template](https://brickbyclick.ai/google-docs-invoice-template): A template that opens in Google Docs. - [Word invoice template](https://brickbyclick.ai/word-invoice-template): A Microsoft Word invoice to download. - [Roofing calculator](https://brickbyclick.ai/roofing-calculator): Roof area, squares and bundles from pitch. - [Square footage calculator](https://brickbyclick.ai/square-footage-calculator): Area of shapes, square feet and acres. - [HVAC duct calculator](https://brickbyclick.ai/hvac-duct-calculator): Estimate duct size from CFM and velocity. - [Pipe volume calculator](https://brickbyclick.ai/pipe-volume-calculator): Gallons and litres in a length of pipe. - [How to leave a Google review](https://brickbyclick.ai/how-to-leave-a-google-review): Steps for customers, plus a review link builder. - [Google Local Services Ads](https://brickbyclick.ai/google-local-services-ads): How LSA and pay-per-lead work.