Profit Margin Calculator: Margin, Markup and Break-Even
What you pay, excluding any GST you can claim back
- Cost 60%
- Profit 40%
- Gross profitPrice − costS$40.00
- Gross marginProfit ÷ price40.0%
- MarkupProfit ÷ cost66.7%
Profit on 100 sold
S$4,000
Cost as % of price
60.0%
Price for a 50% margin
S$120.00
Gross margin
40.0%
- Gross profit per item
- S$40.00
- Markup on cost
- 66.7%
How this works
Gross margin is profit as a share of the selling price: (price − cost) ÷ price. Markup is profit as a share of cost: (price − cost) ÷ cost. The same sale always has a higher markup than margin: an item costing S$60 and selling for S$100 has a 40% margin and a 66.7% markup.
To price for a target margin, divide cost by (1 − margin): a 40% margin on a S$60 cost needs a S$100 price. To convert, markup = margin ÷ (1 − margin) and margin = markup ÷ (1 + markup).
If you are GST-registered, the GST you charge belongs to IRAS, so margins are worked out on the price before GST. With the GST option on, the calculator divides a GST-inclusive price by 1.09 (the 9% standard rate since 1 January 2024) before computing, and adds 9% back when suggesting a shelf price.
Break-even units are fixed costs ÷ (price − variable cost per unit), rounded up to the next whole unit.
FAQs
What is the difference between margin and markup?
Margin divides profit by the selling price; markup divides it by cost. Selling a S$60 item for S$100 is a 40% margin but a 66.7% markup.
How do I calculate selling price from cost and margin?
Selling price = cost ÷ (1 − margin). For a 30% margin on a S$70 cost, the price is S$70 ÷ 0.7 = S$100 before GST, or S$109 including 9% GST.
Should I calculate profit margin before or after GST?
Before GST, if you are GST-registered. On a S$109 GST-inclusive price, S$9 is GST owed to IRAS, so your revenue is S$100. Sellers who are not GST-registered do not charge GST, so their whole price is revenue.
What markup gives a 50% margin?
A 100% markup gives a 50% margin: doubling the cost means half the price is profit. A 25% margin needs a 33.3% markup and a 20% margin needs a 25% markup.
How do I work out my break-even point?
Divide monthly fixed costs by the contribution per unit (price minus variable cost). With S$8,000 fixed costs, a S$25 price and a S$10 unit cost, you break even at 534 units a month.