💰 Profit Margin Calculator
📈 Single Product Analysis
🎯 Target Margin Calculator
📦 Batch Product Calculator
🏢 Industry Margin Benchmarks
🛒 Retail
Gross: 20-50%
Net: 2-5%
💻 Software
Gross: 70-90%
Net: 15-30%
🍽️ Restaurant
Gross: 60-70%
Net: 3-6%
🏭 Manufacturing
Gross: 20-35%
Net: 5-10%
📱 Electronics
Gross: 30-40%
Net: 3-8%
👗 Fashion
Gross: 50-60%
Net: 4-13%
💡 Profit Optimization Recommendations
📉 Reduce COGS
- Negotiate with suppliers
- Buy in bulk
- Optimize production
- Reduce waste
📈 Increase Revenue
- Value-based pricing
- Upsell & cross-sell
- Bundle products
- Premium offerings
⚡ Improve Efficiency
- Automate processes
- Reduce overhead
- Optimize inventory
- Streamline operations
❓ Frequently Asked Questions
What's the difference between gross and net profit margin?
Gross profit margin only considers the cost of goods sold (COGS), while net profit margin includes all operating expenses, taxes, and other costs. Gross margin shows product profitability, while net margin shows overall business profitability.
What's the difference between margin and markup?
Margin is profit as a percentage of the selling price, while markup is profit as a percentage of the cost. For example, a 50% margin equals a 100% markup.
What's a good profit margin for my business?
It varies by industry. Service businesses typically have higher margins (15-40%), while retail often has lower margins (2-10%). Compare with your industry benchmarks above.
How can I improve my profit margins?
Focus on three areas: reduce costs (negotiate with suppliers, improve efficiency), increase prices (value-based pricing, premium options), or change your product mix (focus on higher-margin items).
Should I focus on gross or net margin?
Both are important. Gross margin tells you if your core business model is profitable, while net margin shows if your overall business is sustainable after all expenses.
How do I calculate break-even point?
Break-even = Fixed Costs ÷ (Price per Unit - Variable Cost per Unit). This tells you how many units you need to sell to cover all costs.
What's the relationship between margin and volume?
Often there's a trade-off: lower margins can lead to higher volume, while higher margins might reduce volume. Finding the right balance maximizes total profit.
How do discounts affect profit margin?
Discounts directly reduce your margin. A 10% discount on a 30% margin product reduces your margin to about 22%. Calculate carefully before offering discounts.