Profit Margin Calculator
Calculate gross, net, and operating profit margins for your business
Total sales revenue
Direct costs to produce goods/services
Rent, salaries, marketing, etc.
Improve Your Margins
Reduce COGS
Negotiate better supplier rates, improve efficiency
Optimize Pricing
Test price increases, add premium options
Cut Operating Costs
Automate processes, reduce overhead
Understanding Profit Margins
Profit margins are essential metrics that show how much profit your business generates from its revenue. They help you understand your business's financial health, compare performance against competitors, and make informed pricing and cost decisions.
Types of Profit Margins
- Gross Profit Margin: Shows profitability after direct costs
- Operating Profit Margin: Includes operating expenses
- Net Profit Margin: The bottom line after all expenses
How to Improve Profit Margins
Improving profit margins requires a strategic approach focusing on increasing revenue, reducing costs, or both. Consider optimizing pricing, negotiating better supplier terms, improving operational efficiency, and focusing on higher-margin products or services.