Finance

Instant, private, and free

Gross Margin Calculator.

Calculate gross margin percentage from revenue and COGS.

On-device calculationNo signup

Set your values

Results update as you type.

02 / ANSWER

Revenue

Cost of goods sold

Gross margin

0.00%

FAQs

How does the gross margin calculator work?

Enter the requested values to see a deterministic result. Assumptions are explicit and no live market or tax data is fetched.

Use Cases

Pricing Strategy

Determine if your selling price covers costs and yields a desired profit margin. Adjust pricing or negotiate supplier costs to improve profitability.

Example: If your product costs $50 to make and you want a 40% margin, set the price at $83.33.

Business Health Check

Assess the financial health of your business by tracking gross margin over time. A declining margin may indicate rising costs or pricing pressure.

Example: Compare quarterly margins to spot trends and make informed decisions.

Frequently Asked Questions

What is gross margin?: Gross margin is the percentage of revenue that exceeds the cost of goods sold (COGS). It shows how efficiently a company uses its resources to produce goods. The formula is: (Revenue - COGS) / Revenue * 100.
How do I calculate gross profit?: Gross profit is simply revenue minus cost of goods sold (COGS). For example, if revenue is $100,000 and COGS is $60,000, gross profit is $40,000.
What is a good gross margin?: A good gross margin varies by industry. Generally, higher is better, but typical ranges are 20-30% for retail, 50-60% for software, and 30-40% for manufacturing. Compare your margin to industry benchmarks.

Tips & Common Mistakes

Tips

Ensure you include all direct costs in COGS, such as materials, labor, and manufacturing overhead.
Use consistent accounting periods (monthly, quarterly) for accurate comparisons.
Regularly review your pricing and costs to maintain a healthy margin.
Use gross margin to set sales targets and evaluate product profitability.

Common Mistakes to Avoid

Forgetting to include all direct costs in COGS, leading to an inflated margin.
Confusing gross margin with net margin, which includes operating expenses and taxes.
Using revenue before discounts or returns, which overstates the actual margin.

Last updated: August 13, 2026

Use Cases

Pricing Strategy

Determine if your selling price covers costs and yields a desired profit margin. Adjust pricing or negotiate supplier costs to improve profitability.

Example: If your product costs $50 to make and you want a 40% margin, set the price at $83.33.

Business Health Check

Assess the financial health of your business by tracking gross margin over time. A declining margin may indicate rising costs or pricing pressure.

Example: Compare quarterly margins to spot trends and make informed decisions.

Frequently Asked Questions

What is gross margin?

Gross margin is the percentage of revenue that exceeds the cost of goods sold (COGS). It shows how efficiently a company uses its resources to produce goods. The formula is: (Revenue - COGS) / Revenue * 100.

How do I calculate gross profit?

Gross profit is simply revenue minus cost of goods sold (COGS). For example, if revenue is $100,000 and COGS is $60,000, gross profit is $40,000.

What is a good gross margin?

A good gross margin varies by industry. Generally, higher is better, but typical ranges are 20-30% for retail, 50-60% for software, and 30-40% for manufacturing. Compare your margin to industry benchmarks.

Tips & Common Mistakes

Tips

Ensure you include all direct costs in COGS, such as materials, labor, and manufacturing overhead.
Use consistent accounting periods (monthly, quarterly) for accurate comparisons.
Regularly review your pricing and costs to maintain a healthy margin.
Use gross margin to set sales targets and evaluate product profitability.

Common Mistakes to Avoid

Forgetting to include all direct costs in COGS, leading to an inflated margin.
Confusing gross margin with net margin, which includes operating expenses and taxes.
Using revenue before discounts or returns, which overstates the actual margin.

Finance

Instant, private, and free

Gross Margin Calculator.

Calculate gross margin percentage from revenue and COGS.

On-device calculationNo signup

Set your values

Results update as you type.

02 / ANSWER

Revenue

Cost of goods sold

Gross margin

0.00%

FAQs

How does the gross margin calculator work?

Enter the requested values to see a deterministic result. Assumptions are explicit and no live market or tax data is fetched.

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Use Cases

Pricing Strategy

Determine if your selling price covers costs and yields a desired profit margin. Adjust pricing or negotiate supplier costs to improve profitability.

Example: If your product costs $50 to make and you want a 40% margin, set the price at $83.33.

Business Health Check

Assess the financial health of your business by tracking gross margin over time. A declining margin may indicate rising costs or pricing pressure.

Example: Compare quarterly margins to spot trends and make informed decisions.

Frequently Asked Questions

What is gross margin?: Gross margin is the percentage of revenue that exceeds the cost of goods sold (COGS). It shows how efficiently a company uses its resources to produce goods. The formula is: (Revenue - COGS) / Revenue * 100.
How do I calculate gross profit?: Gross profit is simply revenue minus cost of goods sold (COGS). For example, if revenue is $100,000 and COGS is $60,000, gross profit is $40,000.
What is a good gross margin?: A good gross margin varies by industry. Generally, higher is better, but typical ranges are 20-30% for retail, 50-60% for software, and 30-40% for manufacturing. Compare your margin to industry benchmarks.

Tips & Common Mistakes

Tips

Ensure you include all direct costs in COGS, such as materials, labor, and manufacturing overhead.
Use consistent accounting periods (monthly, quarterly) for accurate comparisons.
Regularly review your pricing and costs to maintain a healthy margin.
Use gross margin to set sales targets and evaluate product profitability.

Common Mistakes to Avoid

Forgetting to include all direct costs in COGS, leading to an inflated margin.
Confusing gross margin with net margin, which includes operating expenses and taxes.
Using revenue before discounts or returns, which overstates the actual margin.

Last updated: August 13, 2026