What is your profit margin really telling you?
Type your revenue and your costs. We show your margin, what each point of it is worth in dollars, and the one cost to look at first.
Your numbers
Check the math
You just did this with numbers from memory. Finalysis runs it on your actual books, every day, and tells you when it moves.
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How the math works
Your profit margin is what is left after costs, divided by revenue. If you bring in $100 and spend $80, you keep $20, and your margin is 20 percent. Each point of margin is worth one percent of your revenue in profit, so at $20 million of revenue, one point of margin is $200,000 a year.
Common questions
How do I calculate my profit margin?
Take your revenue, subtract all your costs, then divide the result by your revenue. Multiply by 100 to get a percent. A business with $2,000,000 in revenue and $1,700,000 in costs keeps $300,000, which is a 15 percent margin.
What is a good profit margin?
It depends on your industry. A grocery store can be healthy on a thin margin while a software company expects a fat one. Compare yourself against businesses like yours, not against a universal number. The calculator lets you set your own healthy line for exactly this reason.
What is the difference between margin and markup?
Margin is profit as a share of your selling price. Markup is profit as a share of your cost. A product bought for $50 and sold for $100 has a 50 percent margin but a 100 percent markup. Same dollars, two different yardsticks.
Built by Finalysis, the financial intelligence platform for owner operators.
This is a planning shape, not a forecast. It uses the numbers you type, nothing more. Margin health varies by industry, so the thresholds here are general operator rules of thumb, and you can move them under Check the math. Nothing you enter leaves your device.