📊 Gross Margin Calculator
Quickly calculate your gross margin percentage and make better pricing decisions.
🧮 Calculate Gross Margin
Enter your revenue and cost of goods sold (COGS) to get instant results
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Gross Profit
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Gross Margin
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💡 Frequently Asked Questions
Everything you need to know about Gross Margin
What is Gross Margin?+
Gross margin shows how much profit you make after deducting the cost of goods sold from your revenue.
Why is Gross Margin important?+
It helps you measure profitability and pricing efficiency, which are crucial for sustainable growth.
What is a healthy Gross Margin?+
It varies by industry, but generally 40–60% is considered strong for most businesses.
Difference between Gross Margin and Net Margin?+
Gross margin only considers COGS, while net margin accounts for all expenses including taxes and overhead.
Can Gross Margin be negative?+
Yes. If your COGS exceed your revenue, your gross margin will be negative – a red flag for any business.
How do I improve my Gross Margin?+
You can increase prices, reduce production costs, negotiate supplier discounts, or optimize operations.
What industries have high Gross Margins?+
SaaS, digital products, and luxury goods often have very high gross margins (70–90%).
Is Gross Margin same as Markup?+
No. Markup is based on cost, while gross margin is based on revenue. Margin = Profit ÷ Revenue.
Can I use Gross Margin for pricing?+
Yes. Decide your desired gross margin and set prices to achieve that target profit.
How often should I track my Gross Margin?+
Monthly tracking is recommended for most businesses. High-volume businesses may track weekly.