Pricing
Price for the margin you want.
Enter your cost and the gross margin you want. Get the price that delivers it, and see how far off the common shortcut lands.
Selling price = cost / (1 - target margin). A $60 cost and a 40% target margin gives $60 / 0.60 = $100.00. Using $60 x 1.40 = $84.00 would give only a 28.57% margin.
Your numbers
Result
Worked example
Your cost is $60 and you want a 40% gross margin. Price = 60 / (1 - 0.40) = $100.00. Profit is $40.00, which is 40% of the $100 price, and the markup on cost is 66.67%. The shortcut cost x 1.40 gives $84.00, a margin of only 28.57%, so 11.43 points short of target.
How it works
Margin is a share of the price, so the price is the unknown you divide into. Profit = margin x price and price = cost + profit, so price = cost + margin x price, which rearranges to price = cost / (1 - margin). The tool rejects a 100% target because no price over a positive cost can reach it. A target of 0% returns the cost itself, and a negative target returns a price below cost.
Sources and basis (retrieved 2026-10): arithmetic on your inputs using the standard textbook definitions of markup (profit / cost) and gross margin (profit / price). No outside data or third-party figures are used.
Everything runs in your browser. Nothing you type is sent or stored.
Quick reference table
| Target margin | Price on $100 cost | Markup needed | Price if cost x (1 + margin) | Real margin of that |
|---|---|---|---|---|
| 10% | $111.11 | 11.11% | $110.00 | 9.09% |
| 20% | $125.00 | 25.00% | $120.00 | 16.67% |
| 25% | $133.33 | 33.33% | $125.00 | 20.00% |
| 30% | $142.86 | 42.86% | $130.00 | 23.08% |
| 35% | $153.85 | 53.85% | $135.00 | 25.93% |
| 40% | $166.67 | 66.67% | $140.00 | 28.57% |
| 50% | $200.00 | 100.00% | $150.00 | 33.33% |
| 60% | $250.00 | 150.00% | $160.00 | 37.50% |
| 70% | $333.33 | 233.33% | $170.00 | 41.18% |
| 75% | $400.00 | 300.00% | $175.00 | 42.86% |
Common mistakes
- Multiplying cost by 1 plus the margin. That applies the margin as a markup and undershoots the target; the gap grows as the target rises.
- Forgetting that fees and discounts come off the price. If a marketplace takes a percentage, include it in cost or the achieved margin is lower.
- Rounding the price down. On a $60 cost, $100.00 is a 40.00% margin, $99.99 is 39.99% and a rounded-down $95 is only 36.84%.
- Setting the target on net profit after overhead, but entering only direct cost. Margin here is gross margin on the cost you enter.
FAQ
How do I calculate the selling price for a target profit margin?
Divide the cost by 1 minus the margin as a decimal. A $60 cost and a 40% margin is 60 / 0.60 = $100.
Why is cost x (1 + margin) wrong for a margin target?
Because margin is a percentage of the price, not the cost. Multiplying cost by 1.40 gives a 40% markup, which is a 28.57% margin.
What price gives a 50% margin?
Double the cost. A $30 cost needs a $60 price, because profit of $30 is half of $60.
Does this include tax or fees?
No. It works on the cost you enter. Add any per-unit fees to the cost first, and treat sales tax separately because it is collected on top of the price.