Profit Margin Calculator
Discover your potential profits using Genio's convenient profit margin calculator
Labor costs
Labor costs: The sum of all wages, insurance costs, and benefits paid to your employees by you, the employer.
Material costs
Material Costs: The direct cost used to manufacture a product or provide a service.
Overhead expenses
Overhead Expenses: The ongoing expense to operate a business. Does not include products or services sold by the business.
Service price
Service Price: The price at which your products or services are sold to your customers.
Profit margin
0%
Profit
$0
Markup
0%
Boost your profit margin by setting the perfect product prices!
Tracking and evaluating your business performance is crucial for growth. A key metric to focus on is your business’s optimal profit margin. By understanding this metric, you can strategize for profitability in the future, guiding resource allocation for sustainable expansion. Genio’s free profit margin calculator can help you make wise business decisions!
How the Profit Margin Calculator Works
The profit margin is the percentage of revenue left after subtracting core business expenses, such as rent, supplies, labor, and utilities, from total revenue. Our calculator uses this formula to make its calculations:
* Profit margin = (Service Price – Labor Costs — Material Costs — Overhead costs) x 100 / Service Price
* Markup = (Service Price – Costs) x 100 / Costs
FAQ
Why is invoicing important?
Invoicing is important as it provides a clear record of transactions, outlines payment details, facilitates smooth payment processes, and helps in maintaining accurate financial records.
What are payment terms?
Payment terms state the timeframe in which payment is expected. Common terms include "Due upon receipt" or "Net 30", meaning payment must be made within 30 days of the invoice date.
How should an invoice be delivered?
Invoices can be sent electronically via email as PDF attachments or shared through online invoicing tools. Alternatively, physical copies can be printed and mailed to the recipient.
