Profit Margin Calculator

Gross profit margin is the percentage of revenue remaining after subtracting the cost of goods sold (COGS). Formula: Gross Profit Margin = (Revenue - COGS) / Revenue × 100. It measures how efficiently a business produces its goods or services before accounting for operating expenses.

Healthy profit margins vary significantly by industry. Retail typically runs 2–10% net margin. Restaurants 3–9%. Professional services 15–30%. Technology companies 15–25%. In the UAE, businesses benefit from no corporate tax on profits under AED 375,000, improving effective margins compared to other markets.

Margin is profit as a percentage of selling price. Markup is profit as a percentage of cost. Example: if cost is AED 100 and selling price is AED 150, margin is 33% (50/150) while markup is 50% (50/100). Same profit, different denominators. Most financial reporting uses margin; pricing often uses markup.