Profit Margin Calculator
Calculate all three key profit margins — gross, operating, and net — from your revenue and cost figures.
How it's calculated
Gross margin = (Revenue − COGS) ÷ RevenueOperating margin = (Gross profit − OpEx) ÷ RevenueNet margin = Operating profit − Tax & interest) ÷ Revenue
Frequently Asked Questions
- What is a good profit margin for a UK business?
- There is no single good margin — it depends entirely on your industry. Retail typically nets 2–10%. SaaS companies run 20–40%. Professional services usually land between 15% and 30%. Compare yourself against your own sector rather than a general benchmark, and track the trend over time. The direction matters more than the absolute number.
- What is the difference between gross and net profit margin?
- Gross margin deducts only your cost of goods sold. It tells you how efficiently you produce or deliver what you sell. Net margin deducts everything else too — operating expenses, interest and tax — so it tells you what the business actually keeps. A healthy gross margin alongside a weak net margin means your overheads, not your pricing, are the problem.
- What counts as operating expenses (OpEx)?
- Operating expenses are the costs of running the business rather than making the product: rent, salaries, marketing, utilities and administrative costs. Cost of goods sold is not included. COGS covers the direct cost of producing what you sell, and it has already been deducted before you reach the operating line.