Profit Margin Calculator

Gross margin measures revenue minus cost of goods sold (COGS), showing production profitability. Operating margin subtracts operating expenses (rent, salaries, marketing) from gross profit, showing operational efficiency. Net margin subtracts all remaining expenses (taxes, interest, one-time costs), showing true bottom-line profitability. A healthy business typically has a gross margin of 40-60%, operating margin of 15-25%, and net margin of 10-20%.

A good net profit margin varies by industry. Generally: 5% is low, 10% is healthy, and 20%+ is excellent. Service businesses often achieve 15-40% net margins, while retail typically runs 2-5%. Tech companies average 15-25%. The key is consistency, not just hitting a target once. Use this calculator to compare your margins against industry benchmarks.

Improve margins by: (1) Reducing COGS through better supplier negotiations or bulk purchasing, (2) Increasing prices based on value delivered, (3) Cutting unnecessary operating expenses, (4) Automating repetitive tasks to reduce labor costs, and (5) Focusing on high-margin products or services. Tools like Dewx can help automate operations and reduce overhead costs.

Dewx provides an all-in-one business operating system with CRM deal tracking, invoicing, expense management, and real-time analytics. Track profit margins per client, per project, or per product line. Get AI-powered insights on pricing optimization and cost reduction opportunities. All integrated with your unified inbox and workflow automation.