Gross Margin Calculator
Gross margin shows how much of each sale is left after the direct cost of delivering it. Software businesses typically run 70–85%.
Your numbers
RESULT
Gross margin
72%
Gross profit
$720K
- Markup on cost
- 257.1%
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- Gross profit = Revenue − Cost of goods sold
- Gross margin % = Gross profit ÷ Revenue
- Markup % = Gross profit ÷ COGS
Frequently asked questions
What goes into COGS for a software company?
Hosting and infrastructure, third-party licences used to deliver the product, payment processing, and customer support and onboarding staff.
What is a good gross margin?
SaaS 70–85%, marketplaces 60–80% of net revenue, e-commerce 30–50%, hardware 20–40%.
Margin vs markup?
Margin divides profit by the selling price; markup divides it by cost. A 50% markup is only a 33% margin.
Results are estimates for planning and education — not financial, legal or tax advice.
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