Net Margin Calculator
Net profit margin is the bottom line: revenue minus every cost, expressed as a percentage of revenue.
Net profit
$35,000.00
Net margin
14%
Cost ratio
86%
Revenue needed for 20% margin
$268,750.00
How this was worked out
- Step 1Net profit = 250,000 − 215,000 = $35,000.00
- Step 2Net margin = 35,000 ÷ 250,000 × 100 = 14%
Formula
Net margin = ((revenue − total costs) ÷ revenue) × 100
Example
Input
Revenue $250,000, costs $215,000
Result
Net margin 14%
Frequently asked questions
It varies by industry. Software and professional services often exceed 20%; retail and hospitality are frequently in the low single digits.
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