Gross Margin, Contribution Margin and Net Margin Calculator
Free tool · Updated October 2, 2026 · By CouponTalk · Reviewed by CouponTalk Expert Reviews on
Your result
Enter your measurements to see your result.
Quick answer
Gross margin is revenue minus product cost. Contribution margin also takes off variable costs such as fees, shipping and ads. Net margin takes off fixed costs too. On ₹5 lakh of sales with ₹2.8 lakh product cost, ₹90,000 variable and ₹70,000 fixed costs, margins are 44%, 26% and 12%.
How to use this calculator
- Use one period, such as last month.
- Enter revenue without GST and the cost of the goods you sold.
- Split other costs into variable (per order) and fixed (monthly).
Formula
Gross margin = (revenue − product cost) ÷ revenue
Contribution margin = (revenue − product cost − variable costs) ÷ revenue
Net margin = (revenue − all costs) ÷ revenue
Use figures from your accounts for one period so the margins compare fairly.
Frequently asked questions
What is the difference between gross and net margin?
Gross margin only counts product cost. Net margin counts every cost, including fixed costs, so it is what you actually keep.
Why does contribution margin matter?
It shows how much each sale adds towards fixed costs. Use it to find your break-even orders.
Is margin the same as markup?
No. Margin is profit ÷ price; markup is profit ÷ cost. See the margin vs markup calculator.
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