Product Pricing Calculator
Estimate a selling price, profit amount, profit margin and markup based on your product cost and target pricing goals.
Overview
A product pricing calculator helps you estimate how much to charge for each unit based on your base cost, extra per-unit expenses, and a target margin or markup. It is useful for checking whether your planned selling price leaves enough room for profit before tax is added.
How it works
The calculator first adds your base cost and extra per-unit costs to get total unit cost. If you choose target margin, it works backwards from the margin formula so the selling price is high enough for profit to represent the percentage of selling price you entered. If you choose markup, it adds your markup percentage directly to total cost. It then shows the resulting profit per unit, margin, markup and optional tax-inclusive price.
How to use this calculator
- 1Enter your base product cost per unit.
- 2Add any extra per-unit costs such as packaging or shipping.
- 3Choose whether you want to price by target margin or markup.
- 4Enter your target percentage.
- 5Add a sales tax rate if you want to see the customer price including tax.
- 6Review the suggested selling price, profit per unit and margin.
Example Calculation
Base product cost
$25
Extra cost per unit
$5
Pricing method
margin
Target profit margin
40%
Sales tax rate
8%
Recommended selling price
N/A
If your base cost is 25 and extra per-unit costs are 5, your total cost is 30. With a 40% target margin, the estimated pre-tax selling price is 50, profit per unit is 20, and the price including 8% tax is 54.
Frequently asked questions
What is the difference between margin and markup?
Margin is profit as a percentage of selling price, while markup is profit as a percentage of cost. The same product can have different margin and markup percentages.
Should I include shipping and packaging in my cost?
Yes, if those costs apply to each unit sold, include them as extra per-unit costs so your pricing estimate is more realistic.
Does this calculator include tax in profit?
No. Sales tax is added separately to estimate the customer price including tax and is not counted as profit.
Can I use this calculator for retail and ecommerce products?
Yes. It can be used for physical goods, handmade products, wholesale items and many ecommerce products as long as you enter per-unit costs accurately.
Why is the selling price higher when I use a target margin?
A target margin works from the final selling price, not just from cost. That usually requires a higher selling price than an equivalent-looking markup percentage.
Does this calculator include fixed overheads?
Not automatically. If you want to recover fixed overheads per sale, add an estimated share of those costs to the extra per-unit cost field.
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Assumptions and warnings
Assumptions
- Results are estimated per unit and assume your entered costs are accurate.
- This calculator uses either a target margin or a markup on total unit cost.
- Sales tax is added after the selling price and is not treated as profit.
- Fixed overheads, discounts, refunds and marketplace fees are only included if you add them to per-unit costs.
Warnings
- This calculator provides an estimate only and should not be treated as accounting, tax or pricing advice.
- Tax treatment, fees and pricing strategy can vary by business and location.