The term **operating margin** refers to the minimum profit margin after deducting the production cost, variable costs, salaries, taxes, etc. If you get a positive figure after deducting those, that means you are having profit; it’s better if the **operating margin calculation** is higher.

You have to know all the variables or values & a calculator on your hand, you can have the value right; the calculator is specially designed for the assumption.

## What Are the Uses of Operating Margin Calculator?

Let’s see the purposes you can use an operating margin calculator for:

- First of all, you can have a net profit per product at a certain time & can take the necessary steps for your business’s betterment & avoid loss.
- Secondly, you must use it if you want to know how much currency you are spending monthly or annually for your business.

## Formula: How To Calculate Gross Profit Margin And Markup?

If you want to calculate gross profit margin and markup percentage by manually then you should need two formulas. Follow the below 2 formulas to know that how to do it manually.

### Gross Profit Margin and Markup Formula with Example:

Profit Margin Formula:

**Gross Profit Margin = (( Revenue - Cost Unit sales ) ÷ Revenue ) x 100%**

**Example:**

Suppose a startup/company’s revenue 40, Cost of Unit sale 30. Now see how to calcuate gross profit margin.

=((40-30) ÷ 40) x 100%

=(10 ÷ 40) x 100%

= **.**25 x 100%

= 25%

**Profit Markup Formula:**

`Gross profit Markup= (Revenue - Cost Unit sales ) ÷ Cost Unit sales` `x 100%`

**Example:**

Suppose revenue 40 and cost of unit sales 30. Now see how to calculate the gross profit markup.

=(40-30) ÷ 30 x 100%

=10 ÷ 30 x 100%

=0.33 x 100%

=33.33%

## Formula: Gross Profit Margin Calculator Excel:

If you want to know that how To Calculate Gross Profit Margin in Excel then make a excel sheet like the below table.

A | B | |

1 | Revenue: | |

2 | Cost of Unit sale: | |

3 | Margin: | =((B1-B2)/B1)*100% |

4 | Markup: | =(B1-B2)/B2*100% |

Input this formula on Gross profit margin cell (B3) **=((B1-B2)/B1)*100%**

Input this formula on Gross profit markup cell (B4) **=(B1-B2)/B2*100%**

You can also follow the screenshot.