Calculate gross profit and gross margin — enter revenue and cost of goods sold (COGS) to see how much you earn before operating expenses. Results update live as you type.
Frequently Asked Questions
How is gross profit calculated?
Gross profit = Revenue − Cost of goods sold (COGS). Gross margin = (Gross profit ÷ Revenue) × 100. For example, $50,000 revenue minus $30,000 COGS gives $20,000 gross profit and a 40% margin.
What is included in COGS?
COGS covers direct costs to produce or acquire what you sell — materials, manufacturing labor, wholesale purchase price, and shipping to your warehouse. It excludes rent, marketing, and salaries.
How is gross profit different from net profit?
Gross profit is revenue minus COGS only. Net profit subtracts all operating expenses, taxes, and interest. Use the Net Profit Calculator for the full picture.
What is a good gross margin?
It varies by industry. Software and SaaS often exceed 70%; retail may be 25–50%; restaurants 60–70%. Compare against your sector benchmarks.
Is this tool free and does it work on mobile?
Yes on both counts. The Gross Profit Calculator on draft21 is completely free with no sign-up required and works on all devices.