Calculate net margin from net profit or net income on sales revenue
Enter your net profit or net income
Enter your sales revenue
Very simple calculator you can use to easily calculate your net margin online.
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What is net margin? Definition
Net margin is an accounting indicator used to determine a company’s overall profitability in percentage terms.
A high net margin means that your company is profitable; on the contrary, if it’s negative, you need to be careful. The net margin can be used to determine the selling price of the products and services the company sells.
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What is a good net margin?
Variations in net margin as a function of products, inventory and overall market health. It’s a good idea to compare this measure with your competitors and your sector to see how you’re doing. A good net margin will be above 20% whatever the market.
A high net margin will never cover you.
Net margin formulas
You can calculate your net margin with net profit or net income and sales revenue. This calculation is based on all income and expenses.
Net margin = ( Net profit / Sales revenue ) x 100
Net margin = ( Net income / Sales revenue ) x 100
Net income equals net profit.
Example of net margin
Your company sells cell phones.
Your profit is €20,000.
Your sales revenue is €400,000.
( 20 000 / 400 000 ) * 100 = 5% net margin
Your net margin is 5%.