Business Profit Suite
Calculate your gross profit.
Calculate your gross profit instantly. Enter revenue and cost of goods sold to see your gross profit and margin - free online business calculator.
Gross Profit
Purpose
Calculates the profit earned after deducting the Cost of Goods Sold (COGS) from total revenue.
Formula
Gross Profit = Revenue - Cost of Goods Sold (COGS)What is Gross Profit?
Gross profit is the money a business retains after deducting the direct costs of producing goods or delivering services (COGS) from total sales revenue, before operating expenses, interest, or taxes are factored in.
How It Works
Worked Example
A retail store generates ₹5,00,000 in monthly sales. The inventory acquisition, packaging, and freight costs total ₹3,20,000. Gross Profit = ₹5,00,000 − ₹3,20,000 = ₹1,80,000.
When to Use This
Use gross profit to evaluate if your core pricing model is structurally sound before considering overhead. It is the primary financial indicator reviewed by commercial lenders and investors.
Why Use This Tool?
Confusing top-line revenue with real profit is the single most common reason young businesses run into sudden liquidity crises. Tracking gross profit ensures you never sell high volumes of product at prices that fail to cover underlying material and labor costs.
Data privacy is guaranteed: all calculations run directly in your browser session and are never stored or shared with external parties.
Frequently Asked Questions
What is gross profit?
Gross profit is revenue minus cost of goods sold (COGS). It shows how much money a business retains after direct production costs before operating expenses.
How is gross profit different from net profit?
Gross profit only deducts COGS, while net profit deducts all expenses including operating costs, taxes, and interest.