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Weighted Margin Calculator

Combine two product lines using revenue weights, with gross profit dollars and a check for losses instead of averaging their percentages.

By PriceAndProfit Editorial Updated

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Fill in the fields: the result appears under the form, with the formula below it.

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Formula and cost boundary

Combined gross margin = (total revenue − total COGS) ÷ total revenue × 100

Use the same period and cost-of-goods-sold boundary for both products. Adding their percentages and dividing by two is valid only with equal revenues. A zero-revenue line can still carry costs; the combined revenue must be positive. Negative gross profit is retained. This is gross profit before selling costs and overhead, not net income.

Worked example: Revenue-weighted result

The following inputs are hypothetical values for checking the calculation. They are not recommended prices, wages, margins or platform charges. Keep the units and period shown in each label when replacing them with your own records.

Inputs for this worked example
InputExample value
Revenue for product A $1,000
Cost of goods sold for A $600
Revenue for product B $3,000
Cost of goods sold for B $2,400
Outputs from the displayed inputs
ResultCalculated value
Combined gross margin 25%
Combined gross profit $1,000
Combined revenue $4,000

Using the result

Save the input set alongside the source date of each quote or cost record. Review the cost boundary before comparing this result with another report: a contribution measure may exclude overhead, and a cash measure follows payment dates. Display rounding does not change the underlying assumptions. Recalculate when an input changes; the tool does not predict future sales or collections.

Are any rates supplied automatically?

No. Numeric fields are your inputs. Example values demonstrate arithmetic only. Check your contracts and records for the amounts that apply to your business.

Why might a result be unavailable or negative?

A missing denominator or inconsistent inputs can make the calculation undefined. Those combinations are rejected or labeled explicitly. A valid negative result remains visible because it may identify a loss or cash shortfall.

Method reference: UVM Extension: Mark-up and Margins to Set Prices. Checked October 22, 2026. Margin and markup denominators only; historical industry percentages are not reused.

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