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Contractor markup calculator
Enter what the job costs you and your markup. See the price to charge, the profit and the real margin. A 25% markup is only a 20% margin.
Your numbers
Markup is added on top of cost. Margin is the share of the price you keep.
Result
Price to charge$0
Profit$0
Real margin0%
For your target margin, charge$0
Markup vs margin: the difference that costs contractors money
Markup is the percentage you add to your cost. Margin is the percentage of the final price that is profit. They use the same dollars but a different base, so the margin is always smaller than the markup. If you want to keep 25% of every job, a 25% markup is not enough.
Example: a job costs you $10,000. A 25% markup makes the price $12,500. Your profit is $2,500, which is 20% of the price. To keep a real 25% margin you would need to charge $13,333, a markup of 33.3%.
Markup to margin chart
| Markup | Real margin |
|---|---|
| 10% | 9.1% |
| 20% | 16.7% |
| 25% | 20% |
| 30% | 23.1% |
| 43% | 30.1% |
| 50% | 33.3% |
| 100% | 50% |
The formulas
- Price = cost × (1 + markup)
- Margin = (price − cost) ÷ price
- Markup needed for a margin = margin ÷ (1 − margin)
- Price for a target margin = cost ÷ (1 − margin)
What should my cost include?
Include everything the job uses: materials, your crew's labor, subcontractors, permits, dump fees, equipment rental and delivery. Overhead such as insurance, the truck, the office and software is real too. Either add a share of it to each job's cost, or set your margin high enough to cover it. Use the job profit calculator to see a job with overhead included.
What margin do contractors aim for?
It depends on your trade, your market and your overhead, so there is no single right number. Many remodelers aim for a gross margin well above 20% so that overhead and profit both fit. Check your own past jobs: what you charged, what each job really cost, and what was left.
Turn the price into an estimate
Once you know your price, build a clean estimate with the free estimate maker and print it or save it as a PDF. When you want estimates, jobs, payments and profit in one place, see Vio construction CRM.