What is Markup?
Markup is how much you add on top of cost to arrive at your selling price. If a job costs $1,000 and you add 20% markup, the price becomes $1,200.
Contractor pricing
Markup vs Margin Calculator
Understand the difference and price your jobs correctly.
What this answers: markup versus actual margin
Enter your job cost and intended markup to see the selling price, gross profit, and actual margin side by side.
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Your pricing result
- Selling price
- $1,200.00
- Gross profit
- $200.00
- Margin %
- 16.7%
A 20.0% markup results in a 16.7% margin - not the same thing.
Common mistake
Adding 20% markup does NOT mean 20% profit margin. Margin is always lower than markup.
Need to price for a target margin?
Solve backward from the margin you want to the selling price the job needs.
Calculate required selling price →Education
What is Margin?
Margin is the share of the final price that remains after covering cost. On a $1,200 sale with $1,000 in cost, the gross profit is $200, which is a 16.67% margin.
Why contractors get this wrong
Contractors often use markup when they mean margin. That leads to bids that look profitable on paper but do not leave enough room for overhead, callbacks, taxes, or actual net profit.
Related resources
contractor proposal templateOpen the related StackQuotes resource.roofing estimate templateOpen the related StackQuotes resource.Markup vs Margin GuideOpen the related StackQuotes resource.Labor Burden CalculatorOpen the related StackQuotes resource.Why Contractors UnderpriceOpen the related StackQuotes resource.
Most contractors lose money not because of bad work, but because of bad math.
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