Contractor job pricing
Contractor Markup Calculator
Start with what a job costs, then apply markup, target a margin, or check the markup and margin inside a proposed selling price.
Result breakdown
How the selling price is built
Values use the active cost and calculation modes.
- Labor
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- Materials
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- Subcontractors
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- Equipment / other direct costs
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- Allocated overhead
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- Entered job cost
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- Selling / bid price
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- Markup amount
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- Markup
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- Equivalent margin
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- Cost multiplier
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Choose the right pricing tool
Pricing your own billable time?
Pricing your own billable time rather than marking up a complete job cost? Use the Contractor Hourly Rate Calculator.
Once the job is complete, compare estimated and actual job profitability.
Markup vs margin
The percentages use different denominators
Apply 25% markup
$10,000 cost + 25% markup = $12,500 selling price
Markup amount: $2,500
Equivalent margin: 20%
Target 25% margin
Selling price: $13,333.33
Required markup: approximately 33.33%
Markup uses cost as its denominator. Margin uses selling price as its denominator. That is why 25% markup is not the same as 25% margin.
Methodology
How the calculator works
Selling Price = Cost × (1 + Markup)
Markup % = (Selling Price − Cost) ÷ Cost
Margin % = (Selling Price − Cost) ÷ Selling Price
Price from Target Margin = Cost ÷ (1 − Margin)
Enter the job costs and allocated overhead you want this markup applied to. Allocated overhead is a user-entered dollar amount in V1; the calculator does not choose an allocation method. Do not include the same cost both here and elsewhere in your pricing model.
Before marking up employee labor, make sure the estimate starts from fully burdened labor cost rather than base wages. Learn how to use labor burden correctly in estimates.
Markup amount is not automatically final net profit. This is the margin relative to the costs entered here. It is not necessarily your final net profit margin if additional overhead or business costs still need to be recovered.
This calculator provides business planning and educational information—not tax, accounting, legal, or financial advice.
FAQ
Contractor markup questions
What is contractor markup?
Markup is the amount added to the entered job cost to reach a selling price. Markup percentage uses cost as its denominator.
What is the difference between markup and margin?
Markup compares the added amount with cost. Margin compares the same amount with selling price, so the percentages are not interchangeable.
What margin does 25% markup produce?
A 25% markup produces a 20% margin on the entered cost basis.
What markup gives a 25% margin?
A 25% target margin requires approximately 33.33% markup on cost.
Should contractors mark up labor and materials?
Include the job costs you intend the selling price to recover. The appropriate cost basis and pricing policy depend on the business and job.
Should overhead be included before markup?
Include any allocated overhead you want this job price to recover, but do not count the same overhead in more than one place.
What if my selling price is below my job cost?
Check a price mode accepts it and shows negative markup and margin values so you can see that the proposed price is below the entered cost basis.