Pricing Summary
- Materials$—
- Labor$—
- Overhead$—
- Cost basis$—
- Profit$—
- Sell price$—
- Tax$—
- Shipping / delivery$—
- Total customer price$—
Common Markup by Trade
| Trade / work | Typical material markup |
|---|---|
| General contractor | 10 – 20% |
| Remodeling | 15 – 25% |
| Specialty trade (electrical, plumbing) | 20 – 40% |
| Small parts / consumables | 50 – 100% |
| Large materials packages | 10 – 15% |
Markup vs Margin: What Is the Difference?
This is the trap that catches most contractors. Markup is profit measured against your cost, while margin is profit measured against the price you charge, so they are never the same number. Marking a twelve hundred dollar material cost up by twenty-five percent gives a fifteen hundred dollar price and three hundred dollars of profit, but that profit is only a twenty percent margin of the sale. If you think in markup but budget in margin, you quietly earn less than you planned. The toggle on this calculator lets you price either way and always shows both numbers so there is no confusion.
How to Price Materials as a Contractor
A real price is more than cost plus a number. Start with materials, add labor and overhead to get your true cost basis, apply a markup or target margin to set profit, then add tax and delivery to reach the price the customer pays. Overhead, the cost of simply being in business, is the line contractors forget most, and leaving it out is why a job can look profitable and still lose money. This tool builds the price up in that order so nothing is missed.
How Much Should You Mark Up Materials?
Typical material markups run ten to twenty percent for general contractors, fifteen to twenty-five for remodeling, and higher for specialty trades and small parts where handling and risk are proportionally larger. Small jobs justify higher markups than big material packages because the fixed effort is spread over fewer dollars. The right answer depends on your market, your costs, and the size of the job, so use the trade ranges as a starting point and adjust for your business.
Frequently Asked Questions
Is markup the same as margin? No. Markup is profit over cost; margin is profit over price. A 25 percent markup is a 20 percent margin.
What markup should a contractor use on materials? Commonly 15 to 25 percent on larger jobs, more on small parts and specialty work.
How do I hit a target margin? Set the toggle to Margin and enter your target; the price is solved so the margin is exact.
Should labor and overhead be marked up too? Price them in the cost basis, then apply profit on the whole, so every cost is covered.