Markup vs Margin Calculator
Enter your job cost and desired markup or margin to calculate your selling price, profit, and conversion between markup and margin.
Understanding Markup vs Margin for Contractors
Markup and margin are two different ways to express the same relationship between cost, revenue, and profit — but confusing them can cost you thousands on a single job.
Markup is the percentage added on top of your cost. If a job costs $10,000 and you apply a 50% markup, you charge $15,000.
Margin is the percentage of the selling price that is profit. On that same $15,000 job, your profit is $5,000, which is a 33.3% margin.
The Formulas
- Selling Price = Cost × (1 + Markup%)
- Markup % = (Selling Price − Cost) / Cost × 100
- Margin % = (Selling Price − Cost) / Selling Price × 100
- Markup to Margin: Margin = Markup / (1 + Markup)
- Margin to Markup: Markup = Margin / (1 − Margin)
Common Markup Percentages by Trade
| Trade | Typical Markup | Equivalent Margin |
|---|---|---|
| General Contracting | 15–25% | 13–20% |
| Electrical | 30–50% | 23–33% |
| Plumbing | 25–45% | 20–31% |
| HVAC | 30–50% | 23–33% |
| Roofing | 25–40% | 20–29% |
| Concrete | 20–35% | 17–26% |
FAQ
What is the difference between markup and margin?
Markup is the percentage added to your cost to get the selling price (based on cost). Margin is the percentage of the selling price that is profit (based on revenue). A 50% markup equals a 33.3% margin.
What markup should contractors use?
Most contractors use a markup between 20% and 50%, depending on the trade, project complexity, and market conditions. Specialty trades like electrical and HVAC often use 30-50% markup, while general contractors typically use 15-25%.
How do you convert markup to margin?
To convert markup to margin: Margin = Markup / (1 + Markup). For example, a 50% markup (0.50): Margin = 0.50 / 1.50 = 0.333 or 33.3%.
Contractor Co-Pilot calculates markup and margin automatically
Set your desired markup once and every estimate is priced correctly.