Free contractor tool
Price jobs for the margin you actually want. Enter your cost and target margin below. See the price to charge, profit dollars, and equivalent markup in real time. No email required.
Your job pricing breakdown
Enter either a markup percentage or a margin percentage and see the other one instantly.
How this works
This is the most common pricing mistake contractors make. If you want a 30% profit, you cannot add 30% on top of your cost. You have to divide by (1 minus 0.30). Here is why it matters.
Example: Your job costs $8,000 in materials and labor.
Markup is the amount you add on top of your cost, shown as a percent of cost. A 43% markup on $8,000 adds $3,429.
Margin is how much of your final price is profit, shown as a percent of the selling price. A 30% margin means 30 cents of every dollar you collect is profit.
Both numbers describe the same profit. The difference is the denominator: markup uses cost, margin uses price. Your accounting software reports margin. Most contractors think in markup. That gap is where money disappears.
The converter card above lets you translate instantly between the two so you always know which number you are working with.
Common questions
What is the difference between markup and margin?
Markup is the percentage you add on top of your cost. Margin is the percentage of your selling price that is profit. A 43% markup on a $10,000 cost job gives you a $14,300 price with a 30% margin. They describe the same profit in two different ways. Most contractors think in markup but most accounting software reports margin, which is where the confusion starts.
What profit margin should contractors aim for?
Industry estimates for residential contractors range from 20% to 40% gross profit margin depending on the trade and how job cost is defined. Specialty trades with high skill demand often run 35% or higher. These are estimates only. Your actual healthy margin depends on your overhead, market, and business model.
What should I include in job cost?
Job cost includes direct materials, direct labor (including payroll taxes and worker's comp), subcontractor fees, equipment rental for the specific job, and any permits or disposal costs tied to that job. It does not include your general overhead like office rent, insurance, or owner salary. Those are covered by your margin.
Why do contractors underprice their work?
The most common reason is using markup when they mean margin. A contractor who wants 30% profit adds 30% on top of cost (which is markup), but that only produces a 23% margin. After overhead, there is little or nothing left. The second reason is forgetting to include all direct costs, especially labor burden and subcontractor markups.
Is gross margin the same as net profit?
No. Gross profit margin is what is left after direct job costs. Net profit is what is left after you also pay all your overhead (office, insurance, marketing, owner salary, equipment payments, etc.). A 30% gross margin might leave 5% to 15% net profit after overhead, depending on your business size and efficiency.
More free tools
These tools work together. Price your jobs right, then figure out what you can afford to spend on leads to fill your pipeline.
Ready to run the real numbers?
The calculator gives you a benchmark. A strategy video gives you a real plan: which campaigns to run, what budget makes sense, and what results we would actually target for your market. No cost, no obligation.
