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Markup vs. margin calculator
The number most contractors get wrong. See your markup % and margin % side by side so you stop underpricing every job.
What do you know?
What the job or item costs you.
Amount added on top of your cost.
| Markup | Margin |
|---|---|
| 10% | 9.1% |
| 20% | 16.7% |
| 30% | 23.1% |
| 40% | 28.6% |
| 50% | 33.3% |
Selling price
$1,250.00
$1,000.00 cost + $250.00 profit.
Markup
25.0%
Margin
20.0%
A 25% markup = 20.0% margin. They are not the same. Markup is measured against your cost; margin is measured against the price you charge.
Markup vs. margin: the formulas
Both describe profit, but they measure it against different bases:
- Markup = (price − cost) ÷ cost
- Margin = (price − cost) ÷ price
- Margin from markup = markup ÷ (1 + markup)
- Markup from margin = margin ÷ (1 − margin)
Worked example
Your cost is $1,000. You add a 25% markup, so you charge $1,250 and make $250. But $250 ÷ $1,250 is only a 20% margin. If you actually needed a 25% margin, you'd have to charge $1,333 — a 33.3% markup. That $83 gap on a single job becomes thousands across a year of underpricing.
From estimate to paid
Price it right, then bill it fast.
Build your markup into reusable quote and invoice templates so every job is priced correctly. ContractorsChat does quoting, invoicing, and payments in one place — free to start.
Frequently asked questions
Straight answers about how this calculator works and how contractors use it.