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Free Tool — Contractor Pricing

Markup vs Margin Calculator for Contractors

A 50% markup is only a 33.3% margin — and confusing the two quietly bleeds real money out of every job. Enter your cost, pick markup or margin, and this calculator shows the selling price, the profit, and both percentages side by side so you always know the difference.

What the materials or the whole job cost you.
Enter your target as…
Markup is measured against cost; margin against the selling price.
e.g. a 50% markup adds half your cost on top.

Your Pricing Breakdown

Based on the markup you entered.

Cost $0
Profit $0
Selling Price $0
0%
Markup (on cost)
0%
Margin (on price)
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The mistake that costs you money

Say your material bill is $1,000 and you add a 50% markup. Your price is $1,500 and your profit is $500. But that $500 is only 33.3% of the $1,500 price — so your margin is 33.3%, not 50%. Contractors who quote a "50% margin" when they really mean a 50% markup are giving up roughly a third of the profit they thought they were making. Set the number you actually need, and let the tool convert.

The Markup and Margin Formulas

Both numbers describe the same profit — they just divide it by a different base. Markup compares profit to your cost. Margin compares profit to your selling price. Because the price is always bigger than the cost, the margin percentage is always smaller than the markup percentage for the same job.

// From markup → price
price  = cost × (1 + markup / 100)
margin = (price − cost) / price × 100
 
// From margin → price
price  = cost / (1 − margin / 100)
markup = (price − cost) / cost × 100

The calculator above runs whichever pair applies the moment you type, then reports the selling price, the profit in dollars, and both percentages so nothing is ambiguous. Use it alongside the materials markup calculator when you're pricing parts, or the job profit calculator when you want the full labor-plus-materials picture. Once your rate is set, the hourly rate calculator makes sure your labor line carries its share of overhead too.

Prefer a spreadsheet you can keep on file? Grab the free profit margin calculator template, or browse every free tool on the RevoField tools hub.

Markup → Margin at a Glance

Most small contractors run a 20%–35% markup, and materials are commonly marked up in that same 20%–35% band. Here's what those markups actually leave you as margin.

MarkupEquivalent margin
20%16.7%
25%20.0%
35%25.9%
50%33.3%
100%50.0%

Rule of thumb: markup = margin / (1 − margin), and margin = markup / (1 + markup). Notice the gap widens as the numbers grow — which is exactly where the costly mix-ups happen.

Markup vs Margin Questions

What is the difference between markup and margin?
Markup is profit measured against your cost; margin is profit measured against your selling price. The same $500 profit on a $1,000 cost is a 50% markup but only a 33.3% margin, because $500 is half of the cost yet only a third of the $1,500 price. Markup is always the larger number.
How do you convert markup to margin?
Use margin = markup / (1 + markup). A 50% markup is 0.50 / 1.50 = 0.333, or 33.3% margin. To reverse it, markup = margin / (1 − margin), so a 40% margin is 0.40 / 0.60 = 0.667, or 66.7% markup. The calculator does both directions instantly as you type.
What markup do most contractors use?
A 20%–35% markup is typical for small contractors, and materials are often marked up in the same range. Total-job markup runs higher to cover overhead and labor burden. If you need a specific margin to stay profitable, set the margin directly in the tool rather than guessing at a markup.
Can margin ever be 100% or more?
No. Margin is profit as a share of the price, so it can approach but never reach 100% — that would mean the item cost you nothing. Markup has no ceiling. Enter a margin of 100% or higher and the calculator shows a hint instead of a broken number, because the price formula would divide by zero.

Bake the Right Margin Into Every Quote

Knowing the number is step one — hitting it on every job is the hard part. RevoField builds quotes and invoices with your markup and margin already set, so no tech ever underprices a job in the field again.

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