Skip to content
Get the app

Contractor margin and markup calculator

Enter your cost and markup to see the price, profit and true margin. Or enter the contract price and your cost for your real profit. For cost-plus jobs, see what you lose when client-paid items are left out of your fee.

Contractor margin and markup calculator · Qidda

%
%
%
If you enter it, the price is built from it and the markup field is ignored.

The result appears here.

Send on WhatsApp

Calculated at qidda.app/en/tools/ · Qidda: fit-out project accounts · approximate

Calculated the expected profit? Track the real one.

Qidda builds each project's cost from the actual invoices, so you see real profit, not forecast. The first project is free.

Start freePricing

How to use the calculator

  1. Choose the mode: cost to price, price to profit, cost-plus contract or conversion table.
  2. Enter direct cost, overhead (a percentage of cost) and markup, or the margin you are aiming for.
  3. Read the price, profit, margin and markup, and open "How we calculated" for the formula.
  4. Share the result as a link or print it.

Markup and margin are different numbers

Markup = profit / cost. Margin = profit / price. Cost 100,000 plus 25% gives a price of 125,000 and a profit of 25,000: markup is 25%, margin only 20%. That is why "I add 25% to everything" does not mean you earn 25%.

price  = cost x (1 + overhead%) x (1 + markup%)
margin = markup / (1 + markup)       markup = margin / (1 - margin)
price for a target margin = cost / (1 - margin)
cost-plus fee = fee% x (paid by contractor + paid by client)

Worked examples

  • Direct cost 400,000, no overhead, 25% markup: price 500,000, profit 100,000, margin 20.0%.
  • Cost-plus job: the contractor paid 300,000 and the client paid 100,000 directly, fee 15%: the fee on the 400,000 total is 60,000. Leave the client-paid part out and it becomes 45,000: you lose 15,000.

What is a normal contractor margin?

There is no single figure we can give you; it depends on the trade, the contract, the company size and overheads. Published numbers are examples with dates: an Egyptian expert said in 2017 that large contractors' margins do not exceed about 5% of turnover, and US figures (Buildern, June 2026) describe a different market. Start from your real overheads and decide the net margin you need.

Where profit leaks

  • A markup on cost that you treat as a margin on price.
  • Overheads (office, vehicles, salaries) that never entered the price.
  • Materials the client bought directly dropped from the fee base in a cost-plus contract.
  • Unrecorded credit invoices from subcontractors.

FAQ

What is the difference between markup and margin?

Markup is profit divided by cost; margin is profit divided by price. A 25% markup gives a 20% margin.

What is a normal contractor profit margin?

There is no single normal figure; it depends on the trade, contract type, company size and overheads. Work out yours from your real overheads and the net margin you need.

How do I price for a target margin?

Divide cost by (1 - target margin). For a 20% margin on a cost of 100,000, price at 125,000.

How do I protect profit on a cost-plus job?

Record every cost on the project, including materials the client pays for directly, because your fee is a percentage of total cost. Agree in writing what counts in the fee base.

What are overheads?

Costs the company carries that do not belong to one project: office rent, fixed salaries, vehicles, phones. The price has to cover them.

Sources

  1. Youm7, expert on contractors' margins (Egypt): www.youm7.com/story/2017/5/30/خبير-هامش-ربح-المقاولين-لا-يتجاوز-5-من-ح (30 May 2017; accessed 2026-11-13)
  2. Buildern, General Contractor Markup: buildern.com/resources/blog/general-contractor-markup/ (June 2026, US market; accessed 2026-11-13)