Free tool
Construction Markup & Margin Calculator
Markup and margin are the two most-confused numbers in construction pricing — and getting them mixed up is how jobs quietly lose money. Enter your cost and the margin or markup you want, and this tool gives you the price to quote, your profit, and the equivalent of whichever you didn't enter.
Markup vs margin — the difference that costs builders money
They are not the same. Markup is your profit as a percentage of cost; margin is your profit as a percentage of the price. A 50% markup is only a 33% margin. Pricing a job on 'add 20%' when you needed a 20% margin leaves money on the table on every single job.
- Markup % = profit ÷ cost
- Margin % = profit ÷ sale price
- Price (from margin) = cost ÷ (1 − margin)
- Price (from markup) = cost × (1 + markup)
Estimates are guidance only — always confirm critical figures against your own measurements, supplier quotes and, for tax, your accountant or HMRC.
Common questions
What's the difference between markup and margin?
Markup is profit as a percentage of your cost; margin is profit as a percentage of the price you charge. They're always different numbers: a 50% markup equals a 33.3% margin. Confusing the two is one of the most common construction pricing mistakes.
What margin should a construction company aim for?
It depends on your overheads and the type of work, so there's no universal figure — but you should set it deliberately to cover overheads and leave profit, not guess. This calculator helps you price from a target margin instead of a vague 'add a bit on top'.
How do I convert markup to margin?
Margin = markup ÷ (1 + markup). For example, a 25% markup is a 20% margin. This tool shows the equivalent automatically when you enter either one.
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