Contractor pricing
Profit Margin Calculator
Know what you're actually making on each job, not just what you added on top.
Enter your job numbers
Profit = Revenue - Cost
Profit Margin = (Profit / Revenue) x 100
Markup = (Profit / Cost) x 100
If you price using markup but think in margin, your profit will be lower than expected.
Results
Margin tells you what share of the selling price stays with you. Markup tells you what you added over cost.
Profit
$2,000.00
Profit Margin
16.7%
Markup
20%
Margin needs revenue to be greater than zero. Markup needs cost to be greater than zero.
What is Profit Margin?
Profit margin is the percentage of the final selling price that remains after covering the full job cost. It answers: how much of the revenue did I actually keep?
What is Markup?
Markup is how much you add on top of cost when setting the price. It answers: how much higher is my price than my cost?
Why they are not the same
Margin uses revenue as the base. Markup uses cost as the base. Because the math starts from different numbers, the percentages are different even when the profit dollars are the same.
Quick example
Cost = $10,000
Revenue = $12,000
Profit = $2,000
Margin = 16.7%
Markup = 20%
The profit dollars are the same either way, but the percentages change because margin is based on revenue and markup is based on cost.
Related tools
Profit only exists when your numbers are clear. Tracking revenue, cost, and approvals in one place keeps your margins real.