← Guides · November 9, 2026
Markup vs Margin: How to Price a Job Without Losing Money
A remodel has $8,000 materials, 120 labor hours at $38 with 25% burden ($5,700), $2,000 subs and $700 permits. Add 5% contingency and 12% overhead: total cost about $19,286.
- To keep a 20% margin, bid cost ÷ (1 − 0.20) = about $24,108, profit about $4,822.
- A 20% markup gives only $23,144, a margin of about 16.7%, about $965 less.
Why it matters
On ten jobs like this one, that gap is nearly $9,650 a year. The profit you wanted is a share of the price, not of cost.
Price your next job in the calculator.