Profit Margin Calculator
Enter your job cost and the profit margin you want to keep. See the selling price you need, the profit, and the markup that gets you there. Then download or print a clean summary.
- Live results
- Margin vs markup
- PDF summary
Your job
Add your cost and the share of the price you want to keep as profit.
Pricing a job with markup instead? Try the markup calculator.
Your price
Updates as you type.
What Is Profit Margin?
Profit margin is the percentage of your selling price that is profit — not the percentage of your cost. If a job sells for $12,500 and costs $10,000, your $2,500 profit is a 20% margin, because it's 20% of the $12,500 selling price.
How Contractors Calculate Profit Margin
Most contractors don't start with a margin and check it afterward — they start with a target margin and work forward to find the selling price that produces it:
Once you have the selling price, profit is simply Selling Price − Job Cost — the calculator above shows both, along with a margin confirmation so you can see it's calculated correctly.
Margin vs Markup
Margin and markup are easy to confuse, but they measure different things. Margin is profit divided by selling price. Markup is profit divided by cost. Because the selling price is always larger than the cost, margin is always a smaller number than markup for the same profit — a 20% target margin actually requires a 25% markup on cost, not 20%.
Calculating margin from cost instead of selling price is one of the most common — and costly — pricing mistakes contractors make. It quietly overstates how much profit a job is really keeping.
Worked Example
Using a $10,000 job cost with a 20% target margin:
The margin is confirmed against the selling price ($12,500), not the cost ($10,000) — that's what keeps the math honest and matches the target margin you actually set.
How Margin Fits Into a Construction Estimate
Margin doesn't automatically account for your overhead — rent, insurance, equipment, admin costs — unless you build those into the job cost yourself before setting your target margin. QuickEstimate applies your labor cost, overhead, and target margin automatically to every estimate, so you're not repeating this math by hand on every bid.
- Start with your true labor cost — see the employee cost calculator
- Add materials and overhead to get your real job cost
- Set your target margin to arrive at a selling price that protects your profit