Profit Margin Calculator
Enter your job cost and target profit margin to see the selling price and profit you need — instantly.
Job Cost & Target Margin
Enter your cost and desired profit margin
Pricing a job with markup instead? Try the markup calculator.
Your Price & Profit
Selling price, profit, and margin confirmation
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