How to calculate markup
Markup is the amount you add on top of your cost, shown as a percent of that cost. The formula is simple: selling price = cost x (1 + markup %). A $4,000 job at 30% markup sells for $5,200.
To find the markup you already used on a past job, take (price - cost) / cost. If you charged $5,200 and the job cost $4,000, that is $1,200 / $4,000 = 30%.
Markup vs margin: the mistake that eats profit
Margin is profit as a percent of the selling price, not the cost. That same $5,200 job has a margin of $1,200 / $5,200 = 23%. Markup always reads higher than margin for the same job.
This matters when you set a goal. If your business needs to keep 30% of every invoice to cover overhead and pay you, a 30% markup falls short. You need about a 43% markup to land a 30% margin. Use the "I want a margin" tab above and it does the conversion for you.
What markup should a contractor use?
Most residential trades land somewhere between 20% and 50% markup on job cost, with smaller service calls running higher because the drive, setup and paperwork cost the same whether the job is $300 or $3,000.
Start from your numbers, not an industry average. Add up a year of overhead (truck, insurance, office, software, phone, your own non-billable time), divide by your yearly job costs, then add the profit you want on top. That is your floor. Specialty work, rush jobs and warranty-heavy installs can carry more.
Put the number to work
A good markup only pays if it actually ends up on the estimate. In QuotesForge you set your default markup once, every line item prices from it, and the quote shows the customer a clean total while you see the profit on every job.