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Enter your cost and the number you want to hit. We'll show you what to bill, and the markup-to-margin gap that quietly eats contractor profit.
The part that costs contractors money
A 20% markup is not a 20% margin. Markup is on cost; margin is on price. Here's the conversion:
| If your margin is… | …you must mark up by |
|---|---|
| 10% | 11.1% |
| 15% | 17.6% |
| 20% | 25.0% |
| 25% | 33.3% |
| 30% | 42.9% |
| 40% | 66.7% |
| 50% | 100.0% |
Mark up 20% and you only keep ~16.7% margin, the gap that quietly eats a contractor's profit on every job.
The 30-second version
Say a job costs you $10,000. If you mark it up 20%, you bill $12,000 and make $2,000, but $2,000 ÷ $12,000 is only a 16.7% margin, not 20%. The percentage shrinks because margin is measured against the bigger number (price).
To actually keep a 20% margin, you have to mark up 25% and bill $12,500. Get this backwards on every bid and you're leaving real profit on the table all year.
Bullwork handles this for you. The bid engine prices from a real cost library and applies your markup so the margin you see is the margin you keep, no spreadsheet math, no surprises at job close.
Questions
Markup is your profit as a percentage of cost. Margin is your profit as a percentage of price. Because price is bigger than cost, the same dollar of profit is always a smaller margin % than markup %. A 50% markup is only a 33% margin.
A contractor who "adds 20%" thinking it’s their margin actually keeps only ~16.7% margin. On thin construction jobs that gap is often the entire profit, repeated across every bid.
You need a 25% markup to keep a 20% margin. The formula is markup% = margin% ÷ (100 − margin%) × 100.
It varies by trade and risk, but many general contractors target 15–25% gross margin, with specialty trades often higher. The right number is the one that covers your overhead and leaves real net profit, the calculator shows what to bill to hit it.
We'll build your next bid on the platform, free. See your real margin before you submit.
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