What Markup Gives a 15 Percent Margin?
Markup, against cost
17.6%
To keep 15 percent of the price, add 17.6 percent to a $10,000 cost: $11,764.71.
How that number is worked out
These are the figures this page was built with and every line the calculator produces from them. Change anything above and all of it moves.
- Your cost for the job10000 $
- I want to setMargin percent
- That number15 % or $
Price to charge$11,764.71
| Your cost | $10,000.00 |
|---|---|
| Price | $11,764.71 |
| Gross profit | $1,764.71 |
| Markup, against cost | 17.6% |
| Margin, against price | 15%this is the one your accountant means |
| If you want this margin | Mark up cost by | On $10,000 cost, charge |
|---|---|---|
| 10% | 11.1% | $11,111.11 |
| 15% | 17.6% | $11,764.71 |
| 20% | 25% | $12,500.00 |
| 25% | 33.3% | $13,333.33 |
| 30% | 42.9% | $14,285.71 |
| 35% | 53.8% | $15,384.62 |
| 40% | 66.7% | $16,666.67 |
| 50% | 100% | $20,000.00 |
Margin compared
Going the other way, the required markup climbs much faster than the margin does.
| Margin | Price to charge | Markup, against cost |
|---|---|---|
| 10% margin | $11,111.11 | 11.1% |
| 20% margin | $12,500.00 | 25% |
| 30% margin | $14,285.71 | 42.9% |
| 40% margin | $16,666.67 | 66.7% |
| 50% margin | $20,000.00 | 100% |
What else matters here
Fifteen percent margin needs 17.6 percent added to cost, which is already two and a half points more than the intuitive answer. On a $400,000 year that difference is over $10,000 of gross profit you either collect or do not.
The formula, if you want it, is margin divided by one minus margin. Fifteen divided by 0.85 is 17.6. It is worth keeping on a card in the truck, because it is the calculation that turns a target into a price.
Fifteen percent is a common target for high volume, low complexity work where the crew is busy and the overhead is spread thin. It is not a number that survives a slow quarter.
What this calculator assumes
- Markup is measured against your cost. Margin is measured against the price. They are never the same number and confusing them is the most expensive arithmetic mistake in the trades.
- A 50 percent markup is a 33.3 percent margin. To actually keep 50 percent of the price you have to mark up by 100 percent.
Questions people ask
What markup gives a 15 percent margin?
17.6 percent. On a $10,000 cost that is a price of $11,764.71.
What is the formula for markup from margin?
Markup equals margin divided by one minus margin. For 15 percent, that is 0.15 divided by 0.85, which is 17.6 percent.
Is a 15 percent margin normal in construction?
It is common on high volume, low complexity work. It leaves very little room for a slow period or a job that goes wrong.
The markup vs margin calculator takes any dimensions you like and hands back the same list.