What Markup Gives a 22 Percent Margin?
Markup, against cost
28.2%
To keep 22 percent of the price, add 28.2 percent to a $10,000 cost: $12,820.51.
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 number22 % or $
Price to charge$12,820.51
| Your cost | $10,000.00 |
|---|---|
| Price | $12,820.51 |
| Gross profit | $2,820.51 |
| Markup, against cost | 28.2% |
| Margin, against price | 22%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
Twenty two percent margin takes a 28.2 percent markup. A job at this margin is profitable on paper and can still empty the bank account, because profit and cash are two different measurements of the same work.
Profit asks whether the price beat the cost. Cash asks when each of them moved. Payroll goes out every week, the supply house wants paying in thirty days, and the customer pays when the application is approved, which is often forty five or sixty. In between, the job is financed by you. Hold ten percent retainage on this job as well and $1,282.05 sits somewhere else until closeout, which is over forty five percent of the entire profit on the work.
The levers are in the contract rather than in the percentage: a deposit large enough to buy the first materials, draws tied to milestones rather than dates, an invoice submitted the day the milestone is met rather than at the end of the month, and a late fee that exists and is enforced. A profitable business that runs out of cash closes just as firmly as an unprofitable one.
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 22 percent margin?
28.2 percent. On a $10,000 cost that is a price of $12,820.51 and $2,820.51 of gross profit.
Can a profitable job still cause a cash problem?
Easily. Payroll is weekly, suppliers want thirty days and customers often pay in forty five or sixty, so the job is financed by you in between.
How much does retainage cost at this margin?
Ten percent retainage on a $12,820.51 job is $1,282.05, which is over 45 percent of the gross profit, held somewhere else until the job closes out.
The markup vs margin calculator takes any dimensions you like and hands back the same list.