How to Calculate Markup

[@prudentfloors9768]

Markup and Profit is an essential book...we have also been coached by Michael Stone. He knows his stuff and his knowledge has helped us tremendously.

[@rapidrhinoplumbing-monrovi3269]

Michael is the real deal guys,,,.Listen to what this man is saying about mark up. The sad truth is most guys don't know their breakeven and know less about their net mark up goal. So What is net markup guys? It means if you have a 15% net profit built into your prices, for every dollar you make you keep 15 cents in your jeans. Does that sound good or bad? To this day many guys are "paying to work" with a negative markup. McDonalds make 25% net profit for their crummy hamburgers,,,what is your profit for busting your ass doing great work all day long?

[@kleslie1968]

Priceless information! Genius veteran speaker!

[@kekomoore]

Thanks for all you do for contractors 👍

[@nickhill1216]

Pure gold!

[@benjaminu12]

Should equipment purchases (to be used on multiple future jobs and not just one job), should this be funded from overhead or profit?

[@pacorodriguez1513]

I feel like if it's worth the future use, to buy and not rent. Charge the rental price to be fair with the client. In the long run it was a good investment

[@ksu3086]

Does cost include material example my material cost 3,000 my labor 4,000 do I market up 1.50 on 7,000 or just the 4000

[@MarkupAndProfit]

Your markup should be applied to all direct job costs, so in your example, markup the $7,000. Keep in mind the 1.5 is an average, you need to calculate your correct markup, see www.markupandprofit.com/articles/calculating-your-markup/

[@ksu3086]

@@MarkupAndProfit thank you for replying back let’s say I do a bathroom remodel and the material runs me 3,000$ and my labor charge is 4000$ I should be adding 1.5 to the whole 7,000$ the reason I ask is because I am new and I did a bathroom remodel for 6,000 total and realized paying my helper myself and material I only made 1,500$ and I didn’t generate no money towards my business

[@MarkupAndProfit]

​@@ksu3086 If the correct markup for your business is 1.5, then yes, you should multiply your entire job cost by 1.5. However, if you're building the jobs and getting paid for your time on the job, the owner's salary will be less because you aren't running the business full-time, so your markup will be lower. I'd strongly suggest reading "Markup & Profit Revisited", or at least spending time with the articles on our website.

[@maryamdaftari]

Very good course has been teached by a very bad voice!