Start with a consistent cost basis
List the labor, materials and allocated overhead you expect the job to carry. Omitting an expense can overstate what remains for your business. Keep your cost assumptions consistent when comparing jobs.
These examples exclude tax and use fictional costs. The remainder is not necessarily take-home profit: payment fees and other unlisted expenses may still apply.
Calculate markup from cost
Markup amount = cost × markup percentage.
Selling price = cost + markup amount.
With $1,000 cost and a 25% markup: $1,000 × 0.25 = $250 added; $1,000 + $250 = $1,250 before tax.
Calculate margin from selling price
Margin = (selling price − cost) ÷ selling price × 100.
The $250 remaining is 20% of $1,250. It is 25% of cost, but 20% of selling price.
| Markup | Price | Margin |
|---|---|---|
| 10% | $1,100 | 9.09% |
| 25% | $1,250 | 20% |
| 50% | $1,500 | 33.33% |
Work backward from a target margin
Price = cost ÷ (1 − target margin as a decimal).
A 25% target margin on $1,000 gives $1,000 ÷ 0.75 = $1,333.33 after rounding. That is approximately a 33.33% markup. The formula requires a target margin below 100%.
The website calculator accepts markup, not target margin. Enter 33.33% markup to approximate this example; small rounding differences are expected.
Check your numbers, then prepare the estimate
If your customer-facing rates already contain markup, adding it again changes the intended price. Decide whether you are working from costs or selling rates before entering items.
Check your costs and markup in the free calculator →
Once you have reviewed your numbers, enter the items in BidBuddy to prepare the customer document. Calculator inputs are not automatically transferred to the app.
Put the plan into a professional estimate.
Enter your reviewed items in BidBuddy, add the customer and preview your PDF. Keep the estimate and its next step together on your iPhone.
Create your estimate in BidBuddyFree to download. In-app subscriptions available. Website examples do not automatically import into the app.
Prepared by the team behind BidBuddy. Examples illustrate estimate preparation; fictional amounts are not local price guidance. Review the scope and figures against the actual job. Send a correction or question.
