Profit Margin Calculator

Calculate your gross and net profit margins on construction projects. Analyze single jobs, annual business performance, or compare two jobs side by side.

Contract Amount ($)

Material Costs ($)

Labor Costs ($)

Subcontractor Costs ($)

Overhead Costs ($)

Other Costs ($)

Gross Profit

$18,000.00

Gross Margin: 36.0%

Net Profit

$8,000.00

Net Margin: 16.0%

Markup

56.3%

Break-even: $42,000

Purchase Option	Quantity	Est. Cost
Total Revenue		$50,000.00
Material Costs		$15,000.00
Labor Costs		$12,000.00
Subcontractor Costs		$5,000.00
Gross ProfitBest value	36.0%	$18,000.00
Overhead Costs		$8,000.00
Other Costs		$2,000.00
Net ProfitBest value	16.0%	$8,000.00

Healthy profit marginYour net margin of 16.0% is within the healthy range for contractors. Industry benchmarks suggest 8–15% net margin for residential and 5–10% for commercial work.

Healthy contractor margins — industry benchmarksResidential contractors typically target 8–15% net profit margin, while commercial contractors aim for 5–10%. Gross margins (before overhead) usually fall between 25–45%. If your margins are consistently below these ranges, review your estimating process, overhead allocation, and change-order practices.

This calculator provides a simplified profit margin analysis. Actual profitability depends on many factors including payment timing, warranty costs, callbacks, insurance, bonding, and tax obligations. Consult with your accountant for precise financial analysis.