Direct costs
Materials and labor are your direct costs — the dollars that exist only because the job exists. Track them precisely; everything else is calculated from this base.
Built for the little guys
Job Estimate Calculator for Contractors
Create accurate estimates, professional proposals, and profitable bids in minutes with AI-powered guidance.
Step 1
Enter your costs
Add material and labor totals for the job.
Step 2
Set overhead & profit
Choose your overhead and target margin.
Step 3
Get your bid
See total cost, bid price, profit and margin.
YOUR FREE BID CALCULATOR
Enter your costs below and see your total cost, recommended bid, profit and margin update live.
Bid Buddy AI
BetaYour hands-free estimating buddy.
Hi! I'm Bid Buddy, your AI bidding assistant. I'll guide you step by step through your bid. You don't need bidding experience. Just answer a few questions and together we'll build a professional bid.
Your bid
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Your bid is calculated as total cost ÷ (1 − margin) for a true margin.
Total job cost
$23,000.00
Recommended bid
$28,750.00
Profit
$5,750.00
Margin
20%
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Contractor markup & margin, explained
Pricing a job is more than adding parts and hours. Understand the four numbers that decide whether you make money.
Overhead
Overhead keeps the lights on between jobs. Add it as a percentage of direct cost so every estimate carries its fair share of insurance, fuel, and tools.
Markup vs. margin
Markup is on cost, margin is on price. A 50% markup is only a 33% margin. Always price to a target margin so the profit you keep is what you planned.
Profit
Profit is your reward for risk and expertise — not leftover change. Build it into the bid deliberately instead of hoping it survives at the end of the job.
How to price a job to a target margin
Start with your direct costs — the materials and labor a job consumes. Next, apply your overhead percentage so the estimate shoulders its share of insurance, vehicles, tools, and office costs. Together these form your true total cost.
The mistake most contractors make is adding their desired profit percentage on top of cost. That is a markup, and it always produces a smaller margin than expected. To actually keep, say, 20% of the price as profit, divide your total cost by (1 − 0.20). A $24,000 cost becomes a $30,000 bid, leaving exactly $6,000 — a real 20% margin.
The calculator above does this math for you, but knowing the formula keeps you in control when a client negotiates or a job changes scope. Protect the margin, not the markup, and your business stays healthy job after job.
A worked example, start to finish
Say you are quoting an interior repaint: three bedrooms and a hallway. You walk the job and count 26 hours of work. Your labor costs you $54 an hour once payroll taxes, insurance, and unbillable driving time are folded in, so labor is $1,404. Eleven gallons of paint, primer, tape, and drop cloths come to $430.
Overhead is the part most contractors leave out. If your truck, insurance, phone, software, and advertising add up to $16,000 a year and you bill roughly 1,250 hours, each billable hour carries about $13 of overhead. Twenty-six hours means $338 of overhead belongs to this job. Your true cost is $2,172 — not the $1,834 you would have used if you only counted labor and paint.
Now apply the margin. At a 28% target, the bid is $2,172 divided by 0.72, which is $3,017. Round it to $3,000 and you keep about $828. Had you instead marked the cost up by 28%, you would have quoted $2,780 and kept $608 — the same job, the same work, roughly $220 less in your pocket because of one arithmetic habit.
Common questions about these numbers
What overhead percentage should I enter?
Do not guess at a percentage — work out your own. Add twelve months of costs you pay whether or not you are working, then divide by the hours you can actually bill. Most solo contractors land somewhere between 10% and 20% of job cost, but the honest number is the one that comes out of your own bank statements.
Is my profit percentage margin or markup?
In this calculator it is margin — profit as a share of the price the customer pays. That is why the math divides rather than multiplies. If you are used to thinking in markup, remember that a 30% markup is only a 23% margin, and hitting a 30% margin takes a 43% markup.
Should I show the customer this breakdown?
Usually not in this form. Customers respond to a clear scope of work, a list of what is excluded, and one total price. Your hourly rate and margin are internal numbers. Showing them turns a conversation about the value of the work into an argument about wages.
What if the job runs long?
Extra hours caused by the customer changing their mind belong in a written change order, priced the same way as the original bid. Extra hours caused by your own estimate being optimistic belong in your notes, so next time the hours you enter here reflect how fast you really work.
Longer explanations of each step live in the guide to pricing a job, the markup versus margin breakdown, and the overhead calculation walkthrough.
Trade-specific cost calculators
Jump to a bidding guide built for your trade — each one includes the same Bid Buddy calculator.
Get in touch
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