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General Contractor Markup Guide: Rates by Trade, Fee Structures, and Margin Math

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  The average GC applies a 15–20% markup and walks away with 3–5% net profit. The gap between those two numbers — markup and actual margin — is where most construction businesses bleed out. Markup is not margin . Overhead is not profit. A GC fee is not a markup. These distinctions cost contractors hundreds of thousands of dollars over a career because the math is applied wrong from the first estimate. Markup vs. Margin: The Formula Most Contractors Get Wrong Markup = Profit ÷ Cost × 100 Margin = Profit ÷ Revenue × 100 A 20% markup produces a 16.7% margin — not 20%. Markup needed to achieve target margin: Target Net Margin Required Markup on Cost 10% 11.1% 15% 17.6% 20% 25.0% 25% 33.3% 30% 42.9% 35% 53.8% Formula: Markup % = Margin % ÷ (1 − Margin %) What the Markup Must Cover Markup covers two things beyond direct costs : overhead (fixed costs of running the business) and profit . Overhead rate = Annual Overhead ÷ Annual Revenue Example — $100,000 direct cost job with 20% overh...
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Construction Bid Template: Win More Jobs With a Professional Bid Package

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  Contractors who submit structured, itemized bids win contracts at a 34% higher rate than those submitting lump-sum numbers with no breakdown, according to a 2025 Associated General Contractors survey. Yet most small contractors still send a single-page quote with a bottom line and a handshake. A professional bid package does more than impress — it protects you. An itemized bid establishes scope, unit prices, exclusions, and assumptions before work starts. When the owner adds scope, you have a signed document showing exactly what was and wasn't included. This guide covers the difference between a bid and a proposal, how to structure a winning bid package , and includes copy-ready templates for every document in the package.   Bid vs. Proposal vs. Quote: What's the Difference Document What It Is When to Use Bid Price response to a defined scope (usually owner-provided drawings/specs) Public projects, GC invitations, design-bid-build Proposal Your defined scope + your price; y...
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