Markup vs. Margin: Avoid a Common Mistake

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Business Advice

Updated March 4, 2024

Everyone’s looking for ways to add a couple of points to their bottom line, but did you know that 85% of contractors are giving away profit on every job because of a simple pricing error?

We’re sure you’ve heard the terms profit margin and profit markup before, but if you’re like most landscape contractors, you haven’t put much thought into the difference when estimating and pricing your jobs.  The secret is, there is a big difference and not knowing that difference will mean you’re coming up short on every estimate that goes out your door.  Priced incorrectly (and most contractors do), you’re short profit at the end of the year, you are negotiating prices with a false (inflated) sense of profitability, and you’re probably wondering… where is all our money going?

In this market, every percent counts.  If you or your estimators aren’t 100% sure that you understand how a markup is different than a margin, then watch this video.  It’s the quickest and easiest profit you’ve ever added to your bottom line.

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