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The standard industry markup percentage is often considered to be around 15 percent. This figure is commonly used as a benchmark across various sectors within the construction and contracting industries, allowing contractors to effectively cover overhead expenses while also providing a reasonable profit margin.
When contractors apply this markup, it typically encompasses not only direct costs—such as materials and labor—but also indirect costs, such as administrative expenses and project management. By adhering to a standard markup percentage, contractors can maintain consistency in pricing and ensure competitive bids that are still financially viable.
Understanding this percentage is essential for effective budgeting and financial planning within contracting work, ensuring that projects are profitable while still being attractive to clients.