Are materials being marked up, missed, wasted, or eaten? Material Recovery Calculator
Estimate whether parts, materials, equipment, supplies, warranty, discounts, or poor tracking may be eating margin. Uses your material spend and target markup.
How it works
Estimate first. Verify next.
Frequently asked questions
What markup should contractors charge on materials?
It varies by trade: HVAC typically marks up 40–55%, plumbing 45–60%, electrical 30–40%, roofing 25–35%, GC/remodelers 20–30%. This calculator uses your industry's benchmark if you do not know your own.
How do I know if materials are eating my profit?
Compare your total material spend against your total material revenue. If the implied markup is below your target, the difference is margin walking out the door through missed billing, discounts, warranty, waste, or purchasing. This calculator sizes that gap.
Why are my material costs so high?
Common causes: not billing materials on every job, eating warranty parts, giving discounts without tracking them, poor purchasing, inventory shrinkage, change orders billed late or missed, and not separating material from labor in accounting. The Checkup verifies which ones apply.
What is the difference between markup and margin?
Markup is the percentage added to cost (buy $100, sell $150 = 50% markup). Margin is the percentage of the selling price that is profit ($50 profit / $150 price = 33% margin). They describe the same dollars differently. This calculator works with markup.
Is this calculator accurate?
It compares your stated material spend and revenue against your target markup. If you cannot separate material revenue from labor revenue, that is itself a major finding — and exactly what the Business Checkup would verify.
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This is not meant to replace a real analysis.
The calculator is a starting point. The Business Checkup is where a senior analyst verifies the numbers and finds the operational cause behind the problem.