How Much Do You Mark Up A Subcontractor's Work? - Business - Contractor Talk

How Much Do You Mark Up A Subcontractor's Work?

 
Thread Tools Search this Thread Display Modes
Old 12-05-2019, 02:55 PM   #1
Member
 
jwatts's Avatar
 
Trade: c-27
Join Date: Sep 2013
Location: califonia
Posts: 43
Rewards Points: 82

How Much Do You Mark Up A Subcontractor's Work?


Do add on a percentage or???
jwatts is offline  

Warning: The topics covered on this site include activities in which there exists the potential for serious injury or death. ContractorTalk.com DOES NOT guarantee the accuracy or completeness of any information contained on this site. Always use proper safety precaution and reference reliable outside sources before attempting any construction or remodeling task!

   

Advertisement

 

Old 12-05-2019, 04:25 PM   #2
Contractor of the Month
 
Inner10's Avatar
 
Trade: Control Systems
Join Date: Mar 2009
Location: Ottawa, ON
Posts: 26,075
Rewards Points: 5,076

Re: How Much Do You Mark Up A Subcontractor's Work?


15-20 percent.

Advertisement

__________________
The Following User Says Thank You to Inner10 For This Useful Post: Leo G
Inner10 is offline  
The Following User Says Thank You to Inner10 For This Useful Post:
DougEBR (12-26-2019)
Old 12-05-2019, 06:51 PM   #3
Pro
 
sunkist's Avatar
 
Trade: builder fl cbc
Join Date: Apr 2012
Location: bradenton fl
Posts: 3,069
Rewards Points: 890

Re: How Much Do You Mark Up A Subcontractor's Work?


Depends on the job cost I use a sliding scale.
Just make sure it's worth your time to deal with the sub
The other thing is the subs work it's self how much hand holding or supervision is needed
__________________
Still "Shakin" the tree boss
sunkist is offline  
The Following User Says Thank You to sunkist For This Useful Post:
TheConstruct (12-05-2019)
Sponsored Links
Advertisement
 
Old 12-05-2019, 08:01 PM   #4
Pro
 
DaVinciRemodel's Avatar
 
Trade: Design/Build Remodeler
Join Date: Oct 2009
Location: Denver
Posts: 6,281
Rewards Points: 30

Re: How Much Do You Mark Up A Subcontractor's Work?


Most times, we pass a subs bill through without any mark-up (weíre usually T&M and make our nut on our time).

There are times weíre fixed price. Sometimes Iíll hit a subís bill by as little as 15%. Iíve also hit some by as much as 100%.

Iíve got no hard rules. Sometimes it depends on the customer, my mood, flip of the coin...
__________________
I love what I do and I'm very good at it!

Da Vinci on the web or Da Vinci On Facebook
DaVinciRemodel is online now  
The Following 4 Users Say Thank You to DaVinciRemodel For This Useful Post:
Calidecks (12-12-2019), DougEBR (12-26-2019), griz (12-05-2019), Jaws (12-05-2019)
Old 12-05-2019, 08:27 PM   #5
PCI
 
PCI's Avatar
 
Trade: contractor
Join Date: Jun 2012
Location: MN
Posts: 649
Rewards Points: 848

Re: How Much Do You Mark Up A Subcontractor's Work?


I'm like DaV, I'll mark it up 100% on some subs on some projects or I'll throw on a "necessary " dollar amount I need to make it worth my while for the project.

I could say I don't mark any of them up and tack on what I need to make for a project. When going through the numbers, I usually tack on a smaller % and add what I need to make in case I under estimate costs.
PCI is offline  
Old 12-05-2019, 09:42 PM   #6
Design/Build
 
NJ Contractor's Avatar
 
Trade: General Contractor
Join Date: Nov 2016
Location: New Jersey
Posts: 1,123
Rewards Points: 1,376

Re: How Much Do You Mark Up A Subcontractor's Work?


All job costs including subs are marked up 50%. We don't baby-sit for free...

Last edited by NJ Contractor; 12-05-2019 at 09:58 PM.
NJ Contractor is offline  
The Following 2 Users Say Thank You to NJ Contractor For This Useful Post:
Jaws (12-05-2019), odleo (12-06-2019)
Old 12-05-2019, 10:03 PM   #7
diplomat
 
Golden view's Avatar
 
Trade: Yeah, well, that's just, like, your opinion, man
Join Date: Feb 2012
Location: PDX
Posts: 5,292
Rewards Points: 1,550

Re: How Much Do You Mark Up A Subcontractor's Work?


Quote:
Originally Posted by NJ Contractor View Post
All job costs including subs are marked up 50%. We don't baby-sit for free...
Man I'd have made an extra million if I could mark up that much.
__________________
You make something idiot proof and the world invents a better idiot.
Golden view is offline  
The Following User Says Thank You to Golden view For This Useful Post:
NJ Contractor (12-06-2019)
Old 12-05-2019, 10:05 PM   #8
diplomat
 
Golden view's Avatar
 
Trade: Yeah, well, that's just, like, your opinion, man
Join Date: Feb 2012
Location: PDX
Posts: 5,292
Rewards Points: 1,550

Re: How Much Do You Mark Up A Subcontractor's Work?


For me it depends how much management there is, how much my experience, expertise, and reputation contributes to the performance of the sub's work. Some of the best subs aren't available direct to homeowners
__________________
You make something idiot proof and the world invents a better idiot.
Golden view is offline  
The Following User Says Thank You to Golden view For This Useful Post:
SmallTownGuy (12-11-2019)
Old 12-06-2019, 09:02 AM   #9
Design/Build
 
NJ Contractor's Avatar
 
Trade: General Contractor
Join Date: Nov 2016
Location: New Jersey
Posts: 1,123
Rewards Points: 1,376

Re: How Much Do You Mark Up A Subcontractor's Work?


Quote:
Originally Posted by Golden view View Post
Man I'd have made an extra million if I could mark up that much.
Sometimes it is still not enough for all the aggravation and incidentals that arise...
NJ Contractor is offline  
Old 12-06-2019, 09:35 AM   #10
diplomat
 
Golden view's Avatar
 
Trade: Yeah, well, that's just, like, your opinion, man
Join Date: Feb 2012
Location: PDX
Posts: 5,292
Rewards Points: 1,550

Re: How Much Do You Mark Up A Subcontractor's Work?


Quote:
Originally Posted by NJ Contractor View Post
Sometimes it is still not enough for all the aggravation and incidentals that arise...
Maybe my way's better then.

Smaller markup, great subs!
__________________
You make something idiot proof and the world invents a better idiot.
Golden view is offline  
Old 12-06-2019, 09:50 AM   #11
water re-locater
 
NYgutterguy's Avatar
 
Trade: Gutter installer
Join Date: Mar 2014
Location: orange/rockland ny NYC suburbs
Posts: 7,511
Rewards Points: 1,512

Re: How Much Do You Mark Up A Subcontractor's Work?


I hope guys jack up their cost to the homeowner as much as they can from my total.


Sent from my iPhone using Tapatalk
NYgutterguy is offline  
Old 12-06-2019, 10:22 AM   #12
Design/Build
 
NJ Contractor's Avatar
 
Trade: General Contractor
Join Date: Nov 2016
Location: New Jersey
Posts: 1,123
Rewards Points: 1,376

Re: How Much Do You Mark Up A Subcontractor's Work?


Quote:
Originally Posted by Golden view View Post
Maybe my way's better then.

Smaller markup, great subs!
Subs are good, houses are old, clients - well they run the gamut
NJ Contractor is offline  
Old 12-06-2019, 10:28 AM   #13
Design/Build
 
NJ Contractor's Avatar
 
Trade: General Contractor
Join Date: Nov 2016
Location: New Jersey
Posts: 1,123
Rewards Points: 1,376

Re: How Much Do You Mark Up A Subcontractor's Work?


Quote:
Originally Posted by NYgutterguy View Post
I hope guys jack up their cost to the homeowner as much as they can from my total.
Like salesmen who pay their own commissions
NJ Contractor is offline  
The Following 3 Users Say Thank You to NJ Contractor For This Useful Post:
Jaws (12-12-2019), Metro M & L (12-06-2019), NYgutterguy (12-06-2019)
Old 12-11-2019, 06:35 PM   #14
Pro
 
GCTony's Avatar
 
Trade: GC
Join Date: Oct 2012
Location: Virginia
Posts: 395
Rewards Points: 506

Re: How Much Do You Mark Up A Subcontractor's Work?


Quote:
Originally Posted by NJ Contractor View Post
All job costs including subs are marked up 50%. We don't baby-sit for free...
If only i could mark up 50% on top of my electricians contract, $185,000 along with the other subs $600K, I would only need to do one job a year.

We don't mark up subcontracted work. However we have fees stipulated like supervision, project management, project overhead, project profit that covers the baby-sitting part. For our public contracts we can only mark up 5% max on change orders for subcontracted work and we usually can't line item general condition type costs.
GCTony is offline  
Old 12-11-2019, 07:28 PM   #15
Design/Build
 
NJ Contractor's Avatar
 
Trade: General Contractor
Join Date: Nov 2016
Location: New Jersey
Posts: 1,123
Rewards Points: 1,376

Re: How Much Do You Mark Up A Subcontractor's Work?


Quote:
Originally Posted by GCTony View Post
We don't mark up subcontracted work. However we have fees stipulated like supervision, project management, project overhead, project profit that covers the baby-sitting part.
That is what my markup covers (overhead & profit) and a contingency for old house remodeling...never know what we are going to run into and I don't like to nickel and dime my clients to death while we are working, so we just keep moving.
NJ Contractor is offline  
Old 12-12-2019, 12:54 AM   #16
Pro
 
Stunt Carpenter's Avatar
 
Trade: Carpentry
Join Date: Dec 2011
Location: Airdrie
Posts: 2,169
Rewards Points: 3,246

Re: How Much Do You Mark Up A Subcontractor's Work?


Quote:
Originally Posted by NJ Contractor View Post
That is what my markup covers (overhead & profit) and a contingency for old house remodeling...never know what we are going to run into and I don't like to nickel and dime my clients to death while we are working, so we just keep moving.


I take a similar approach. There should be some buffer on subs work just in case there are slight problems. I canít get anywhere near 50% ok subs Iím 15-20% except my drywall guy is 25% because he needs more baby sitting and is a talker.
__________________
https://builddaley.com/
Stunt Carpenter is online now  
Old 12-12-2019, 01:59 AM   #17
Pro
 
Fouthgeneration's Avatar
 
Trade: Masonry
Join Date: Jan 2014
Location: Middle
Posts: 2,733
Rewards Points: 9,947

Re: How Much Do You Mark Up A Subcontractor's Work?


Any GC that is adding 50-100% is just teaching Subs to be General contractors to get a "fair" piece of Pie...

I'd get an outside opinion re: if your subs are truly subs regarding the IRS...

100 % markup = RED FLAG

The Federal IRS actually has an easy to understand test regarding Subs Vs. employees you need to be withholding taxes and paying mandate hourly payroll premiums like WC, etc..FCIA FUTA....

I hope the OPers Subs plow them under with = quality work at 75% cost levels.....

Can't see it ever withstanding a true 'Free' marketplace of GC's and Subs with informational transparency..... : If my GC marked my bills up 100% I'd under bidding them next month ......

Only in a Gold rush situation would margins like that make sense, Are you in some Nanny State with Huge barriers to getting G C licences? Or in a Mobbed up area like NYC?
__________________
I might be an Idiot, but I know things that You don't: Please wait till after you get my know-how to insult me....

Last edited by Fouthgeneration; 12-12-2019 at 02:05 AM.
Fouthgeneration is offline  
Old 12-12-2019, 06:29 AM   #18
Design/Build
 
NJ Contractor's Avatar
 
Trade: General Contractor
Join Date: Nov 2016
Location: New Jersey
Posts: 1,123
Rewards Points: 1,376

Re: How Much Do You Mark Up A Subcontractor's Work?


Quote:
Originally Posted by Fouthgeneration View Post
Any GC that is adding 50-100% is just teaching Subs to be General contractors to get a "fair" piece of Pie...

I'd get an outside opinion re: if your subs are truly subs regarding the IRS...

100 % markup = RED FLAG

The Federal IRS actually has an easy to understand test regarding Subs Vs. employees you need to be withholding taxes and paying mandate hourly payroll premiums like WC, etc..FCIA FUTA....

I hope the OPers Subs plow them under with = quality work at 75% cost levels.....

Can't see it ever withstanding a true 'Free' marketplace of GC's and Subs with informational transparency..... : If my GC marked my bills up 100% I'd under bidding them next month ......

Only in a Gold rush situation would margins like that make sense, Are you in some Nanny State with Huge barriers to getting G C licences? Or in a Mobbed up area like NYC?
huh??

It's a free market and a contractor can markup a project any amount that the market will bear. All projects should be estimated using fully burdened in-house labor costs + materials costs + subcontractor costs. Then one should add either a fixed cost or markup to cover overhead & profit. I am not sure what employee vs. sub has to do with our discussion as that is a different issue.
NJ Contractor is offline  
The Following 3 Users Say Thank You to NJ Contractor For This Useful Post:
402joel (12-13-2019), DaVinciRemodel (12-12-2019), Jaws (12-12-2019)
Old 12-12-2019, 11:48 AM   #19
The Sheriff
 
Jaws's Avatar
 
Trade: Builder
Join Date: Dec 2010
Location: Texas
Posts: 25,755
Rewards Points: 228

Re: How Much Do You Mark Up A Subcontractor's Work?


Quote:
Originally Posted by Fouthgeneration View Post
Any GC that is adding 50-100% is just teaching Subs to be General contractors to get a "fair" piece of Pie...

I'd get an outside opinion re: if your subs are truly subs regarding the IRS...

100 % markup = RED FLAG

The Federal IRS actually has an easy to understand test regarding Subs Vs. employees you need to be withholding taxes and paying mandate hourly payroll premiums like WC, etc..FCIA FUTA....

I hope the OPers Subs plow them under with = quality work at 75% cost levels.....

Can't see it ever withstanding a true 'Free' marketplace of GC's and Subs with informational transparency..... : If my GC marked my bills up 100% I'd under bidding them next month ......

Only in a Gold rush situation would margins like that make sense, Are you in some Nanny State with Huge barriers to getting G C licences? Or in a Mobbed up area like NYC?
Remodeling magazine recommends 40-67% mark ups on renovations.

I cant imagine foing a bathroom for less than 50% mark up, too much involved in a small (under 50k ) dollar amount

I expect a 28-30% gpm from renovations, including whole house Reno's. Mine isnt straight mark up unfortunately- Mine is more like 18-40% mark up depending on new construction or remodel, how big, etc..., so 15.38% gpm to 28.57% gpm, plus I make a modest GP on my inhouse employees (i.e I pay 25.00, their burden in 11 and I charge 45.00, so we gross 9 past employee burden), I make money on anything built in the shop, trash (I won my own dumpsters), I charge for supervision, design, selections manager etc... so it brings it up to as high as 40% gpm, and as low as 23% gpm on big stuff

You must also keep in mind that models are different. A gc with no inhouse personell doesnt need to get the same gpm as an outfit taking more risk, doing more work and keeping it in house like I am. Doesnt mean I net more, a good year 10-11%, a bad year 4%.... after a reasonable salary. I am paying for a shop, office, office staff, 9 trucks, equipment, a dozen employees or more etc.. vs that one man shop

It's a mistake to think you are hiring cheap subs with my model. My Mason is a millionaire most likely in his 30s, he gets 10 bucks a foot for limestone and 8.25 for full 1 1/8 stucco. Hes not cheap for this area by any means. I think many of my subs have a much better deal than me and less time invested in many cases. My AC contractor makes 20k a month probably with 2 crews and works about half a day. His overhead is lower, and he has one trade to know

I expect to be in the top 5% of my market for pricing
__________________
"If I have wounds I have two choices, See myself as a victim or see myself as a warrior"

Cheif Joseph
Jaws is online now  
The Following 3 Users Say Thank You to Jaws For This Useful Post:
402joel (12-13-2019), Calidecks (12-12-2019), NJ Contractor (12-12-2019)
Old 12-12-2019, 12:00 PM   #20
The Sheriff
 
Jaws's Avatar
 
Trade: Builder
Join Date: Dec 2010
Location: Texas
Posts: 25,755
Rewards Points: 228

Re: How Much Do You Mark Up A Subcontractor's Work?


Btw I'm in texas. My 9 year old could throw a sign on her bike and say I'm a builder lol

Advertisement

__________________
"If I have wounds I have two choices, See myself as a victim or see myself as a warrior"

Cheif Joseph
Jaws is online now  



Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Join Now... It's Fast and FREE!

I am a professional contractor
I am a DIY Homeowner
Drywall Talk is for
PROFESSIONAL CONTRACTORS ONLY!

At DrywallTalk.com we cater exlusivly to professional contractors who make their living as a contractor. Knowing that many homeowners and DIYers are looking for a community to call home, we've created www.DIYChatroom.com DIY Chatroom is full of helpful advices and perfect for DIY homeowners.

Redirecing in 10 seconds
No Thanks
terms of service

Already Have an Account?