What's a fair contractor markup?

Contractors mark up materials to cover the time spent sourcing, picking up, handling, and warrantying them — plus a little profit. 15–30% over their cost is standard across the industry.

A markup well above that range deserves a question about what it covers. You can sanity-check big-ticket materials yourself: a quick look at retail prices for cabinets, countertops, or fixtures gives you useful context for the conversation.

Labor isn't marked up the same way — it's priced at the going rate for skilled trades in your area, and that varies enormously by region:

• High-cost metros (NYC, SF, LA, Boston, Seattle): roughly $70–$130/hr
• Mid-tier metros (Denver, Austin, Atlanta, Phoenix): roughly $50–$80/hr
• Smaller cities and suburbs: roughly $40–$65/hr
• Rural / low-cost areas: roughly $30–$50/hr

If a quote implies a crew hourly rate well above your local market, that's a flag worth questioning.

On larger projects, a general contractor adds a fee for managing the job — scheduling subs, ordering materials, handling permits, and carrying the risk. 10–15% of the project total is typical. A fee well above that, especially as a separate line, is worth asking about — it should come with a clear explanation of what it covers.

A fair quote = materials at cost + a 15–30% materials markup + labor at local rates + a 10–15% GC fee. When you see each piece itemized and within those ranges, you can sign with confidence. When you can't see the pieces — or they're above range — it's time to ask questions.