# Markups and Margins

Markup is the difference between the contract price of a product and its cost (excluding GST or VAT). It is expressed as a percentage above the cost or a fixed number above the costs.

Markup is the contract price minus the costs.

In other words, markup is the amount you add to the cost to get to the selling price (ex GST).

### Examples of markups

Let’s suppose the cost to build a house is \$300,000. To calculate the contract price, you add some markups to the cost like:

• Profit (15%): \$45,000
• Sales Commission (8%): \$24,000
• Contingency (1.5%): \$4,500

Total markups would be: \$79,500

GST (or VAT) will be on top of the costs and markups: (\$300,000 + \$79,500) * 10% = \$37,950

So, the contract price can be calculated as Costs + Markups + GST = \$300,000 + \$79,500 + \$37,950 = \$417,450

### Markups in Breinz

Doing the above math in Breinz is easy. You just need to add any markup you think you want to add on top of your costs in Markup tab.

Go to Projects page, select the project, select the costing you want to add margins for, and click on Markups tab.

2. Copy all markups to use in a different costing.
3. Paste copied markups.
4. Delete all markups.
5. Edit an existing markup
6. Switch on/off a markup to check it's effect on the price.
7. Markup value: Markup percentage * Total costs

1. Click on the plus button to add a new markup
2. Give the new markup a name, like Profit.
3. Select the type: a markup can be a fixed figure you want to add on top of the costs, like \$50,000, or a percentage of the costs.
4. Type the amount of the markup