Markup and margin can sit at the same table and still tell you different things. Mix them up and a quote can look healthier than it really is.
Markup starts with cost
If something costs you $100 and you add a 25% markup, you add $25. The selling price becomes $125.
Margin starts with the selling price
On that same $125 sale with a $100 cost, the gross profit is $25. The gross margin is $25 divided by $125, which is 20%.
So a 25% markup produced a 20% gross margin. Same job. Same dollars. Different percentage.
Why tradies should care
If you decide what you need based on margin but price the job as though the same percentage were markup, the result will not match your target. That gap gets particularly noticeable as the percentages grow.
Use the right number for the question
Markup asks how much you added relative to cost. Gross margin asks what share of the selling price remains after the costs included in your calculation. Neither number magically tells you final business profit; overheads and other expenses still exist.
MarginForge calculates estimated gross profit and margin from the costs and selling prices you enter, then lets you compare actual job costs. Your accounting and tax treatment should still be checked with an appropriately qualified professional where needed.