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When providing fixtures on a commercial project what would you guys say is a fair and acceptable mark up for fixtures? For both the customer and me. I just am finishing up a small commercial remodel and now has come the time to put a mark up on my fixtures. I don't want to short myself but still be fair. Let me repeat I don't want to short myself. This project is T&M and since it was a remodel and the scope of work is pretty fluid I did not give them a price in the beginning. For my Resi customers I general have them pick out and purchase their own fixtures (other than recess lights and under cabinet lighting) so I don't run into this with them. In the past I feel like I have not charged enough for commercial fixtures for my commercial customers so this is why I am seeking your opinions and direction.
 

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When providing fixtures on a commercial project what would you guys say is a fair and acceptable mark up for fixtures? For both the customer and me. I just am finishing up a small commercial remodel and now has come the time to put a mark up on my fixtures. I don't want to short myself but still be fair. Let me repeat I don't want to short myself. This project is T&M and since it was a remodel and the scope of work is pretty fluid I did not give them a price in the beginning. For my Resi customers I general have them pick out and purchase their own fixtures (other than recess lights and under cabinet lighting) so I don't run into this with them. In the past I feel like I have not charged enough for commercial fixtures for my commercial customers so this is why I am seeking your opinions and direction.
Here is a good table to work with.


By MDSHUNK


Actual Cost x Multiplier = Cost of item to customer
$0.00 to $0.49 x 6
$0.50 to $0.99 x 5.75
$1.00 to $1.49 x 5.5
$1.50 to $1.99 x 5.25
$2.00 to $2.49 x 5
$2.50 to $2.99 x 4.75
$3.00 to $3.99 x 4.5
$4.00 to $4.99 x 4.375
$5.00 to $5.99 x 4.25
$6.00 to $6.99 x 4.125
$7.00 to $7.99 x 4
$8.00 to $8.99 x 3.75
$9.00 to $9.99 x 3.625
$10.00 to $19.99 x 3.5
$20.00 to $29.99 x 3.375
$30.00 to $39.99 x 3.25
$40.00 to $49.99 x 3.125
$50.00 to $59.99 x 3
$60.00 to $69.99 x 2.75
$70.00 to $79.99 x 2.625
$80.00 to $89.99 x 2.5
$90.00 to $99.99 x 2.333
$100.00 to $139.99 x 2.25
$140.00 to $169.99 x 2.166
$170.00 to $199.99 x 2
$200.00 to $239.99 x 1.855
$240.00 to $269.99 x 1.823
$270.00 to $299.99 x 1.789
$300.00 to $349.99 x 1.75
$350.00 to $399.99 x 1.725
$400.00 to $499.99 x 1.6875
$500.00 to $749.99 x 1.6
$750.00 to $999.99 x 1.55
$1,000.00 to $1,499.99 x 1.5
$1,500.00 to $1,999.99 x 1.45
$2,000.00 to $2,999.99 x 1.4
$3,000.00 to $4,999.99 x 1.35
$5,000.00 to $9,999.99 x 1.3375
$10,000.00 to $24,999.99 x 1.3333
$25,000.00 to $49,999.99 x 1.33
$50,000.00 to $99,999.99 x 1.3
 

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I typically markup fixtures and high dollar gear 5% would be $100 /.95 = 105.63 if I remember correctly.
I would calculate per piece for install $100 for example. You might be $1 others might be $200 per installed unit.
That's the art of our science.
 

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Your markup should be whatever the market will bear. However, if you grow into bidding larger commercial work, you may find that the market will not bear as much.

The standard markup scheme is 2 level; Overhead and Profit. If you are not familiar with overhead, it is the cost to keep you office open, including office employees, business machines, office supplies, insurance, rent, etc. Take your last years sales and calculate the ratio as a percentage of your total expenses. for most small contractors working out of their homes, it is about 7%. The 2nd markup, profit, covers your paycheck, and putting cash back into your company. Only you can determine what the profit markup needs to be. It is very common to see markups of 10% and 5% in the most competitive of bids. Here is an example. Add up all of you costs, including material, labor, rentals, permits, etc. This is your prime cost. Let's say it came up to $50,000

Prime Cost $50,000
Overhead @ 10% 5,000
Subtotal 55,000
Profit @ 5% 2,750
Total 57,750

To recap, these are the types of markups I am seeing in mid to large projects. However, your markups should be whatever you can get without alienating the customer.
 

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Discussion Starter · #8 · (Edited)
Your markup should be whatever the market will bear. However, if you grow into bidding larger commercial work, you may find that the market will not bear as much.

The standard markup scheme is 2 level; Overhead and Profit. If you are not familiar with overhead, it is the cost to keep you office open, including office employees, business machines, office supplies, insurance, rent, etc. Take your last years sales and calculate the ratio as a percentage of your total expenses. for most small contractors working out of their homes, it is about 7%. The 2nd markup, profit, covers your paycheck, and putting cash back into your company. Only you can determine what the profit markup needs to be. It is very common to see markups of 10% and 5% in the most competitive of bids. Here is an example. Add up all of you costs, including material, labor, rentals, permits, etc. This is your prime cost. Let's say it came up to $50,000

Prime Cost $50,000
Overhead @ 10% 5,000
Subtotal 55,000
Profit @ 5% 2,750
Total 57,750

To recap, these are the types of markups I am seeing in mid to large projects. However, your markups should be whatever you can get without alienating the customer.
Thanks for your response and your explanation but what I was asking for is was just an example of mark-up on fixtures for a small T&M commercial remodel. Please give me an idea of just a straight markup for about a $1000.00 worth of fixtures. Remember I warranty them, handle them, ordered them, stored them, transported them, made sure they came intact and complete, ect. I just don't want to short myself. I looked on the internet to see what they show for on line and that was anywhere from 50 to 200 percent more that what I paid for them thru my supply house. I mean is charging those percentages standard industry practice?
 

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The point of mark up is to cover all those costs. Add up your costs and add in a buffer and whatever that percentage is, is what it is. It could be 10%, it could be 50%, it could be 200%.
 
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