Methodology

MarginWorkshop runs on plain contractor accounting math, the same markup, margin, and loaded-cost relationships a good estimator already carries in their head, worked out consistently instead of on the back of an invoice. This page explains where that math comes from and where it stops.

Standard formulas, not invented heuristics

Markup-to-margin conversion, loaded labor cost, billable rate, and job-profit math follow the same relationships taught in any contractor accounting or estimating reference, not a proprietary scoring model. If two contractors did the arithmetic by hand from the same inputs, they'd land on the same answer MarginWorkshop gives. Where a trade-specific engine (HVAC dispatch pricing, seasonal capacity) layers on top of that base math, the extra logic is stated on the engine's own page alongside the formula.

Where the defaults come from

Figures like typical labor burden percentages or healthy margin bands are shown as ranges, not single invented numbers, and every range is labeled as general industry pattern rather than your actual cost structure. An engine never presents a default as if it were measured from your business. Override any of them the moment you know your real number, doing so changes the result immediately.

What a result assumes

A result only reflects what you typed in or accepted as a default. It does not know your local labor market, a specific customer's price sensitivity, or your crew's actual pace on a given day. Where that gap matters for a particular engine, the engine's own page says so directly rather than staying silent about it.

What's deliberately out of scope

No engine models tax treatment, entity structure, licensing, bonding, or insurance coverage. Those questions route to a licensed professional, not a formula. See the disclaimer for the full list of what these tools don't do, and privacy for how your inputs are (and aren't) stored.