Materials Cost
What you pay your supplier, excluding VAT.
Standard trade markup is 10–25%. Higher for specialist or sourced-to-order materials.
Order 10% extra for cuts/breakage. Tiling typically needs 10–15% more.
Sourcing & Delivery
Travel to merchant, waiting, loading. Be honest — small jobs are often 1–2 hrs.
What your time is worth. Use the Hourly Rate Calculator if unsure.
Supplier delivery charge, fuel for collection run, parking.
Job & VAT Settings
Special orders carry higher risk — add an extra risk premium.
Enter to see the annual impact of your markup strategy.
Why you should always mark up materials
Supplying materials isn't free — it takes your time, your fuel, your vehicle, and you carry the risk. If you order the wrong thing, get short-delivered, or need to return items, that cost is on you. Charging the customer the exact trade price you paid means you're absorbing all that risk for zero reward.
A materials markup of 10–25% is standard across UK trades. It compensates you for your time, covers the risk, and is entirely normal — customers expect it.
Markup vs margin — what's the difference?
| Metric | Formula | Example (£100 cost) |
|---|---|---|
| 25% markup | Cost × 1.25 | £100 → £125 to customer |
| 25% margin | Cost ÷ 0.75 | £100 → £133 to customer |
| 33% markup | Cost × 1.33 | £100 → £133 to customer |
A 25% markup gives you a 20% margin. A 25% margin requires a 33% markup. Many tradespeople mix up the two — clarify which you mean when discussing with clients or colleagues.
Typical materials markup by trade (UK 2025)
| Trade | Typical Markup | Notes |
|---|---|---|
| Plumber | 15–25% | Higher on specialist parts and fittings |
| Electrician | 15–25% | Consumer units, cables, accessories |
| Builder | 10–20% | High-volume orders, tighter margins |
| Plasterer | 10–20% | Bags of plaster, beads, tape |
| Tiler | 15–25% | Higher wastage needed — price in extra tiles |
| Painter & Decorator | 15–25% | Paint, fillers, brushes |
| Carpenter / Joiner | 15–25% | Timber, sheet goods, fixings |
| Gas Engineer | 20–35% | Boiler parts, specialist components |
| Kitchen / Bathroom Fitter | 10–20% | Often customer supplies the units |
Always include wastage
When you order materials, you need more than the exact amount. Tiles break, timber gets cut, paint overlaps, and fittings get damaged. The industry standard is to order 10–15% extra to account for this.
That wastage is a real cost you paid for — include it in what you charge the customer. A 10% wastage allowance on £200 of tiles means you ordered £220 of tiles; the customer should pay for £220 (plus your markup).
Charging for sourcing time
Getting materials takes time. A trip to the builder's merchant might take an hour and a half: 30 minutes driving each way, loading, waiting. At £45/hour, that's £67.50 of your time on admin.
You have two options:
- Fold it into your markup — this calculator does this by adding the sourcing time cost before calculating the markup
- Charge explicitly — some tradespeople add a separate "materials collection" charge on the invoice
Either is valid. The key point: don't absorb it. Your time has a cost.
VAT and materials
If you are VAT registered, you collect VAT on the full invoice (labour + materials) at 20%, then pay that VAT to HMRC minus any VAT you reclaimed on your own purchases. Most building work is standard-rated at 20%, though some work (new builds, certain renovations) may qualify for reduced or zero rates.
If you are not VAT registered, you simply don't charge VAT on anything. Never add VAT to an invoice if you're not registered — it's illegal.
What about customer-supplied materials?
When a customer supplies their own materials, you lose the materials profit and take on extra risk:
- Wrong spec, wrong size — they'll expect you to make it work
- Inferior quality — your workmanship gets blamed if it fails
- Delays if they haven't ordered yet or ordered incorrectly
Many tradespeople charge a 10–15% surcharge when fitting customer-supplied materials to compensate for the additional risk. At minimum, make it clear in writing that you cannot warranty work using their materials.
Frequently asked questions
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How much should a tradesperson mark up materials?Most UK tradespeople add 10–25% on top of their materials cost. The right figure depends on the trade, order size, sourcing effort, and risk. Small orders with specialist sourcing warrant higher markups (20–30%). Large bulk commodity orders typically carry 10–15%. Never supply materials at cost — you carry risk and spend time on sourcing.
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Is it legal to mark up materials?Yes, absolutely. There is no law requiring you to pass materials on at cost. You are running a business and marking up materials is standard commercial practice. The key is to be transparent — if a customer asks to see receipts, you can choose whether to share them, but you're under no legal obligation to do so.
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What is the difference between markup and margin?Markup is calculated on cost (25% markup on £100 = £125 selling price). Margin is calculated on revenue (25% margin on £125 = £31.25 profit). The same selling price has a different percentage depending on which you use. A 25% markup equals a 20% margin.
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Should I charge VAT on materials?Only if you are VAT registered. If you are, you charge VAT (usually 20%) on the full invoice including materials. If you are not VAT registered, do not add VAT to anything.
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What wastage allowance should I use for tiling?For standard tiles with straight cuts, 10% wastage is typical. For diagonal patterns, intricate shapes, or highly breakable tiles (natural stone, large format tiles), budget 15–20%. Always order enough — returning for a second batch risks colour variation between production batches.