Passing material straight through at cost price costs you money: ordering effort, transport to the job site, storage, waste and warranty aren't covered by that. A markup on the material price makes up for it.
Formula: Sale price = material costs + (material costs × markup ÷ 100)
Example calculation
| Item | Amount |
|---|---|
| Material costs (purchase) | €250 |
| Markup | 20% |
| Sale price | €300 |
Markup amount: €250 × 20% = €50. Sale price: €250 + €50 = €300.
In Germany, material markups in the trades are common practice and legally unproblematic, as long as they're not hidden but shown transparently on the quote or invoice.
