Fixed-Fee Project Quote Calculator
Turn an estimated project cost into a fixed fee at your margin or markup.
What this calculator does
The user chooses margin or markup and the calculator applies only that method, reporting both resulting percentages so the difference is visible.
Inputs and what they mean
- Currency
- — Amounts are shown in the currency you pick. No exchange rate is applied..
- Estimated project cost
- — number value.
- Contingency reserve (optional)
- — Optional component. Leave at 0 to exclude it from the result..
- Pricing method
- — Margin is a share of the price. Markup is an addition to cost. They are not the same number..
- Margin or markup
- — number value.
How to use it
- Enter your own figures — the calculator never fills in a rate, price or benchmark for you.
- Press Calculate to see the result.
- Read the formula, variables, assumptions and source below the result before you rely on it.
Formula
Cost with reserve = Cost × (1 + Contingency rate); Fee = Cost with reserve ÷ (1 − Margin) for a margin, or Cost with reserve × (1 + Markup) for a markup
Worked example
$62,000 of cost quoted at a 25% margin
The reserve is added to cost before the margin is applied.
Reading the result
The headline figure is the main answer. Any breakdown underneath shows the parts that make it up, so you can check the working and see what changes when you adjust an input.
Limitations and assumptions
Results depend entirely on the figures you enter and are rounded for display. They are for general information and education, not professional advice.
Reference: Rice University — Principles of Accounting, Volume 2: Managerial Accounting
Last reviewed:
Common questions
Formula, source and verification
Cost-plus pricing applied to a cost that already includes any contingency reserve, with margin and markup kept as separate methods.
The question it answers: What fixed fee should I quote for a project that costs us this much to deliver?
The formula
Cost with reserve = Cost × (1 + Contingency rate); Fee = Cost with reserve ÷ (1 − Margin) for a margin, or Cost with reserve × (1 + Markup) for a markup
- C — Estimated project cost
- (currency). Total cost of delivering the project.
- g — Contingency rate
- (%). Optional reserve added to cost before pricing.
- m — Margin
- (%). Share of the fee kept as profit.
- k — Markup
- (%). Percentage added to cost to reach the fee.
Units: Currency; percentages.
What kind of calculation this is
Business input model. The answer depends on business figures only you can supply, such as your own costs, rates or volumes. No market or benchmark values are assumed for you.
Method
The user chooses margin or markup and the calculator applies only that method, reporting both resulting percentages so the difference is visible.
Assumptions built into the result
- Mathematical: The cost entered is the full cost of delivery.
Figures this calculator will never guess for you
- No industry-average rate, margin, overhead or ticket volume is inserted.
- No optional component is filled in on the user's behalf.
- No default margin is applied and no fixed multiple of cost is used.
Limitations
- Shows the fee implied by the inputs; it does not say what a client will accept.
Source and version
- Standard or reference
- Cost accumulation, cost-plus pricing, margin and markup (OpenStax, Principles of Accounting Volume 2: Managerial Accounting — job order costing, cost-plus pricing, margin and markup.)
- Published source
- Rice University — OpenStax (CC BY)
- Formula version
- Version 1
- Verification
- Reviewed against the cited source on
- How much weight the source carries
- Academic
- Applies to
- Currency
- Amounts stay in the currency you choose; no exchange rate is applied.
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