Contractor Overhead and Profit Calculator

GMP contracts stack O&P on top of direct hard costs. Overhead covers home office, estimating, project management. Profit is the contractor's margin. Bond and builders risk are common adders. This calculator sums them to reach total contract value and reports effective markup.

Direct hard cost (subs + materials)

General overhead %

Profit %

Bond %

Builders risk insurance %

GMP contract value

$5,197,500

General overhead $

$360,000

Profit $

$270,000

Performance bond $

$45,000

Builders risk insurance $

$22,500

Total O&P markup on hard cost

15.50%

Markup as % of GMP

13.42%

How the math works

Contractor O&P = general overhead (home office, estimating, project management) + profit. Typical: OH 6-10%, profit 4-8%. Smaller contractors have higher OH (less volume absorbs home office). Fast-track commercial projects push profit higher due to schedule pressure.

Performance bond and builders risk insurance are typically 1-1.5% combined. Some owners require them; others self-insure for cost savings on smaller projects.

How to Use

Enter direct hard cost (subs + materials).
Enter overhead and profit percentages.
Enter bond and builders risk insurance percentages.
Read total GMP and markup breakdowns.

Frequently Asked Questions

OH vs profit — what's the difference?

Overhead is recoverable cost of running the business — home office salaries, insurance, vehicles. Profit is margin above all costs. Combined O&P is typically 12-18% of hard cost on commercial projects.

When is bond required?

Public work almost always requires performance bond. Private work depends on owner/lender preferences. Bond cost 0.5-1.5% of contract value, charged through GC.

Cost-plus vs GMP?

Cost-plus = owner pays actual cost + fee. GMP = contract cap; contractor eats overruns above GMP. Most commercial work is GMP with shared-savings clauses for under-run.