Section Markups are added to a bid after Indirect Expenses are applied. Section Markups and Indirect Expenses are applied based on the information entered under Default Markups and Indirect Expenses.
Section Markups refer to Overhead, Profit, Tax, Burden and Escalation applied to each section used in the bid. Section Markups can be calculated by two methods in Quick Bid: Straight or Gross Margin.
Overhead refers to general operating expenses. Overhead is applied as a percentage to your total costs (material, labor, indirect costs, sales tax and labor burden). You may prefer to include Overhead in your Profit line, thus no entry would be made in the Overhead field. Overhead is considered part of your cost and is marked up with profit.
Profit can be entered as a percentage of profit you want to apply to material, labor, equipment, and other costs. Profit is applied to the Overhead cumulatively. On the Markup Detail dialog, there are controls adjacent to the Indirect Costs buttons (stock, clean, etc.) that turn off the Overhead and Profit for each of these expenses.
Tax/Burden, Tax refers to sales tax on material while Burden refers to taxes, fees, and insurance on labor. Tax and Burden can be changed directly in the Markup Detail dialog on Material, Equipment and Other. Since Burden is usually calculated based on Payroll Settings, you must specify a Labor Override in order to adjust burden from the Markups tab. If you prefer, you can make all adjustments to burden on the Payroll tab. See Adjusting Bid Level Markups for more information.
Escalation is a global modifier for costs associated with material, labor, equipment, and others and is job specific. Escalation is expressed as a percentage and may be entered as a positive or negative value. Sales taxes are applied to escalation values that are assigned to materials. However, Labor Burden is not applied to Labor Escalation. Overhead and Profit can be applied to escalation. Escalation is an added cost to your bid and does not change unit cost pricing at the Condition Detail dialog. It will, however, affect the selling price of each condition.
Section markups can be calculated by two methods in Quick Bid: Straight or Gross Margin.
Straight Markup multiplies cost by a set percentage. Cost (100%+X%) = Total
Gross Margin Markup
takes bid cost and divides it by the remainder of 1 minus the markup percentage.
Cost / (1-GM%)
= Total
You can also adjust Section Markups at the bid level from the Markups tab. The next section explain how.
Markup calculation method is set in Tools > Options, New Bid tab and/or on the Cover Sheet.
Anytime you Select all bid sections you will be viewing and updating all sections in the current bid. Changes made on the Markups Details will overwrite 'per-section' Markups. If you are in Section Mode (default option), updates will only be made to that one section.