Contractor Markups and the Wholesale Cost of Vinyl Siding.

Typical markups for contractor sold vinyl siding vary from no markup at all to 25% to 30% of their wholesale cost. Several factors determine how much, if any, contractor markups are added to the wholesale cost of vinyl siding they sell you.

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Contractors and Vinyl Siding Markups

Some contractors mark up the wholesale cost of vinyl siding they're installing on your home. Glenn Gossman of Gossman Construction in Arlington, Ohio, disagrees with the practice.

"I don't think it's right," said Mr. Gossman. "I hear other contractors talk about marking up materials as a way of making extra money."

Other contractors disagree. The national average for material markups is 27%. This means that most consumers rarely see the wholesale cost of vinyl siding. If there are cost overruns on the job, the money might be recovered by the contractor in additional markups on the materials.

Why Markups on Vinyl Siding?

Estimates are divided between the cost of materials and the cost of labor. If a siding contractor is going to make money and run a profitable business, he needs to cover these costs. When homeowners ask for an estimate on vinyl siding installation, the contractor is faced with additional costs that technically don't fall within these two parts of the estimate. These hidden costs to the contractor, and ultimately to the homeowner, include:

  • Ordering the vinyl siding
  • Picking up the siding
  • Delivering the siding to the job site
  • Down time to accomplish these tasks

Contractors try to make up the cost of phone calls, wear and tear on a delivery vehicle, gas costs, and down time by adding markups to the wholesale cost of vinyl siding. There is nothing dishonest about the markup, since they're recovering the cost of doing business - but this does explain the variability in quotes you may see from contractor to contractor.

Other contractors factor in these behind-the-scene costs by adding them into the labor. Either way, costs are passed along to the homeowner.

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