Cabinet multiplier and markup: how to go from list price to what you charge
A cabinet dealer almost never sells at the number printed in the manufacturer's price book. The book gives a list price; your agreement gives a multiplier; the product of the two is what you pay. What you charge the homeowner is a second decision on top of that cost. Mixing the two up is how quotes lose money.
The three numbers
- List price: the price in the manufacturer's book for one SKU, such as a B24 base cabinet in a given door style.
- Multiplier: the fraction of list you pay. Your dealer agreement sets it, and it can differ by manufacturer or by door style line.
- Markup: the factor you apply to your cost to get the sale price. This one is yours.
Cost = list × multiplier. Sale price = cost × markup. Many dealers keep a separate rule for installation: labor is quoted on its own line, per linear foot or per unit, not hidden in the box price.
A worked example
The numbers below are made up to show the arithmetic, not a market benchmark.
| Step | Math | Result |
|---|---|---|
| List price | from the price book | $412.00 |
| Your cost | $412.00 × 0.42 | $173.04 |
| Sale price per box | $173.04 × 1.60 = $276.864, rounded to the cent | $276.86 |
| Six boxes | $276.86 × 6 | $1,661.16 |
| Margin per box | $276.86 − $173.04 = $103.82, divided by $276.86 | 37.5% |
Round each box to the cent first and multiply by the quantity after. That is how a dealer checks it on a calculator, and it keeps the quote and the order to the manufacturer on the same totals.
Markup is not margin
A 1.60 markup sounds like 60 percent profit. It is not: you keep $103.82 of a $276.86 sale, 37.5 percent. Margin is profit divided by the sale price; markup is profit divided by cost. To keep a target margin, the markup is 1 ÷ (1 − margin): 40 percent margin needs 1.667, 30 percent needs 1.429.
What a discount does
Your cost does not move when you give a discount, so the whole discount comes out of margin. Take 10 percent off the example: $276.86 becomes about $249.17 per box, you still pay $173.04, and the margin drops from 37.5 to about 30.6 percent. A builder who asks for 10 percent off is asking for a fifth of your margin. Decide a floor before the quote goes out.
Where the multiplier does not apply
- Modifications such as a finished end or a cut-down are added to the list price first and then multiplied, the way the manufacturer's tables are built.
- Labor, delivery and sales tax are not boxes. Labor is not multiplied; whether it is taxed depends on your state.
- Lines with no multiplier on file should show cost as unknown, not as list. A guessed margin is worse than a blank.
How Cabinet Project handles it
You set a default multiplier for the company and override it per manufacturer or per line; the most specific one wins. Each box on a quote is priced as list × multiplier × your markup, rounded per unit. If you sell at list instead, leave the markup empty. When a box has no multiplier, the quote shows a "Set multiplier" link in place of a margin, so you never read $0.00 as profit. Discounts are subtracted from margin, not just from the total. Try the numbers on your own SKUs in the cabinet cost calculator, then see cabinet quoting software or walk through quoting a 10x10 kitchen.
Questions
What is a cabinet dealer multiplier?
A number your manufacturer gives you that turns the printed list price into your cost. A multiplier of 0.42 means you pay 42 percent of list. Each dealer agreement sets its own, and it can differ by door style line.
What is the difference between markup and margin?
Markup is applied to your cost; margin is the share of the sale price you keep. A 1.60 markup (cost × 1.60) leaves a 37.5 percent margin, not 60 percent. To keep a 40 percent margin you need a markup of 1.667.
Should I sell at list price?
Only if that is what your market bears. Selling at list with a 0.42 multiplier leaves a 58 percent margin, but homeowners compare against big-box quotes. Many dealers mark up their cost instead and let the list price stay a reference.
Does a discount come off my margin?
Yes, all of it. A 10 percent discount on a quote does not shrink your cost, so it comes out of what you keep: in the example below, margin falls from 37.5 percent to about 30.6 percent.