This article was written by our expert who is surveying the industry and constantly updating the business plan for a kitchen design studio.
In October 2025, most kitchen design studios use clear, structured markups to cover product sourcing, installation, design time, and overhead.
Below you will find practical, current ranges for cabinetry, countertops, appliances, labor, and ancillary items, plus how brand position, suppliers, and market conditions influence your pricing.
If you want to dig deeper and learn more, you can download our business plan for a kitchen design studio. Also, before launching, get all the profit, revenue, and cost breakdowns you need for complete clarity with our kitchen design studio financial plan.
Kitchen design studios typically mark up cabinetry 30–40%, countertops 20–50%, and appliances 15–35%, with labor/installation often marked up 20–30% above direct cost. Gross profit margins usually target 30–50% overall, adjusted by supplier terms, brand positioning, and local market dynamics.
Custom projects command higher markups than RTA/semi-custom due to bespoke fabrication, complex installation, and premium materials; design fees usually represent 3–12% of the final price, charged as fixed, hourly, or bundled structures.
| Component | Typical Markup (Oct 2025) | What this means for a new kitchen design studio |
|---|---|---|
| Cabinetry | 30–40% | Higher for custom or branded lines; tighten discounts with vendors to protect margin on large runs. |
| Countertops | 20–50% | Material-driven: engineered stone and premium natural slabs support higher markups; fabrication risk must be priced in. |
| Appliances | 15–35% | Retail competition keeps markups lower; use package rebates and MDF/coop funds to preserve overall margin. |
| Labor & Installation | 20–30% over cost | Complex sites, permits, and specialist trades justify the top end (+35% in tough markets). |
| Ancillary items | 18–60% | Hardware, fixtures, and lighting carry strong perceived value; curate premium options to lift ASP and margin. |
| Design fees | 3–12% of project | Mix of flat fee, hourly, or bundled; set minimums to cover revisions and site coordination. |
| Gross margin target | 30–50% overall | Blend of product + labor + design must cover rent, salaries, marketing, and warranty reserves. |
What is the average markup for cabinetry, countertops, and appliances?
Studios commonly mark up cabinetry 30–40%, countertops 20–50%, and appliances 15–35%.
Cabinetry sits higher because brand, finish options, and configuration complexity add design value. Countertop markup depends on material and fabrication risk, while appliances face strong retail competition that caps pricing power.
Bundle pricing (cabinetry + tops + appliances) helps you protect blended margin even when one category is price-sensitive. Use vendor rebates and package deals to lift effective margin without raising list price.
Set category floor markups in your pricing policy and review quarterly so sales teams stay consistent.
This clear structure prevents margin leakage during discounts and change orders.
How does markup differ between custom kitchens and RTA/semi-custom?
Custom projects carry higher markups; RTA/semi-custom runs lower due to standardization.
Expect custom cabinetry at 30–45% markup and custom surfaces at the top of their ranges because design hours, jobsite risk, and premium materials increase value and liability. RTA/semi-custom lines typically sit near 15–25% on cabinets with simpler installation and fewer unknowns.
Position custom for clients seeking unique finishes, integrated accessories, and tailored ergonomics; reserve RTA/semi-custom for speed and budget control. Keep separate price books so teams can quote quickly without mixing rules.
We cover this exact topic in the kitchen design studio business plan.
Choose the pathway that best fits your client’s priorities and your capacity.
What is the typical markup on labor and installation?
Studios usually mark up labor and installation 20–30% over direct cost.
Complex builds, restricted-access sites, or premium finishes can justify 35%+ due to remeasures, protection, and coordination. Typical hourly install rates range broadly by region and skill (e.g., $30–$150), so codify rates and minimums.
Quote install separately with a scope matrix (demo, MEP coordination, templating, finish carpentry, punch list). Add a contingency line for unknowns tied to site conditions.
It’s a key part of what we outline in the kitchen design studio business plan.
Protecting install margin protects schedule and client satisfaction.
How do supplier relationships and bulk purchasing affect markup?
Better supplier terms lower your cost and let you maintain—or even increase—markup.
Volume tiers, rebate programs, and exclusive lines can add 3–8 points of effective margin without changing ticket price. Private-label or limited distribution products reduce price shopping and stabilize your mix.
Negotiate freight caps, damage allowances, and lead-time commitments; these reduce rework and warranty hits that erode margin. Track earned rebates monthly so finance recognizes true margin.
This is one of the strategies explained in our kitchen design studio business plan.
Procurement discipline is a profit center in a kitchen design studio.
How do brand positioning and target customers influence markup?
Premium positioning and affluent customer segments support higher markups.
Luxury-focused studios monetize exclusivity, design pedigree, and curated materials, pricing at the top end of each category’s range. Value-driven studios target volume and speed, using sharper markups but higher close rates.
Define your promise (craft, sustainability, speed, or price) and align sampling, showroom vignettes, and vendor list accordingly. This avoids mixed signals and discount-driven erosion.
Get expert guidance and actionable steps inside our kitchen design studio business plan.
Clarity of brand equals clarity of pricing.
How much higher is the markup on premium/luxury projects?
Premium kitchen projects often run 25–100% higher markup than mid-range equivalents.
Drivers include bespoke cabinetry, artisan finishes, integrated lighting, and complex stonework; clients are buying uniqueness and longevity. Installation risk and coordination time also increase, warranting stronger labor markups.
Present tiered packages (mid, premium, flagship) so clients self-select value levels while you preserve margin architecture. Document finish standards to control scope creep.
Use premium accessories and lighting to raise ASP with minimal additional labor.
This model improves profitability without aggressive discounting.
What gross profit margins do studios aim for, and how does this relate to markup?
Studios typically target 30–50% gross margin across the whole project.
Gross margin blends product markup, labor markup, and design fees; it must cover rent, salaries, marketing, vehicles, and warranty reserves. Markup is a tool to hit the gross margin target after cost of goods and direct labor.
Build a pricing waterfall showing list prices, discounts, costs, rebates, and net margin by category. Review job-costing monthly to catch slippage early.
Set a non-negotiable minimum margin per job and enforce approvals for exceptions.
Consistent discipline stabilizes cash flow and growth.
How do regional differences (rent, labor, competition) change markup?
Higher-cost, high-demand cities push markups to the top of the range; rural/competitive markets run leaner.
Big metros face higher rent, wages, and client expectations, which require stronger category markups and premium labor rates. Sparse markets with lower overhead can maintain target gross margins with gentler markups.
Track local competitors’ price posture and lead times; differentiate on service levels rather than only price. Adjust install rates for travel time and access constraints.
Regional calibration prevents margin shortfalls hidden inside overhead.
Update your price book twice a year to reflect local cost movements.
What share of the final price comes from design fees, and how is it structured?
Design fees usually represent 3–12% of the final project price.
Studios use fixed packages (concept to permit set), hourly billing with minimums, or bundled fees that credit back on purchase. Premium studios often separate design from product to signal expertise and protect the work even if the client delays buying.
Define deliverables by phase (concept, 3D, specs, site coordination) and cap revisions to control scope. Require deposits and milestone billing to fund time spent.
You’ll find detailed market insights in our kitchen design studio business plan, updated every quarter.
Clear fee structure prevents unpaid design drift.
How do studios adjust markup when raw material costs move?
Studios use dynamic pricing and frequent reviews to keep margins stable.
When wood, stone, or metal costs rise, they tighten discounting, update price books, and add time-limited quotes or escalation clauses. They also diversify suppliers and substitute materials to protect timelines and margin.
Adopt quarterly cost audits and SKU-level margin dashboards; flag items with sustained margin compression and renegotiate or reprice. Communicate valid-through dates on quotes.
Material volatility requires proactive procurement and fast pricing updates.
These steps maintain predictable profitability despite commodity swings.
What is the typical industry markup for fixtures, hardware, and lighting?
Ancillary categories usually carry 18–60% markups.
Designer-selected hardware and lighting often sit higher because of perceived value and limited distribution. Curated accessory boards in your showroom increase attachment rates and raise average ticket size.
Standardize good/better/best options per style family to speed decisions and protect margin. Keep small-parcel logistics tight to avoid freight nibbling away gains.
Ancillary items are reliable margin boosters in a kitchen design studio.
Train designers to present these early, not as afterthoughts.
How have inflation, supply chain issues, and sustainability changed markups?
Inflation and supply chain disruptions have pushed studios to raise markups and tighten quoting terms.
Studios now include validity windows and escalation clauses to cover sudden wholesale changes, and they carry more safety stock on core SKUs. Sustainability demand adds cost (certified woods, recycled content), yet customers often accept a 9–10% premium for eco options.
Highlight lifecycle value—durability, low-VOC finishes, and energy savings—so clients see total cost of ownership benefits. Use supplier scorecards for resilience and ESG claims.
This is one of the many elements we break down in the kitchen design studio business plan.
Transparent rationale builds trust while protecting margin.
Table: Custom vs. Semi-Custom vs. RTA—markup and risk (for quick quoting)
Use this comparison to set expectations and defend pricing on different cabinet lines.
| Kitchen Type | Typical Cabinet Markup | Operational Notes affecting price and risk |
|---|---|---|
| Custom | 30–45% | Bespoke sizes/finishes; longer lead times; higher install complexity; premium materials; tighter QC; more designer time. |
| Semi-Custom | 20–35% | Standard boxes with upgrade options; faster lead times; moderate install risk; good value for design flexibility. |
| RTA (Ready-to-Assemble) | 15–25% | Flat-pack efficiencies; lowest acquisition cost; client may self-install; narrow finish/options; freight sensitive. |
| Countertops (custom) | 25–50% | Material and fabrication drive risk; templating and site protection matter; premium stones at higher end. |
| Appliances | 15–30% | Retail price pressure; rely on package rebates and coop to lift effective margin; manage delivery/warranty routing. |
| Labor & Install | 20–35% over cost | Complex sites justify higher markups; include remeasure, protection, coordination, and punch. |
| Design Fees | 3–12% of project | Fixed or hourly with minimums; credit-back policies must be explicit; cap revisions to avoid scope creep. |
List: Practical levers to protect margin in a kitchen design studio
- Negotiate supplier rebates, freight caps, and damage allowances tied to volume tiers.
- Standardize “good/better/best” boards for hardware, lighting, and accessories to raise attachment rates.
- Enforce quote validity windows and escalation clauses on volatile materials.
- Run monthly job-cost reviews to compare estimated vs. actual margin by category.
- Adopt bundled packages (cabinetry + tops + appliances) to defend blended margin when discounting a single category.
Regional markup calibration—quick reference table
Adjust category floors to reflect rent, wages, logistics, and competitive intensity in your service area.
| Market Type | Markup Tendency | Why it moves |
|---|---|---|
| Tier-1 metros (e.g., coastal capitals) | Top of range | High rent and wages; complex permitting; higher client expectations for finish and coordination. |
| Tier-2 cities/suburbs | Mid-to-high | Healthy demand with manageable overhead; strong design expectations but easier logistics. |
| Rural/low-density | Mid-to-low | Lower overhead and travel; price sensitivity can be higher; fewer specialty trades available. |
| Tourist/seasonal markets | Higher variability | Seasonal labor swings and access constraints; plan buffers and premium scheduling fees. |
| High-competition corridors | Lower headline, protect bundle | Use bundles and rebates to maintain blended margins while staying price-visible on key items. |
| Supply-chain constrained areas | Higher floors | Long lead times and freight risk require higher markups and stricter quote windows. |
| Eco-focused locales | Premium accepted | Clients pay more for certified woods, low-VOC finishes, and energy-efficient appliances. |
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are encouraged to consult with a qualified professional before making any investment decisions. We accept no liability for any actions taken based on the information provided.
Want more on pricing and profitability for kitchen design studios?
Explore these practical guides for step-by-step methods, benchmarks, and templates you can apply today.
Sources
- Houzz – Standard profit margin on kitchen cabinets
- Ranney Blair – Cost of kitchen countertops
- Buildern – General contractor markup
- Houzz – Reasonable GC markup for kitchen remodel
- kbbreview – Appliance margins context
- Deslaurier – Stock vs. custom vs. semi-custom cabinetry
- DojoBusiness – Kitchen design studio profitability
- Vestabul – Design fees for kitchen designers
- KCA – Supply chain & inflation insights
- PwC – 2024 Voice of the Consumer (sustainability premium)
-Kitchen Design Studio: Business Plan
-Kitchen Design Studio: How to Start
-Kitchen Design Studio: Complete Guide
-Kitchen Design: Bank Financing
-Kitchen Design: Project Value Drivers
-Kitchen Design: Pricing Methods
-Kitchen Remodeling: Industry Trends