Typical commercial markup: 5-10% on materials, 10-20% on labor, 5-10% on subcontract, 10-30% on equipment. Self-performed work usually carries higher markup than subcontracted work.
Overhead covers indirect business costs: estimating salaries, office rent, insurance, vehicles, support staff. Profit is the company's earnings on the project. Some contracts separate the two; most lump them as O&P.
Markup compounds. A bid with $1M direct cost and 15% markup totals $1.15M. If a subcontractor inside that bid has their own 10% markup on a $200K self-performed line, the GC's 15% applies on top — the customer ultimately pays markup twice on that line.