Short answer: set your resale price from your full cost, not from your partner's price. Add the partner's price, your tools and third-party costs, your own team's time and a risk buffer, then apply the margin you want. Track markup and margin separately, price recurring services monthly, and buy at a fixed price so your cost is known before you sell.
Markup vs margin: the two numbers to keep apart
Most pricing mistakes in white label start with one confusion: markup and margin are calculated on different bases. Markup is calculated on your cost; margin is calculated on your selling price. The same euro of profit gives two different percentages.
Margin = (resale price - total cost) ÷ resale price
Markup = (resale price - total cost) ÷ total cost
| Markup on cost | Gross margin on price |
|---|---|
| 25 % | 20 % |
| 50 % | 33.3 % |
| 100 % | 50 % |
A 50 % markup is a 33 % margin, not a 50 % one. If your finance team reasons in margin and your sales team adds a markup, your projects will look less profitable at closing than they did at quoting.
The second trap is the base. "Total cost" means everything the project costs you, not only the partner's invoice. Doubling the partner's price looks like a 50 % margin; once your own time and tools are counted, the real margin is lower, as the worked example below shows.
Why there is no reliable margin benchmark, and what to use instead
You will find margin percentages for white-label work on agency and vendor sites. They are rarely sourced, and they mix very different situations: a one-page site and a twelve-month SEO retainer, a premium brand and a price-driven reseller, one country and another. A single figure cannot describe all of them.
Use two internal references instead:
- Your target margin per service type, set by your positioning and your fixed costs.
- Your realised margin per project, measured at closing against what you quoted.
The gap between the two tells you more than any market figure: it shows which services, clients or project types lose money after the quote.
The four-step method to set a resale price
1. Establish your true cost
Start with the partner's price, then add what the partner does not invoice: licences, plugins, hosting, stock assets, fonts, paid tools used for the client. This is your direct cost.
2. Count your internal time
As the reseller, you keep the client relationship: briefing, meetings, review of deliverables, client feedback, quality checks and launch. Estimate these hours and multiply them by your internal hourly cost. This line is the one most often forgotten, and the one that erodes margin first.
3. Add a risk buffer
The buffer covers what neither the partner's price nor your time estimate covers: a client who changes direction after validation, content delivered late, an out-of-scope request that is hard to refuse. Size it to the client and the clarity of the brief, not as a fixed rule. A new client with a vague brief needs a larger buffer than a repeat client with a written specification.
4. Check the price against the market
Apply your target margin to the total: resale price = total cost ÷ (1 - target margin). Then compare the result with what the client would pay for comparable work and with your positioning. If the price is too high, reduce scope or internal time. Do not remove the buffer to win the deal: that only moves the loss to the end of the project.
Pricing by service type
The method is the same for every service, but the pricing unit and the main risk change.
One-off projects (websites, migrations)
Price them per project, with a written scope. The main risks are scope creep and late content. Include content collection time, review rounds and launch support in the price.
Recurring services (maintenance, SEO, advertising, GEO)
Price them per month. The main risk is that the time needed grows while the monthly price stays flat. Cap what the plan includes (tickets, hours or deliverables) and count reporting and client calls as internal time. For GEO as a recurring service, see White-Label GEO for Agencies.
Creative production (motion design, UX/UI)
Price them per deliverable or per set of screens. The main risk is revision rounds driven by several decision-makers on the client side. Get the storyboard or wireframes validated before production starts.
| Service | Pricing unit | Main risk | Include in the price |
|---|---|---|---|
| Website | Fixed price per project | Scope creep, late content | Content collection, review rounds, launch support |
| Migration | Fixed price per project | Data and SEO losses | Redirect mapping, post-launch checks |
| Maintenance | Monthly | Requests above the plan | A cap on tickets or hours, response time |
| SEO, advertising | Monthly retainer | Reporting and call time | Reporting, client calls, tools |
| GEO | Monthly | Measurement time | Measurement protocol, monthly report |
| Motion design | Per deliverable | Storyboard revisions | Storyboard validation, voice and music rights |
| UX/UI | Per set of screens | Decisions by committee | Workshops, prototype review |
What erodes margin: scope creep, revisions, rework, delays
At Genesis Digital Factory, we see agencies lose margin on what happens after the quote far more often than on the partner's price. Four causes come back:
- Scope creep. Small requests added one by one, none worth a change request on its own, which together add days of work.
- Unpriced revisions. Revision rounds bought from a partner at a day rate, or reviewed by your team without being counted.
- Rework. Deliverables that fail your quality check and come back for a second pass, consuming your review time twice.
- Delays. Content or approvals that arrive late, stretching a project over more weeks of account management.
The defence is the same for all four: a written scope, a change-request process the client knows before signing, and a partner whose price does not move with every revision.
Fixed price or day rate: which protects your margin
Look at both sides of the transaction.
When you buy. A fixed price makes your direct cost known before you quote. A day rate makes it move with every change, so your margin is only known at the end. Genesis Digital Factory works on a fixed price with unlimited revisions until final validation: the partner cost of the project does not change when the client asks for another round.
When you sell. A fixed price to the client protects your margin only if the scope is written and changes go through a change request. A day rate suits open-ended work, such as ongoing development, where you resell hours with a known markup.
A fixed purchase price does not protect your internal time. Extra revision rounds still cost your team review hours, which is why internal time and the buffer stay in the method even with a fixed-price partner.
Worked example (base 1,000)
The figures below are illustrative. They are not market data and not Genesis Digital Factory rates. They show how the method works on one client buying a website, a maintenance plan and an SEO retainer. All amounts are in base 1,000: the partner's fixed price for the website is 1,000, and every other amount is expressed against it.
Website (one-off)
| Line | Amount (base 1,000) |
|---|---|
| Partner fixed price | 1,000 |
| Licences and third-party costs | 80 |
| Internal time | 180 |
| Risk buffer | 60 |
| Total cost | 1,320 |
| Resale price with a 35 % target margin (1,320 ÷ 0.65, rounded) | 2,030 |
| Gross margin | 710, i.e. 35.0 % of price |
| Markup | 53.8 % on cost |
On the partner's price alone, 2,030 looks like a doubling and a 50 % margin. On the full cost, the margin is 35.0 %.
Recurring services (per month)
| Service | Partner | Internal time | Other | Total cost | Resale price | Margin |
|---|---|---|---|---|---|---|
| Maintenance | 40 | 10 | Buffer 10 | 60 | 90 | 30, i.e. 33.3 % |
| SEO retainer | 220 | 50 | Tools 10 | 280 | 400 | 120, i.e. 30.0 % |
Over twelve months, the two recurring services bring 1,800 of margin (360 + 1,440), more than twice the margin on the website (710). This is why recurring services deserve a careful monthly price, not a discount to win the site.
What two extra revision rounds do to the website margin
| Scenario | Extra cost | Total cost | Margin |
|---|---|---|---|
| As quoted | 0 | 1,320 | 35.0 % |
| Partner on a day rate: 2 extra rounds billed 100 each + internal review | 290 | 1,610 | 20.7 % |
| Partner on a fixed price: internal review only | 90 | 1,410 | 30.5 % |
The fixed price keeps the partner cost stable; the internal review time still has to come out of the buffer or the margin.
One partner or several: the hidden coordination cost
Spreading work across several suppliers can lower each invoice and raise the total cost. Every extra partner adds briefings, different quality standards, separate invoices and handovers between teams, all of it internal time. When you compare partners, compare the full cost per project, coordination included, not the daily rate.
A single partner covering websites, maintenance, SEO and creative production keeps one process, one quality checklist and one point of contact, which makes your internal time easier to estimate and your margin easier to hold.
FAQ
What margin do agencies typically take on white-label work? There is no reliable public benchmark. Published percentages are rarely sourced and mix services, markets and positionings. Set a target margin per service type from your own costs, then measure the realised margin on each project.
What is the difference between markup and margin? Markup is profit divided by cost; margin is profit divided by the selling price. A 50 % markup equals a 33.3 % margin, and a 100 % markup equals a 50 % margin.
How should one-off projects and recurring services be priced differently? One-off projects are priced per project with a written scope. Recurring services such as maintenance, SEO, advertising or GEO are priced per month, with a cap on what the plan includes and reporting time counted as cost.
What erodes margin on outsourced projects? Mostly what happens after the quote: scope creep, unpriced revisions, rework after quality checks and delays in content or approvals. A written scope, a change-request process and a fixed purchase price limit all four.
Fixed price or day rate: which protects the agency's margin? Buying at a fixed price makes your cost known before you quote. Selling at a fixed price protects your margin when the scope is written and changes go through a change request. A day rate suits open-ended work.
Should an agency tell its client the work is outsourced? It is a business choice. In white label, the partner stays invisible and the agency remains responsible for the result towards its client. What matters is that your contract with the partner covers confidentiality and non-solicitation before the first project.
Price your next project with a known cost
Genesis Digital Factory produces websites, maintenance, SEO, GEO and creative work in white label for agencies, at a fixed price with unlimited revisions until final validation. You know your cost before you quote your client.
Get a fixed quote in 48 h and compute your margin before you sell
Related reading: How white-label web production is priced, Outsourcing web production for agencies, White-label web production glossary.
Sources & Further Reading
This article uses no external market data. Markup and margin are standard accounting definitions, and every figure in the worked example is illustrative.
