With homeowners it's much easier to present a price than it is to explain your business. I think explaining all the details of why material markup is needed would be just the incentive for my client to do business with someone else.
When I'm dealing with businesspeople it's different. I don't have to explain it to them, they know it from their own business.
When I do business with other people I don't ask them to sharpen their pencil or drop their price. I ask them to do a good job for me and price it so they can do it again when I need it.
Dave