WHY ELEVATOR CONTRACTORS LOSE MARGIN WITHOUT KNOWING IT.
Elevator margin is lost to three specific things: the annuity underneath, the proprietary wall, and the flat-priced portfolio. All three are measurable, and all three are invisible without job costing that reads against the estimate.
Elevator contractors at $1M to $5M net 8.5 percent on the SPM 48-trade dataset, the highest floor of all 48 trades, rising to 10.5 percent by $25M to $50M; the CFOS target at $1M to $5M is 12 percent. The distance between the trade average and the CFOS target isn't a pricing problem in this trade. It sits in the three mechanisms below, each of which moves margin without appearing as a failure on any single job. Maintenance contracts at $500 to $1,200 per unit per month recur, compound, and explain the best net-profit floor in the 48-trade dataset. The operator who tracks per-unit contract P&L owns an asset; the one who doesn't owns a route.
THE MATH BEHIND THE MISSING CASH.
The Annuity Underneath
Maintenance contracts at $500 to $1,200 per unit per month recur, compound, and explain the best net-profit floor in the 48-trade dataset. The operator who tracks per-unit contract P&L owns an asset; the one who doesn't owns a route.
The Proprietary Wall
OEM controllers, $10,000 diagnostic tools, and obsolescence declarations define the independent's serviceable universe, and every proprietary install shrinks it. Strategy in this trade starts with a map of what you can actually maintain.
The Flat-Priced Portfolio
Full-maintenance pricing is an actuarial bet, and a portfolio priced flat across unit ages subsidizes the worst cars with the best. Callback rates per unit, repriced at renewal, are the trade's underwriting discipline. (cfos-job-profitability-system) ---
WHAT CHANGES IN THE FIRST 60 DAYS.
| Metric | $1M to $5M | $5M to $10M | $10M to $25M |
|---|---|---|---|
| Gross margin, industry average | 27% | 28% | 29% |
| Gross margin, CFOS target | 29% | 29% | 29% |
| Net profit, industry average | 9% | 11% | 13% |
| Net profit, CFOS target | 12% | 13% | 14% |
| Overhead, industry average | 18% | 17% | 16% |
| Overhead, CFOS target | 17% | 16% | 15% |
Industry figures are Elevator contractors' AVERAGE for each revenue band, not a floor. The CFOS net profit target is set at 10 percent before taxes or 3.5 points better than your trade's average at your revenue, whichever is higher, and the gross margin target is set at whatever gross margin produces that net profit once your overhead is paid, and never below your trade's own average. Gross minus overhead equals net on every column, so the rows tie out.
| Last 12 months revenue | Monthly fee |
|---|---|
| Up to $1M | $1,900 to $2,900 |
| $1M to $3.5M | $2,600 to $3,900 |
| $3.5M to $6.5M | $3,800 to $5,700 |
| $6.5M to $9.5M | $5,100 to $7,100 |
| $9.5M to $12.5M | $6,100 to $8,500 |
| $12.5M to $15.5M | $7,400 to $11,000 |
| $15.5M to $18.5M | $9,400 to $13,500 |
| $18.5M+ | Quoted individually |
Range reflects the three tiers below. Which one you're in depends on how much of the work you want off your desk. No payroll. No hidden line items.
You stop guessing.
You get the CFO work. Job costing built against the way you estimate, a 13 week cash forecast, monthly WIP, and a meeting every month that ends in decisions rather than a report.
Your bookkeeper keeps doing the books.
You stop touching the books.
Everything in Core, and we run the bookkeeping and the controllership as well. Nobody in your office is answering coding questions or chasing a reconciliation at month end.
We do the books. No payroll.
Every job shows its margin while it's still running.
Everything in Executive, plus the job costing and WIP platform set up, loaded with your cost codes, and managed for you every month. You never have to learn it.
We do the job costing.
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