WHY INSULATION CONTRACTORS LOSE MARGIN WITHOUT KNOWING IT.
Insulation margin is lost to three specific things: the blended product book, the set-yield spread, and the cover-up clock. Insulation subcontractors at $1M to $5M run 22 percent gross and 6.5 percent net, against CFOS targets at $1M to $5M of 23 percent gross and 10 percent net. All three are measurable, and all three are invisible without job costing that reads against the estimate.
Insulation contractors at $1M to $5M net 6.5 percent, rising to 8.5 percent by $10M to $25M and plateauing at 8.5 percent in the top band; the CFOS target at $1M to $5M is 10 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. Batt, blown, and spray are three businesses with three cost structures sold under one estimate history. Whichever line is mispriced highest wins the worst work.
THE MATH BEHIND THE MISSING CASH.
The Blended Product Book
Batt, blown, and spray are three businesses with three cost structures sold under one estimate history. Whichever line is mispriced highest wins the worst work.
The Set-Yield Spread
Spray foam is bought in chemical sets and sold in board feet, and geometry, temperature, and overspray tax every set. The per-job yield reconciliation is the trade's truth report; skip it and the waste factor becomes folklore.
The Cover-Up Clock
Insulation passes inspection or the drywall behind it stalls; it mobilizes after rough-in or eats the compression. The trade lives in the schedule's narrowest slot and gets paid like it has float. (cfos-cash-flow-cycle-system) ---
WHAT CHANGES IN THE FIRST 60 DAYS.
| Metric | $1M to $5M | $5M to $10M | $10M to $25M |
|---|---|---|---|
| Gross margin, industry average | 22% | 23% | 24% |
| Gross margin, CFOS target | 23% | 23% | 24% |
| Net profit, industry average | 8% | 10% | 12% |
| Net profit, CFOS target | 10% | 11% | 13% |
| Overhead, industry average | 14% | 13% | 12% |
| Overhead, CFOS target | 13% | 12% | 11% |
Industry figures are Insulation 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.
FREQUENTLY ASKED.
