WHY LANDSCAPING CONTRACTORS LOSE MARGIN WITHOUT KNOWING IT.
Landscaping margin is lost to three specific things: the mix that sets the multiple, the windshield tax, and the favor that became the baseline. All three are measurable, and all three are invisible without job costing that reads against the estimate.
Landscaping contractors at $1M to $5M net 5 percent on the SPM 48-trade dataset, tied for the thinnest floor of the 48, rising to 7.5 percent by $25M to $50M; 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. Maintenance books trade at 6 to 9x and install books at 4 to 5.5x, and the same profit dollar is worth different amounts depending on which earned it. Divisional P&Ls aren't accounting hygiene; they're the exit strategy.
THE MATH BEHIND THE MISSING CASH.
The Mix That Sets the Multiple
Maintenance books trade at 6 to 9x and install books at 4 to 5.5x, and the same profit dollar is worth different amounts depending on which earned it. Divisional P&Ls aren't accounting hygiene; they're the exit strategy.
The Windshield Tax
Six-plus unpaid person-hours a day of drive time hides inside route pricing built on property time instead of crew time. Route density and crew-day P&Ls are where the thin 5 percent floor gets lifted.
The Favor That Became the Baseline
Twelve-month contracts absorb informal additions until the extras are the expectation. The scope log and quoted enhancements keep the annuity an annuity instead of a slow leak. (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 | 22% | 23% | 24% |
| Gross margin, CFOS target | 24% | 23% | 24% |
| Net profit, industry average | 7% | 9% | 11% |
| Net profit, CFOS target | 10% | 10% | 12% |
| Overhead, industry average | 15% | 14% | 13% |
| Overhead, CFOS target | 14% | 13% | 12% |
Industry figures are Landscaping 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. The gross margin and overhead figures for this trade are derived from the nearest comparable trade in the same dataset, and were not measured directly.
| 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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