WHY SECURITY SYSTEM CONTRACTORS LOSE MARGIN WITHOUT KNOWING IT.
Security Systems margin is lost to three specific things: the unpriced asset, the billing illusion, and the divided house. Security Systems subcontractors at $1M to $5M have 28 percent gross and 6 percent net, against CFOS targets at $1M to $5M of 25 percent gross and 10 percent net. All three are measurable, and all three are invisible without job costing that reads against the estimate.
Security system contractors at $1M to $5M net 6 percent, rising to 13 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 comes out of operations in this trade, never out of pricing. It lives in the three mechanisms below, each of which moves margin without appearing as a failure on any single job. RMR is a balance-sheet asset with a multiple attached: monitoring books trade at 28x to 60x monthly recurring revenue, and a 40-percent RMR mix nearly doubles what a dollar of EBITDA sells for. An integrator who can't state the RMR mix and attrition rate is operating a company whose value is being set by someone else's spreadsheet.
THE MATH BEHIND THE MISSING CASH.
The Unpriced Asset
RMR is a balance-sheet asset with a multiple attached: monitoring books trade at 28x to 60x monthly recurring revenue, and a 40-percent RMR mix nearly doubles what a dollar of EBITDA sells for. An integrator who can't state the RMR mix and attrition rate is operating a company whose value is being set by someone else's spreadsheet.
The Billing Illusion
"RMR contracts are billing, but nobody can tell you which ones are profitable." Monitoring costs, truck rolls, and platform fees erode accounts silently; per-contract P&L is the only lens that sees it.
The Divided House
Install revenue follows construction terms; monitoring follows subscription terms; the market values them on different multiples. One blended P&L does not show which business funds which and misprices both, at exit and every month before it. (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% | 24% | 25% |
| Gross margin, CFOS target | 25% | 26.5% | 27.5% |
| Net profit, industry average | 6% | 9% | 11% |
| Net profit, CFOS target | 10% | 12.5% | 14.5% |
| Overhead, industry average | 16% | 15% | 14% |
| Overhead, CFOS target | 15% | 14% | 13% |
Industry figures are Security Systems contractors' AVERAGE for each revenue band, not a floor. The CFOS net profit target is set at 10 percent after taxes or 3.5 points better than your trade's industry 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 margin and overhead are before tax figures and net profit is an average after taxes, so the three are separate published values. The three CFOS targets tie out: gross margin target minus overhead target equals the net profit target.
Gross margin and overhead come from figures CFMA, Jones Maresca and other sources publish by trade and size, and they are before tax figures. Net profit starts from gross margin less overhead and is then adjusted for taxes and a few other expenses, so it is stated after taxes. It is published as its own average and is not calculated from the other two on the page.
CFMA reports net income before taxes, so a CFMA figure is higher than an after tax figure on the same business. CFMA's 2025 medians are 7.1 percent before interest and taxes and 6.7 percent net income before taxes. Read a net profit figure here against CFMA's with that difference in mind. The bands above the $10M to $25M band are published at runoncfos.com as a modeled extension of the same curves. They have not been reconciled against the licensed CFMA Benchmarker, so read them as a model and not as a survey result.
| Last 12 months revenue | Monthly fee | One-time onboarding |
|---|---|---|
| Up to $1M | $1,900 to $2,900 | $1,000 |
| $1M to $3.5M | $2,600 to $3,900 | $1,500 |
| $3.5M to $6.5M | $3,800 to $5,700 | $3,000 |
| $6.5M to $9.5M | $5,100 to $7,100 | $4,500 |
| $9.5M to $12.5M | $6,100 to $8,500 | $6,000 |
| $12.5M to $15.5M | $7,400 to $11,000 | $7,500 |
| $15.5M to $18.5M | $9,400 to $13,500 | $9,000 |
| $18.5M+ | Quoted individually | Quoted individually |
The onboarding fee covers migrating your books back to the start of your last taxable year and getting you fully operational in 60 days. It's billed once, with your first invoice. It's the same for all three tiers. Your first month is prorated, and your monthly engagement starts on the first of the first full month.
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. The onboarding fee is right here in the table.
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 and never in a report.
Your bookkeeper still does the books.
You stop touching the books.
Everything in Core, and we do the bookkeeping and the controllership as well. Your office stops answering coding questions and stops fixing a reconciliation that will not balance on the last day of the month.
We do the books. No payroll.
Every job shows its margin while it is still open.
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 books, the job costing, and the software. No payroll.
FREQUENTLY ASKED.
