CONSTRUCTION FINANCIAL BENCHMARKS UNDER $1M REVENUE.
Under $1M in revenue you're below where published trade benchmarks start, so overhead is the defining number. Expect gross margin at the low end of your trade, overhead frequently at 15 percent or higher, and net profit under 5 percent. Every net profit figure on this page is stated before taxes, the same basis CFMA reports on.
The reason is arithmetic rather than skill. A small commercial sub carries most of the same fixed costs as a bigger one: an office, a truck, insurance, software, and an owner who has to eat. Under $1M there isn't enough revenue underneath those costs to hold them down to a normal percentage, so they eat the margin the crews earned. That's why the trade you work in counts for less than the overhead you carry at this size, and why every profitability conversation under $1M starts with the fixed cost number and not with the bid.
WHAT IT MEANS.
A construction financial benchmark is the gross margin, overhead, or net profit percentage a subcontractor of a given trade and revenue size should be hitting.
If you're under $1M and want to know what good looks like, the honest read is that your overhead decides your year. This page gives the targets a small commercial subcontractor should hit, the $1M to $5M benchmark band you're growing toward, and the one lever that moves profitability most at this size.
Fixed costs don't spread efficiently under $1M of revenue, so overhead frequently runs 15 percent or higher, above the floor of any standard benchmark band. Gross margin tends to sit at the low end of the trade's range at the same time, which leaves very little between the two. Published benchmarks simply don't start down here, so a small sub comparing itself to a trade average is comparing itself to a business with a different cost structure.
THREE NUMBERS AT YOUR SIZE.
Overhead percent
This is the make or break number under $1M. Calculate it honestly: every fixed cost divided by revenue, with your own market rate wage included. Most owners guess 10 percent and the true figure comes back between 15 and 25 percent. If yours is over 15 percent, that's the first fix, ahead of everything else on the list.
Gross margin
Gross margin tells you whether your jobs cover their own costs with room left over. If it sits below your trade's range, the problem is in your estimating or your job costing rather than in the quality of your work. Crews rarely lose a job that was priced and tracked correctly, so a low margin is usually a paperwork failure and not a field failure.
Owner pay
Put yourself on payroll at a defined wage instead of taking whatever is left. If the business can't pay you a real wage and still net a profit, the numbers are telling you something before a buyer or a bank does. An owner working for free is the most common way a business under $1M looks like it's breaking even when it's losing money.
WHAT IT LOOKS LIKE IN DOLLARS.
Gross margin, overhead, and net profit in the $1M to $5M band run as follows: civil 21 percent, 14 percent, and 5.5 percent; excavation 21 percent, 14 percent, and 5.5 percent; concrete 21 percent, 14 percent, and 5.5 percent; electrical 25 percent, 16 percent, and 7.5 percent; SWPPP and erosion 24 percent, 14 percent, and 7.5 percent; drywall 19 percent, 13 percent, and 5.5 percent; framing 18 percent, 13 percent, and 5.0 percent.
Under $1M, expect gross margin at the low end of your trade's range, overhead a few points higher than the figures above, and net profit thinner, often under 5 percent. The CFOS target sets the bar a step better than the industry average: gross margin plus 2 points, net profit plus 1.5, overhead minus 2. Those three adjustments are what separate a business that survives its size from one that grows out of it.
A civil contractor running 30 percent overhead against a 29 percent gross margin was losing 1 percent on every job and didn't know it. Once the real overhead was calculated and cut, the same business turned a hidden per job loss into double digit net profit, with no change to the work. Every crew, every contract, and every customer stayed the same.
OVERHEAD IS THE FIX.
At this size you can't out bid your way to profit, because the math is overhead. Add up every fixed cost from the last twelve months, put a market rate wage for yourself in that total, and divide by revenue. That single figure tells you whether your bids have ever carried the true cost of running the company.
Once you know the real rate, walk the list line by line to decide which fixed costs produce work and which ones are just habits. Software nobody opens, a truck payment on a truck that sits, and an office bigger than the crew needs all turn up here. Cutting two or three of them moves the overhead percentage more than a whole quarter of better bidding does.
The other half of the answer is more revenue underneath the costs you decide to keep. Growing into the $1M to $5M band with the same office and the same insurance policy drops the overhead percentage without cutting anything at all. That's why the fix at this size is a combination: cut what's dead weight, then grow into the rest of it.
FLAT MONTHLY FEE. NO SURPRISES.
Three tiers, priced by your trailing twelve month revenue. Which one you're in depends on how much of the work you want off your desk. No hourly billing, no payroll, and no add-ons.
Pricing
| 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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