FINANCIAL GOALS FOR A SUBCONTRACTOR.
Across construction as a whole, CFMA's 2024 Construction Financial Benchmarker reports 21.8 percent gross profit margin, 11.8 percent SG&A and 6.3 percent net income before taxes across all respondents, with the best-in-class top quartile at 11.9 percent before taxes. An average isn't a goal, and none of those figures belongs to your trade at your revenue, which is what /construction-subcontractor-financial-benchmarks-by-trade sets out band by band. The CFOS target starts from the book CONTROL's rule of thumb of 12 percent net profit before taxes, which is twelve cents on every dollar of revenue, or $12,000 on every $100,000 that comes through the business, and each trade's own target is its average at its revenue band plus 3.5 points, never below 10 percent. That rule of thumb is well above what the industry averages and level with what the top quartile earns, and it's what makes operating the business worthwhile for the owner shouldering the payroll, the bonding, and the personal guarantees. Revenue isn't on the list at all, because revenue is a multiplier rather than a goal.
None of these are a switch you flip. They're where a controlled subcontractor ends up after the work gets done, and the work is the same regardless of size: calculate the real overhead rate, build job costing, fix billing and collections, then read the numbers every month. Sixty days to install the system, six months to stabilize, and then the targets come into reach. A $3M sub netting 4 percent and an $8M sub netting 11 percent are on the same road at different mile markers.
Want Josh to check your own numbers? Financial Health Snapshot, $1,500 one time. Your last 12 months read against your trade's benchmarks, with a 60 minute readout.
WHAT IT MEANS.
A subcontractor's financial goals are a set of ratios and reserves rather than a revenue number: a net profit target of 12 percent before taxes, gross profit per project that clears the overhead rate for their own trade and revenue band, overhead measured honestly and managed down, a cash floor in the bank, growing working capital, and zero debt.
Revenue multiplies whatever margin you already have, in both directions. At a 12 percent net, a million dollars of revenue is a hundred and twenty thousand dollars of profit. At a loss, that same million just speeds up the damage. The right goals are the ratios and reserves beneath revenue, which is gross profit, net profit, overhead, cash, working capital, and debt, and revenue turns into leverage once those are in range.
AIMING AT THE WRONG NUMBER.
Revenue is the goal instead of the ratios underneath it
At a 12 percent net, a million dollars in revenue makes a hundred and twenty thousand. At a loss, that same million just speeds up the damage. Pursuing revenue before the margin is right is how subcontractors grow themselves broke, and it feels like success right up until payroll week.
Net profit is under 10 percent and nobody knows it
Most subcontractors have a net under 10 percent without knowing, because overhead is uncalculated and job costing is missing. Gross profit is what covers overhead, and net profit is what the business keeps, so if you can't state your overhead rate you can't state your net either. The number exists whether or not anybody reports it.
Overhead is believed to be 10 percent and is 25 to 40
Most subs believe overhead is around 10 percent of revenue, and it turns out to be 25 to 40 percent. Knowing the real figure and managing it down toward the benchmark for their own trade and revenue band is often the single largest profit lever in the business, because every point of overhead comes straight off net. Nothing about the work in the field has to change to collect it.
The owner isn't paid a real salary
Paying yourself out of whatever cash is left is a residual. The target is a fixed salary the business can sustain, with draws from profit on top of it, and at the top of the $1M to $12M range that salary is around $180,000. An owner who can't pay themselves a real wage doesn't yet have a business, they have a job that owns them.
WHAT IT LOOKS LIKE IN DOLLARS.
Twelve percent net profit before taxes is the book CONTROL's rule of thumb for the CFOS target, and each trade's own target is its average at its revenue band plus 3.5 points, never below 10 percent. That's twelve cents on every dollar of revenue, or $12,000 on every $100,000 that goes through the business, and it's not price gouging. It's what makes operating the business worthwhile, because an owner shouldering the payroll, the bonding, and the personal guarantees needs more out of it than a savings account would pay.
CFMA's 2024 Construction Financial Benchmarker reports 6.3 percent net income before taxes across all respondents, on 21.8 percent gross profit margin, with the best-in-class top quartile at 11.9 percent before taxes. Jones Maresca and Company's 2025 Performance Benchmarks put specialty contractor gross margin at 15 to 25 percent. Those are whole-industry figures rather than a target for your trade, and a sub at $2M doesn't earn the same margin as one at $10M, which is why /construction-subcontractor-financial-benchmarks-by-trade publishes both by trade and revenue band. The 12 percent rule of thumb is level with the top quartile on purpose: high enough that the business pays the owner for the risk they take on, and reachable for a well managed sub at any size.
Jones Maresca and Company put total indirect cost at 8 to 15 percent of revenue for construction as a whole, and CFMA reports SG&A at 11.8 percent across all respondents. Both are descriptions of the market rather than a rate to hold. Most subs believe their own is around 10 percent and it is 25 to 40 percent, so the first job is measuring it honestly, and the rate for your trade and band is on /construction-overhead-rates-by-trade. Every point you take out of overhead comes straight off net, which is why this is usually the largest single move available in the business.
For a mature business at the top of the range, that's what the balance sheet reads: a cash floor held at all times, working capital growing so bonding capacity rises with it, and zero debt, meaning no maxed lines of credit and no stacked advances. Those three together are what let an owner sleep through a slow month. They're also what a bank and a surety read first.
That's the owner salary at the top of the $1M to $12M range, paid as a fixed salary the business can sustain, with draws from profit on top of it. The structure counts more than the figure: a wage first, distributions second. Living off whatever cash is left over is how an owner ends up funding the company out of their own household.
A DESTINATION, NOT A SWITCH.
The path is identical whether you're at $3M or $8M: calculate real overhead, build job costing, fix billing and collections, and track the numbers monthly. Sixty days to install the system, six months to stabilize, and then the targets come into reach. A subcontractor at $3M netting 4 percent and one at $8M netting 11 percent are on the same road at different mile markers.
Set goals for margin, overhead, cash, and debt, and treat revenue as the output rather than the input. A subcontractor clearing the gross margin and overhead benchmark for their own trade and revenue band, holding net profit at 10 percent or better, keeping a cash floor, and holding zero debt is in control of the business whatever the top line says. The goals don't change with size. What changes the business is the discipline to reach them.
SPM The Construction CFO calculates the real overhead rate, builds job costing against the way you estimate, fixes billing and collections, and reports the numbers every month, which together is the system that moves a subcontractor toward these targets. Sixty days to install it. The targets are the destination and the monthly rhythm is how you get there.
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. The one-time onboarding fee is right here in the table.
Built for subs doing $1M to $12M. Above $12.5M we quote.
| Last 12 months revenue | Core | Strategic | Platinum | One-time onboarding |
|---|---|---|---|---|
| Under $1M | $1,900 | $3,100 | $3,300 | $2,500 |
| $1M to $3.5M | $2,600 | $4,100 | $5,300 | $4,500 |
| $3.5M to $6.5M | $3,800 | $5,900 | $8,300 | $6,000 |
| $6.5M to $9.5M | $5,100 | $7,600 | $11,800 | $7,500 |
| $9.5M to $12.5M | $6,100 | $8,900 | $14,900 | $9,000 |
| Above $12.5M | Quoted | Quoted | Quoted | Quoted |
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, and it moves with your revenue band. Your first month is prorated, and your monthly engagement starts on the first of the first full month.
Just want the setup? Onboarding only is the same onboarding work with no monthly service after it, one time, at the onboarding fee plus $2,000. Start a monthly engagement later and $2,000 counts toward it. It starts at $4,500, and the price for every band is on the pricing page.
The three tier columns are the whole price. Which one fits 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.
- Online software only: QuickBooks, Sage, Viewpoint and similar. No VPN or hosted desktop.
- Not in any tier: payroll, pay applications, collections on receivables.
- Pricing valid through 2027.
CFO work. Your own bookkeeper keeps doing the books.
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.
Core, plus bookkeeping and bank reconciliations, plus job costing and WIP software set up and managed for you. Use your own online accounting software or we supply it, one price.
Every job shows its margin while it is still open.
Everything in Core, plus the bookkeeping and bank reconciliations done for you, and the job costing and WIP software set up, loaded with your cost codes, and managed every month. Use your own online software, or move to ours and we cover it.
A bookkeeper we choose does the books and reconciliations. No payroll.
Strategic, plus a controller who handles payables and receivables the way an in-house controller would. You approve every payment.
You approve, and the money side gets handled.
Everything in Strategic, plus a controller we choose who handles your bills and receivables for you the way an in-house controller would. They call vendors, pay the bills and keep the accounting current. We plan the cash flow first, and you approve every payment because it is your money.
A controller we choose does the payables and receivables. No payroll, no pay applications, no collections.
FREQUENTLY ASKED.
