CONSTRUCTION PROFIT AND LOSS STATEMENT.
The P&L is the financial statement most subcontractors look at most often, and most misread. Here is what each section means for a commercial subcontractor, what healthy looks like at your revenue level, and the two numbers that count more than the bottom line.
The bottom line is the number most owners read and the least useful one on the page. Gross profit margin tells you whether the work is priced and produced correctly. Overhead rate tells you whether the office is sized for the volume you're handling. Net profit is only what's left after those two, so it can never tell you which of them caused the result. Read the two upstream numbers and their trend across several months, and the bottom line stops being a surprise in February.
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 profit and loss statement is the report that sets out revenue, direct job cost, gross profit, overhead, and net profit for a period, which is what the business earned rather than what it collected.
WHERE IT GOES WRONG.
You look at the bottom line and miss everything else
Most subcontractors check whether the P&L shows a profit and stop reading. The bottom line is the least useful number on the statement. Gross profit margin, overhead rate, and the trend of both over time tell you far more about the health of the business than whether you made or lost money in a given month.
Your P&L doesn't reflect construction reality
A P&L kept on cash basis, or kept without percentage of completion revenue recognition, doesn't reflect the work you performed. Revenue spikes on billing dates and drops in slow billing months. Costs post when invoices get processed rather than when the work happened. The result is a P&L that's technically correct and operationally useless for a management decision.
You can't tell which part of the business is profitable
A single column P&L gives you total revenue and total cost, and it doesn't tell you which jobs, which GCs, or which trade scopes generated the profit. Without job level cost data going into the P&L structure, the statement tells you what happened and never tells you why.
WHAT EACH SECTION IS TELLING YOU.
Revenue is contract revenue recognized for the period, meaning earned revenue based on work performed rather than work billed. Direct costs are all job level costs: field labor and burden, materials, subcontractors, and equipment allocated to jobs. Gross profit is revenue minus direct costs, the margin before overhead, and gross profit percentage is gross profit divided by revenue, which is your most important operational metric. Overhead is all G&A: office staff, rent, insurance, equipment overhead, vehicles, and marketing. Net profit is gross profit minus overhead, which is what the business made.
For most commercial subcontractors: a gross profit margin of 15 to 25% depending on trade, an overhead rate of 8 to 18% depending on revenue size, and a net profit margin of 5 to 8% for a well managed business. If gross margin is in range but net profit is low, overhead is the problem. If gross margin is below range, pricing, estimating, or job cost leakage is the problem. SPM works out which one is causing your specific situation during the 20 minute call.
SPM reviews your P&L monthly rather than at year end. Gross margin trends, overhead rate movement, and net profit trajectory all get tracked over time. When any of the three falls outside the benchmark for your trade and revenue range, it comes to the monthly meeting with a specific explanation and a recommendation. The P&L becomes a management tool instead of a tax document.
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 | $1,000 |
| $1M to $3.5M | $2,600 | $4,100 | $5,300 | $1,500 |
| $3.5M to $6.5M | $3,800 | $5,900 | $8,300 | $3,000 |
| $6.5M to $9.5M | $5,100 | $7,600 | $11,800 | $4,500 |
| $9.5M to $12.5M | $6,100 | $8,900 | $14,900 | $6,000 |
| 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 $3,000, 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.
