ESTIMATING IS WHY YOU'RE NOT PROFITABLE.
When the estimate is built on a wrong overhead rate, stale burden rates, or production assumptions that don't match the field, the job is priced to lose money before the contract is signed. Profit isn't what's left over after costs. Profit is a decision you make before the bid goes out. No amount of field execution fixes a structurally wrong estimate.
The profit shortfall in most subcontracting businesses is structural. It's built into the estimate, so by the time the crew mobilizes the outcome of the job is mostly decided. Good superintendents can protect a thin job and they can't rescue one that was priced 8 points under cost. The only way to close the shortfall is to correct the inputs the estimate is built on: the overhead rate, the burden rates, and the cost code structure that lets you compare what you bid to what you spent.
WHAT IT MEANS.
Profit is a decision you make before the bid goes out rather than what's left over after the costs come in.
If you can't win work at a price that covers real costs plus target profit, there are two choices: cut costs or find different work. There's no third option. Winning at the wrong margin and hoping the field makes up the difference is how companies that look profitable run out of cash.
THE FOUR ESTIMATING FAILURES.
Overhead rate too low
You estimate with 10 percent overhead and you're running 18 percent. Every job you bid is priced 8 points below what it costs to execute. You win the work, you do the work, and the money isn't there. It never was, because the estimate didn't capture the true cost of running the business.
Burden rates stale or wrong
You estimated labor at $38/hr burdened and the current burden is $44/hr. On 5,000 hours that's $30,000 in untracked variance per job before the first nail is driven. Burden rates move with every benefits renewal, every workers comp adjustment, and every union rate update. Most estimators are using a rate that was right 18 months ago.
Estimating and job costing speak different languages
The estimator builds a bid by phase and scope. The bookkeeper codes costs by account and category. The two structures don't line up, so you can't compare what you bid to what you spent. When the estimate and the actuals don't align, you can never learn from job history, and every new estimate starts from scratch instead of from evidence.
Profit treated as a leftover
Most estimators add markup on top of costs and call whatever comes out the profit. Profit isn't a leftover. It's a decision you make before the bid goes out. CFMA's 2024 Construction Financial Benchmarker reports 21.8 percent gross profit margin and 6.3 percent net income before taxes across all respondents, with the best-in-class top quartile at 11.9 percent before taxes, and an average isn't a target. The figure your estimate has to produce is the one for your trade at your revenue on /construction-subcontractor-financial-benchmarks-by-trade, priced to clear SPM's 10 percent net profit floor before taxes. If the estimate doesn't produce it after real overhead and real burden rates are applied, you either cut costs or walk from the bid.
WHAT IT LOOKS LIKE IN DOLLARS.
Estimate at 10 percent overhead while you're running 18 percent and every bid is priced 8 points under cost. Estimate labor at $38/hr burdened while the true burden is $44/hr and a 5,000 hour job carries $30,000 of variance before anybody swings a hammer. Neither number is visible in the field. Both of them get decided at a desk.
THREE THINGS THAT CHANGE.
The overhead rate gets confirmed against the true cost base and the burden rates get updated at every benefits change. Those two inputs set the floor price on every job. When they're right, the estimate reflects what it costs to execute the work. When they're wrong, no amount of careful scope work saves the job.
Every line in the estimate maps to a job cost code, with the same categories and the same language. Material in the estimate matches the material cost code. Labor by work type in the estimate matches labor by work type in the job cost report. When they align, you can compare bid to actual at closeout and use that history to sharpen the next estimate.
The published figures belong to somebody else: CFMA's 2024 Construction Financial Benchmarker reports 21.8 percent gross profit margin and 6.3 percent net income before taxes across all respondents, and Jones Maresca and Company's 2025 Performance Benchmarks put specialty contractor gross margin at 15 to 25 percent with total indirect cost at 8 to 15 percent. Those are averages across the industry rather than targets, and /construction-subcontractor-financial-benchmarks-by-trade gives the figures for your trade and revenue band. Build the estimate, apply overhead, and apply the burden rates. If the markup required to clear a 10 percent net profit floor before taxes produces a number the market won't accept, you have a cost structure problem rather than a markup problem. Fix the cost structure, and don't chase work hoping something changes.
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.
FREQUENTLY ASKED.
