The 2027 Construction Trade Benchmark Report
Gross margin, overhead and net profit for 48 commercial trades, across 7 revenue bands, with the CFOS target beside every figure up to $10M to $25M. The 4 bands above that are a modeled extension with no target.
Commercial subcontractors run 18% to 27% gross margin and 13% to 18% overhead, with 2% to 10% net profit before taxes. The averages are 22.1%, 15.1% and 7%. Overhead falls an average of 6.1 points as a business moves from $1M–$5M to $500M+.
Trade decides more than size does
At the same revenue, the spread between trades is wider than the spread a single trade sees across all 7 bands.
| Metric | Lowest | Highest | Average | Spread |
|---|---|---|---|---|
| Overhead | 13% (Framing, Acoustic ceiling, Drywall and 2 more) | 18% (Elevator, Curtain wall and glazing, Scaffolding) | 15.1% | 5 pts |
| Gross margin | 18% (Grading, Sitework, Underground utility and 2 more) | 27% (Elevator, Curtain wall and glazing) | 22.1% | 9 pts |
| Net profit | 2% (Grading) | 10% (SWPPP and erosion control) | 7% | 8 pts |
Overhead is the number that moves with growth
Every trade in the reference sheds overhead points as revenue climbs. Gross margin and net profit improve too, and all three CFOS targets recalculate at every band up to $10M to $25M, using the same rule that reproduces the published figure at the first one. No target is published above that.
| Trade group | Trades | Overhead at $1M–$5M | Overhead at $500M+ | Points shed |
|---|---|---|---|---|
| Civil and earthwork | 11 | 15% | 8.8% | 6.2 |
| Concrete and masonry | 5 | 14.6% | 8.6% | 6 |
| Landscape and irrigation | 2 | 15% | 9% | 6 |
| Electrical and technology | 6 | 15.5% | 9.5% | 6 |
| Mechanical and life safety | 7 | 16.1% | 9.9% | 6.2 |
| Envelope and structure | 8 | 15.1% | 8.9% | 6.2 |
| Interiors and finishes | 6 | 13.3% | 8% | 5.3 |
| Specialty | 3 | 16% | 9.7% | 6.3 |
One target sets the other two
Overhead's target is one point leaner than the trade's own industry average at that size, and that alone reproduces the published figure on all 48 trades. Net profit's target is 10% before taxes, or 3.5 points better than average, whichever is higher, verified the same way. Gross margin isn't measured or guessed: its target is whatever margin produces that net profit target once overhead is paid, floored at the trade's own industry average, and that's what the published figure already equals on every one of the 48. Three rules, the same numbers the compiled data already shows, so this report recalculates all three at every band instead of only the first one.
Every target on this site recalculates with revenue now. See the methodology for the full derivation and sourcing.
Read it by metric, by group, or by trade
What is underneath these numbers
SPM The Construction CFO. SPM Trade Benchmark Reference. 2026. Sulphur Prairie Management, LLC. https://runoncfos.com/benchmark-report-2027. CC BY 4.0.
Figures on this page were last revised 2026-08-21. Published under CC BY 4.0, which permits reuse of any figure here, including commercially, as long as the credit above travels with it. The same figures in machine-readable form: /benchmarks.json.
Trade level gross margin and overhead compiled by SPM The Construction CFO, validated against published CFMA and JMCO benchmarks. The CFOS targets beside them are from the book CONTROL: The Construction Financial Operating System, published with the full reference at runoncfos.com.
- 2024 Construction Financial Benchmarker, Executive Summary, Construction Financial Management Association, 2024. The survey puts gross profit margin at 21.8%, SG&A at 11.8%, and net income before taxes at 6.3% across all respondents. The best-in-class top quartile reaches 11.9% net income before taxes. Those figures are the whole-population reading, so a single trade can come out well either side of them.
- 2025 Construction Financial Benchmarker, Executive Summary, Construction Financial Management Association, 2025. Reporting fiscal 2024, from 1,639 submissions with 1,558 surviving data screening. Net income before taxes came to 6.7% across all respondents, up from 6.3%, and 12.0% for the best-in-class quartile. The relevant edition here is the segment split: specialty trade contractors on their own reported 7.7% net income before taxes, up from 6.9%, on a gross profit margin of 22.4%, up from 21.9%. Those are the figures to read against this reference, because they describe the same kind of business it covers rather than the whole industry.
- 2025 Performance Benchmarks, Construction Companies, Jones Maresca and Company, 2025. This study reports specialty contractor gross margin between 15% and 25%. It puts net profit at 5% to 8% for a well managed company, and total indirect cost between 8% and 15%. The indirect cost band is the one worth reading twice, because it's the number most owners have never calculated for their own shop.
- SPM Trade Benchmark Reference, Sulphur Prairie Management, LLC, 2026. The reference holds 48 trades, each publishing a row of its own across all 7 revenue bands, and net profit in it is stated before taxes.
How these figures were built. The trade figures are SPM's own compilation, validated against CFMA's 2024 Benchmarker, CFMA's 2025 Benchmarker and the Jones Maresca and Company 2025 specialty contractor benchmarks. CFMA's Benchmarker is a licensed product and nothing here is copied from it. Net profit is calculated as gross margin minus overhead, so the three figures tie out in every band. Every trade in the reference publishes a row of its own. Each new edition is validated against the latest CFMA and JMCO releases before publication.
Which bands are measured. The first 3 bands fall inside the range the published surveys report, and across all 48 trades at those 3 bands gross margin averages 23.4% against the 21.8% CFMA publishes for all respondents. The 4 bands above $10M–$25M follow the same curve further out, where the all trade average reaches 30.3%. Those 4 have not been reconciled against the licensed CFMA Benchmarker, so every export labels them as modeled and this page says so before you use them.
What owners ask
What net profit should a commercial subcontractor make?
Across the 48 published trades in this report, net profit before taxes at $1M–$5M runs from 2% to 10%, averaging 7%. SWPPP and erosion control is at the top at 10%. Grading is at the bottom at 2%.
What is a good gross margin for a subcontractor?
Gross margin at $1M–$5M runs 18% to 27% across the 48 published trades, averaging 22.1%. Trade structure explains most of the spread. Labor-heavy trades earn more margin because they take more risk in the hours.
How much overhead should a construction company run?
Overhead at $1M–$5M runs 13% to 18% of revenue, averaging 15.1%. It falls as revenue grows, by an average of 6.1 points between $1M–$5M and $500M+, because the indirect cost base grows in steps while revenue grows continuously.
What is the CFOS target and how is it set?
Three rules, each verified against every published trade at $1M–$5M before this report trusted them at any other band. Overhead is one point leaner than the industry average at your revenue band. Net profit is 10% before taxes, or 3.5 points better than average, whichever is higher. Gross margin is whatever margin produces that net profit target once overhead is paid. All three recalculate at your revenue band, not only the first one, up to $10M to $25M. No target is published above that.
Where does the underlying data come from?
The trade figures are SPM's own compilation, validated against CFMA's 2024 Benchmarker, CFMA's 2025 Benchmarker and the Jones Maresca and Company 2025 specialty contractor benchmarks. CFMA's Benchmarker is a licensed product and nothing here is copied from it. Net profit is calculated as gross margin minus overhead, so the three figures tie out in every band. Every trade in the reference publishes a row of its own. Each new edition is validated against the latest CFMA and JMCO releases before publication. Full sourcing, including what is survey data and what is original analysis, is on the methodology page.
Can I cite this report?
Yes, and the licence asks you to. Every page with figures on it ends with a formed citation you can copy, and the reference publishes under CC BY 4.0, so reuse is permitted as long as the credit travels with the number. Where a figure originates in a third-party survey, cite that survey too. The methodology page lists every one of them.
Josh Luebker ran commercial construction projects before he ran the numbers behind them, on data centers, military bases, hospitals, and high-rises. He wrote CONTROL: The Construction Financial Operating System, which is an 8 step framework for commercial subcontractors, and it came out October 1, 2026. He is a master electrician who moved into the office and kept the field vocabulary.
SPM The Construction CFO maintains the benchmark reference behind these figures. Every edition is validated against the newest CFMA and JMCO releases before it publishes here. Where a figure changes between editions, the older edition keeps its year in the title so a citation to it stays correct.