The company running 12% net profit
Twelve percent is above what every one of the benchmarked trades averages. That's the point of it. It's a target, and the published averages are what happens without one.
Net profit is what survives after overhead, and overhead is the number most owners have never worked out. If gross profit is a field number, net profit is an office number. It moves when you know what your overhead really costs, when it's loaded into your bids at the right rate, and when it stops growing on its own every time you add a truck or a salary.
Where 12% ranks against 48 trades
Published net profit at $1M–$5M, across the whole benchmark reference.
| Trade | Published average | Against the target |
|---|---|---|
| SWPPP and erosion control | 10% | 2 points under |
| Electrical | 9% | 3 points under |
| Mechanical | 9% | 3 points under |
| Plumbing | 9% | 3 points under |
| Elevator | 9% | 3 points under |
| Curtain wall and glazing | 9% | 3 points under |
| Grading | 2% | 10 points under |
| Underground utility | 3% | 9 points under |
| Sitework | 3% | 9 points under |
| Demolition | 4% | 8 points under |
| Painting | 5% | 7 points under |
| Flooring | 5% | 7 points under |
All 48 trades are on the net profit page across every one of the 7 revenue bands.
- 2024 Construction Financial Benchmarker, Executive Summary, Construction Financial Management Association, 2024.
- 2025 Construction Financial Benchmarker, Executive Summary, Construction Financial Management Association, 2025.
- 2025 Performance Benchmarks, Construction Companies, Jones Maresca and Company, 2025.
- SPM Trade Benchmark Reference, Sulphur Prairie Management, LLC, 2026.
Sourcing and method: the methodology page.
Which bands are measured. The 4 bands above $10M–$25M extend the survey curve further out and have not been reconciled against the licensed CFMA Benchmarker. How every figure was built is explained on the methodology page.
The reasoning
Gross profit at the top of the range and net profit near zero is a completely normal set of books, and it means the office is eating the field. The two numbers only connect through overhead recovery, which is why net profit is a step 03 outcome and gross profit is a step 04 outcome. Fix the recovery rate and the same jobs, bid the same way, produce a different bottom line.
Monthly, on a trailing twelve, so seasonality doesn't fool you in either direction. A single strong month proves nothing and a single weak month proves nothing.
Under it. Most owners who miss this are missing it by a wide margin and are surprised by that, because revenue was up. Revenue is a multiplier. It multiplies whatever the margin already was, including a negative one.
Three moves, in order
Step 03: Overhead calculation
What indirect cost really comes to at your size, and the rate your estimating template should be using.
What is either side of this one
Contractors who hit this number
What owners ask
Average net profit margin in construction?
12%. Twelve percent is above what every one of the benchmarked trades averages. That's the point of it. It's a target, and the published averages are what happens without one. Net profit is what survives after overhead, and overhead is the number most owners have never worked out. If gross profit is a field number, net profit is an office number. It moves when you know what your overhead really costs, when it's loaded into your bids at the right rate, and when it stops growing on its own every time you add a truck or a salary.
Is 12% above what the benchmarks show?
Yes, and deliberately. Across the 48 benchmarked trades, net profit at $1M–$5M averages 7% with a published span of 2 to 10%. 0 of 48 average 12% or better. A survey average describes the population. This describes an installed business.
What moves this number?
The step is number 03, overhead calculation. What indirect cost really comes to at your size, and the rate your estimating template should be using. It's chapter 3 of CONTROL: The Construction Financial Operating System.
How do I read it?
Monthly, on a trailing twelve, so seasonality doesn't fool you in either direction. A single strong month proves nothing and a single weak month proves nothing.
What does it mean if I'm under it?
Most owners who miss this are missing it by a wide margin and are surprised by that, because revenue was up. Revenue is a multiplier. It multiplies whatever the margin already was, including a negative one.
Where do I start?
Add up every dollar that isn't a job cost for the last twelve months. That total is your real overhead, and it's usually larger than the number in your bid.
Wrote CONTROL, the 8 step system behind these figures. More about the author.