Where fire protection contractors lose money
6 things cost fire protection contractors money without ever becoming a line item, and each one traces to a step you can install. Fire protection contractors average 23% gross margin, 15% overhead and 8% net profit at $1M to $5M of revenue. The CFOS target at that size is 25.5% gross margin, 14% overhead and 11.5% net, and the 3.5 points left on the table is where those mechanisms live. Figures for all 7 revenue bands are in the table below.
Fire protection ranks 4th of 7 in mechanical and life safety on net profit, and it has leaner overhead than the 48-trade average. Here is every figure, across all 7 revenue bands.
Run On CFOS publishes the full benchmark reference: 48 trades across all 7 revenue bands, $1M to $500M and above. The 4 bands above $25M are modeled and labeled that way in every table, and no CFOS target is published for them. Run On CFOS computes net profit as gross margin minus overhead, before taxes.
Fire protection by revenue band
| Metric | $1M to $5M | $5M to $10M | $10M to $25M | $25M to $50MModeled | $50M to $100MModeled | $100M to $500MModeled | $500M+Modeled | CFOS target at $1M to $5M |
|---|---|---|---|---|---|---|---|---|
| Overhead | 15% | 14% | 13% | 12% | 11% | 10% | 9% | 14% |
| Gross margin | 23% | 25% | 26% | 27% | 28% | 30% | 31% | 25.5% |
| Net profit | 8% | 11% | 13% | 15% | 17% | 20% | 22% | 11.5% |
| Metric | $1M to $5M | $5M to $10M | $10M to $25M |
|---|---|---|---|
| Overhead | 14% | 13% | 12% |
| Gross margin | 25.5% | 27.5% | 28.5% |
| Net profit | 11.5% | 14.5% | 16.5% |
Modeled extension of the survey curve, not reconciled against the licensed CFMA Benchmarker. That applies to the 4 bands above $10M to $25M, and no CFOS target is published for them.
Gross margin and overhead come from figures CFMA, Jones Maresca and other sources publish by trade and size. Net profit is computed, not surveyed: net profit = gross margin minus overhead. Nothing comes out for taxes, interest or other income and expense, so it is a before tax figure, on the same basis as CFMA's net income before taxes.
CFMA's 2025 medians are 7.1 percent before interest and taxes and 6.7 percent net income before taxes. Gross margin minus overhead leaves out interest and other income and expense, so a figure here can come in a little above or below a reported net income on the same business.
Above the $10M to $25M band the gross margin and overhead rows are a modeled extension of the same curves. They have not been reconciled against the licensed CFMA Benchmarker, so read those bands as a model and not as a survey result.
Run On CFOS. Run On CFOS Trade Benchmark Reference: Fire protection. 2026. Sulphur Prairie Operations, LLC. https://runoncfos.com/trades/fire-protection. 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 come from figures CFMA, Jones Maresca and other sources publish, and Run On CFOS computes net profit from them: net profit = gross margin minus overhead, before taxes. The CFOS targets beside them are from the book CONTROL: C.F.O.S. Construction Financial Operating System, published with the full reference at runoncfos.com.
- 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.
- Run On CFOS Trade Benchmark Reference, Sulphur Prairie Operations, LLC, 2026.
Sourcing and method: the methodology page.
Which bands are measured. The 4 bands above $10M to $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.
Use these numbers on your own jobs
CFOS for QuickBooks grades your own books against the fire protection figures above, every month. At $1M to $5M, the published average net profit is 8% before taxes and the CFOS target is 11.5%.
Under $10M. You see which jobs made money while they are still open, so you can fix a fire protection job before it closes. From $10M to $50M. The controller gets a WIP that ties to QuickBooks Online, with each project manager's cost to complete approved every month.
6 problems specific to fire protection
You cut the pump deposit check in March and the truck backs in the next January, and every month in between your money is out with nothing on the pay app. The engineer wrote one line on the drawings and you're the one drafting it, stamping it, and defending it to two reviewers who don't answer to each other. You're buying pipe off a number you wrote eight months ago, and there's no second brand to call when the mill price jumps. The lead-in you installed before the slab is still holding your retention, and it releases the day a fire marshal watches a test you can't schedule on your own.
Each one below points at the item, the unit, the clock, or the party that makes it a fire protection problem, and it says which step fixes it.
| Mechanism | Why it's specific to this trade | Step |
|---|---|---|
| The Pump Can't Be Ordered Until The AHJ Signs The Calc | Plenty of trades buy long lead gear. Fire protection is the only one whose single biggest equipment buy falls legally downstream of a third party's plan review, because a fire pump is a listed package sized off an approved calc: pump, controller, jockey pump, sensing line, and sometimes a diesel driver and day tank. A framer can buy studs the week he needs them. You're writing a six figure deposit against a drawing a fire marshal hasn't commented on yet. | Monthly cadence |
| You Stamped The Drawings, So You Own Both Review Clocks | Delegated design makes you the designer of record on a system you also install, which turns the drafting table into a production department here and a convenience everywhere else. FM Global and highly protected risk reviewers apply rules tighter than code, so clearing the fire marshal doesn't mean you're cleared. No other trade on the building needs two independent approvals before the first stick of pipe gets cut. | Project management |
| Sprinkler Pipe Has No Substitute When The Price Moves | Most trades answer a price spike by switching brands or proposing an equal. Listing and approval rules take that move off the table here, because a coupling that isn't listed for fire service isn't a coupling you're allowed to install. The jobs you pursued hardest, the long institutional ones, have the widest spread between the day you priced pipe and the day you buy it. | Estimating system |
| The Fire Marshal Releases Money You Earned Two Years Ago | No other trade spans the building like this. The concrete sub is off the site before your overhead rough starts and his retention ages against a milestone he controls. Yours ages against a witnessed test that another contractor's open punch item can hold up indefinitely, on money you earned before the building had walls. | Software and bookkeeping alignment |
| Five Mobilizations Share One Lump Labor Budget | A painter comes back twice and the second trip looks a lot like the first. Your fifth trip is trim work at height in a finished space with the GC counting days to the certificate of occupancy, and it works nothing like the rough. Your pipe is fabricated to a drawing, so a ceiling change that's a shrug for other trades scraps steel you've already paid for and already grooved. | Job cost structure |
| A Freeze Event Happens A Year After Final Payment | Your warranty exposure is measured in seasons, because the failure mode needs weather before it will turn up. When it does, water discharges into a finished building, so a small defect in your work turns into a large claim against somebody. No other trade's callback starts a fire watch meter while the phone is still ringing. | Overhead calculation |
Fire protection against the other 47 trades
| Metric | Fire protection | Mechanical and life safety average | All 48 average | Rank |
|---|---|---|---|---|
| Overhead | 15% | 16.1% | 15.1% | 17th of 48 |
| Gross margin | 23% | 24.6% | 22.1% | 13th of 48 |
| Net profit | 8% | 8.4% | 7% | 8th of 48 |
Fire protection sheds 6 points of overhead between $1M to $5M and $500M+, against 6.3 for mechanical and life safety as a group. Inside that group, Mechanical, Plumbing and Elevator all keep 9%, the most in the group, and Fire protection has the leanest overhead at 15%. The leanest one is this trade.
Other mechanical and life safety trades
What owners ask
What overhead should a fire protection contractor have?
Fire protection shares its overhead figure with 14 other trades at this revenue, which is what the published data resolves to. It averages 15% at $1M to $5M and 9% at $500M+, as a percentage of revenue. That is 1.1 points below the mechanical and life safety average of 16.1%. The CFOS target at $1M to $5M is 14%. The CFOS target is one point leaner than your trade's industry average at your revenue.
What gross margin should a fire protection contractor have?
Fire protection shares its gross margin figure with 6 other trades at this revenue, which is what the published data resolves to. It averages 23% at $1M to $5M and 31% at $500M+, as a percentage of revenue. That is 1.6 points below the mechanical and life safety average of 24.6%. The CFOS target at $1M to $5M is 25.5%. The CFOS target recalculates at your revenue: whatever gross margin produces the net profit target once overhead is paid, never below your trade's own industry average.
What net profit should a fire protection contractor have?
Fire protection shares its net profit figure with 12 other trades at this revenue, which is what the published data resolves to. It averages 8% at $1M to $5M and 22% at $500M+, before taxes, gross margin minus overhead, as a percentage of revenue. That is 0.4 points below the mechanical and life safety average of 8.4%. The CFOS target at $1M to $5M is 11.5%. The CFOS target recalculates at your revenue: 10 percent before taxes, or 3.5 points better than your trade's industry average, whichever is higher.
What profit margin should a small fire protection business have?
Owners usually mean net profit when they say profit margin, and for fire protection at $1M to $5M that's 8%. Gross margin is a different number, 23%, and it's what's left after job costs but before overhead. Overhead is the 15% between the two. A small fire protection business holding 8% net is at the published figure for its size, and the CFOS target at that revenue is 11.5%.
Does fire protection get more profitable as it grows?
Overhead is the number that moves. Fire protection sheds 6 points between $1M to $5M and $500M+, which is in line with the 6.3 points mechanical and life safety sheds as a group. Net profit is already above the 48-trade average, so the room is in holding it while revenue rises.
Where does fire protection rank against the other trades?
Fire protection ties 3 trades in mechanical and life safety on net profit, all at 8%. Mechanical, Plumbing and Elevator are the most profitable at 9%. It also has the leanest overhead in the group. Gross margin ranks 13th of 48 and overhead ranks 17th.
That's the industry average and the CFOS target for fire protection at every size. Want your own books set beside them? The Financial Health Snapshot builds a CEO Report from your last twelve months, sets every figure against your trade, and walks you through it on a 60 minute call. SPM The Construction CFO (Sulphur Prairie Management, LLC) is a separate firm, and the same author leads it.
Everything on this page is something you can install yourself, and CONTROL is the order to do it in. If you would rather buy the finished result, SPM The Construction CFO does this work for fire protection contractors as a service. It is a separate firm, Sulphur Prairie Management, LLC, led by the same author.
Wrote CONTROL, the 8 step system behind these figures. More about the author.