Where landscaping contractors lose money
10 things cost landscaping contractors money without ever becoming a line item, and each one traces to a step you can install. Landscaping contractors average 22% gross margin, 15% overhead and 7% net profit at $1M–$5M of revenue. The CFOS target at that size is 24.5% gross margin, 14% overhead and 10.5% 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.
Landscaping ranks 1st of 2 in landscape and irrigation on net profit, and it has leaner overhead than the 48-trade average. Here is every figure, across all 7 revenue bands.
Landscaping by revenue band
| Metric | $1M–$5M | $5M–$10M | $10M–$25M | $25M–$50MModeled | $50M–$100MModeled | $100M–$500MModeled | $500M+Modeled | CFOS target at $1M–$5M |
|---|---|---|---|---|---|---|---|---|
| Overhead | 15% | 14% | 13% | 12% | 11% | 10% | 9% | 14% |
| Gross margin | 22% | 23% | 24% | 25% | 26% | 27% | 29% | 24.5% |
| Net profit | 7% | 9% | 11% | 13% | 15% | 17% | 20% | 10.5% |
| Metric | $1M–$5M | $5M–$10M | $10M–$25M |
|---|---|---|---|
| Overhead | 14% | 13% | 12% |
| Gross margin | 24.5% | 25.5% | 26.5% |
| Net profit | 10.5% | 12.5% | 14.5% |
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 CFMA, Jones Maresca and SPM's own trade data, because those are the figures those sources report by trade and size. Net profit is calculated from them as gross margin minus overhead, so the three rows tie. That makes it an operating profit figure: what is left before interest, other income and expense, and the tax planning choices owners make, such as bonuses, depreciation methods and retirement contributions.
Surveys report net income before taxes after those items, so a reported net can run below the figure here. At the typical contractor the difference is small: CFMA's 2025 medians are 7.1 percent before interest and taxes and 6.7 percent net income before taxes. It grows with size. Against the separate measured net profit dataset, the calculated net runs 0.8 points higher at $1M to $5M, 2.2 points at $5M to $10M and 3.5 points at $10M to $25M, because the gross margin and overhead rows change faster with size than reported net profit does.
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, and the calculated net there runs well above survey medians, so read those bands as a model and not as a survey result.
SPM The Construction CFO. SPM Trade Benchmark Reference: Landscaping. 2026. Sulphur Prairie Management, LLC. https://runoncfos.com/trades/landscaping. 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.
- 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.
10 problems specific to landscaping
Every head is in the ground, the trenches are closed, and you can't pressurize a thing because the water purveyor hasn't set the meter yet. The pump station quotes in quarters and the vendor wants 30 to 50 percent at release, months before the job produces a single dollar of billing. Fifteen percent of your material goes under the pavement early and bills as three percent of a pay application, because the whole scope rides on one schedule of values line. A 3 to 4 inch caliper shade tree is 8 to 12 years in a field, so when the regional growers are short there's no rush fee that fixes it.
Each one below points at the item, the unit, the clock, or the party that makes it a landscaping problem, and it says which step fixes it.
| Mechanism | Why it's specific to this trade | Step |
|---|---|---|
| The meter set you don't control ends your job | Every other sub's long lead risk is a purchase order they signed and can chase with a phone call. Yours is a utility action with no promise date, and it falls directly between finished work and every acceptance test in the spec. No other trade needs a stranger's crew to come out to the site before its own installed work can even be tested. | Project management |
| A 22-week pump skid wants half down before you bill | Most trades' long lead gear is catalog product with a stocking distributor behind it and a resale market if the job dies. A VFD panel and a made-to-order skid have neither, so the deposit is a real commitment to one project before that project has proven anything. Worse, deposits usually get coded to a vendor expense, so the job reports a healthy margin in the same month your bank balance drops. | Job cost structure |
| Sleeving goes in month two and bills like nothing | A trade that installs once, in sequence, can live with a single percent-complete line because its cost burns evenly. Your cost front-loads with buried pipe that can't be inspected, and then it repeats four more times across eighteen months of schedule. Percent complete on one line assumes a straight burn, and irrigation doesn't burn straight. | Job cost structure |
| The tree can't be expedited at any price | Manufactured material has a factory that can run overtime when a job gets hot. Your material is a living crop on a growing-season clock, and the binding constraint is the specified cultivar at the specified caliper, which money doesn't move. A closed dig window costs you a season, while every other trade's expediting problem costs them a premium. | Estimating system |
| Your establishment clock starts when they walk it | Most warranty periods start at substantial completion, a date the GC has every incentive to declare fast. Yours starts at a discretionary walk by a design professional or contracting officer with no schedule pressure at all, and you keep watering the work while you wait for the clock to begin. Those weeks are unbilled crew time on a job already reported at completion. | Project management |
| An October plant list meets a September price book | Steel and copper escalation arguments run off a public index both sides can read. Your exposure is living inventory plus trucking, with no index, no futures market, and a price book that resets on a growing season. On a job bid 12 to 18 months before buyout, the plant and bulk lines absorb the entire move by themselves. | Estimating system |
| Retention is held a year while you still send a truck | For everyone else, retention is a financing cost with nothing operational behind it. Yours has a crew, a truck, and replacement material attached to it for twelve straight months, so the job keeps consuming cash long after you closed it in your reporting. The bond line stays committed that whole period too, and that's the same capacity you need for the next bid. | Job cost structure |
| You're the first trade on site and the last one off | A trade that installs once and turns the area over can defend its work at a single walkthrough. Your finished product lies at grade where everyone parks, and it stays vulnerable for months. Backcharges for damage to landscaping are the hardest thing to get a GC to accept, because everybody on that job assumes the grass was getting replaced anyway. The repair ends up on your punch list and never on a change order. | Job cost structure |
| You write February checks for a crew that starts in May | Other trades add headcount when the work starts and pay for it out of that work. Your labor supply runs on a federal filing calendar with a lottery attached, and your material has to be reserved on a grower's schedule, so both get committed a full quarter before any revenue exists. You fund the hole out of last season's maintenance revenue, which is at its thinnest in that same month. | Monthly cadence |
| Your seed has to germinate before anyone gets paid | Every other sub's final payment depends on installed quantities an inspector measures once and signs off on. Yours depends on living cover reaching a percentage, on a permit the GC holds and you can't close, after a summer that either cooperated or didn't. No other trade's retention is parked behind whether it rained in September. | Project management |
Landscaping against the other 47 trades
| Metric | Landscaping | Landscape and irrigation average | All 48 average | Rank |
|---|---|---|---|---|
| Overhead | 15% | 15% | 15.1% | 17th of 48 |
| Gross margin | 22% | 22% | 22.1% | 20th of 48 |
| Net profit | 7% | 7% | 7% | 21st of 48 |
Landscaping sheds 6 points of overhead between $1M–$5M and $500M+, against 6 for landscape and irrigation as a group. Inside that group, Landscaping and Irrigation all keep 7%, the most in the group, and Landscaping and Irrigation all run 15% overhead, the leanest. This trade is one of them on both counts.
Other landscape and irrigation trades
What owners ask
What overhead should a landscaping contractor run?
Landscaping shares its overhead figure with 14 other trades at this revenue, which is what the published data resolves to. It averages 15% at $1M–$5M and 9% at $500M+, as a percentage of revenue. That's level with the landscape and irrigation average. The CFOS target at $1M–$5M is 14%. The CFOS target is one point leaner than your trade's industry average at your revenue.
What gross margin should a landscaping contractor run?
Landscaping shares its gross margin figure with 12 other trades at this revenue, which is what the published data resolves to. It averages 22% at $1M–$5M and 29% at $500M+, as a percentage of revenue. That's level with the landscape and irrigation average. The CFOS target at $1M–$5M is 24.5%. 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 landscaping contractor run?
Landscaping shares its net profit figure with 16 other trades at this revenue, which is what the published data resolves to. It averages 7% at $1M–$5M and 20% at $500M+, before taxes, as a percentage of revenue. That's level with the landscape and irrigation average. The CFOS target at $1M–$5M is 10.5%. 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 landscaping business run?
Owners usually mean net profit when they say profit margin, and for landscaping at $1M–$5M that's 7%. Gross margin is a different number, 22%, and it's what's left after job costs but before overhead. Overhead is the 15% between the two. A small landscaping business holding 7% net is at the published figure for its size, and the CFOS target at that revenue is 10.5%.
Does landscaping get more profitable as it grows?
Overhead is the number that moves. Landscaping sheds 6 points between $1M–$5M and $500M+, which is in line with the 6 points landscape and irrigation sheds as a group. Net profit starts 0 points under the 48-trade average, so the room is in the overhead line before it's anywhere else.
Where does landscaping rank against the other trades?
Landscaping ties 1 trade in landscape and irrigation on net profit, all at 7%. Nothing publishes more, and Irrigation matches it. Its overhead is the leanest too, level with Irrigation. Gross margin ranks 20th of 48 and overhead ranks 17th.
That's the industry average and the CFOS target for landscaping 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 runs it.
Everything on this page is something you can install yourself, andCONTROL is the order to do it in. If you would rather buy the finished result, SPM The Construction CFO does this work for landscaping contractors as a service. It is a separate firm, Sulphur Prairie Management, LLC, run by the same author.
Wrote CONTROL, the 8 step system behind these figures. More about the author.