"Is my margin any good?" is one of the most common questions trade owners ask — and one of the hardest to answer with a single number. Margins vary by trade, job type, region, and how you account for labor. But there are realistic ranges, and knowing them helps you spot whether you are pricing for profit or just staying busy.
First, know which margin you mean
Two very different numbers both get called "margin":
- Gross margin: revenue minus direct job costs (labor and materials), divided by revenue. It tells you how profitable the work itself is.
- Net margin: what is left after gross profit also covers overhead — rent, insurance, vehicles, office staff, software. It is what the business actually keeps.
A shop can have a healthy 45% gross margin and a thin 6% net margin if overhead is bloated. Always be clear which one you are comparing.
Typical ranges in the trades
These are general industry ballparks, not guarantees — your numbers depend on your market and cost structure.
| Trade | Typical gross margin | Typical net margin |
|---|---|---|
| HVAC | ~40–50% | ~8–15% |
| Plumbing | ~40–55% | ~10–18% |
| Electrical | ~35–50% | ~8–15% |
Service and repair work usually carries higher margins than large installs, where materials make up a bigger share of the ticket and competition is fiercer.
Why your margin might look better than it is
Most contractors overestimate their margins because they cost labor at the raw wage instead of the burdened rate, and they forget to allocate overhead to each job. Fix those two things and the "great margin" job often turns out to be average — and a few jobs turn out to be losers.
What actually moves your margin
- Pricing discipline: consistent markups beat one-off guesses.
- Labor efficiency: billable-hour ratio and drive time per job.
- Material markup: small slippage on parts compounds across hundreds of jobs.
- Callbacks and rework: the silent margin killer.
- Job mix: doing more of your high-margin work and less of the rest.
How to know if your margins are healthy
The benchmark that matters most is your own trend. If net margin is climbing quarter over quarter and you can pay yourself a real wage on top of net profit, you are in good shape. If revenue is growing but net margin is flat or falling, you are buying yourself a busier, riskier job — not a more profitable business.
Final takeaway
Aim to know your gross and net margin by job type, not just for the business overall. Industry ranges are a sanity check; your job-level data is the real story. The contractors who win are not always the ones charging the most — they are the ones who actually know their numbers.
Know your margin on every job
MarginMate shows gross margin per job and across your week, so you can compare job types and price with confidence.