What’s Your Target Gross Margin vs. Actual Net Margin? Let’s Benchmark.
In home services and contracting, top-line revenue gets all the attention, but net profit pays the bills. Many trade operators aim for a 40–50% gross profit margin to retain a healthy 15–20% net margin, but actual figures vary significantly based on team size and trade complexity. A standard healthy benchmark breakdown often looks like: Cost of Goods Sold (Direct Labor + Materials): 50–60% of revenue Overhead & Operating Expenses: 25–30% of revenue Net Profit Target: 15–20% of revenue I’d love to benchmark with the community: Are you hitting your target net margins consistently as you scale, or is overhead creeping up faster than revenue? Where are you seeing the biggest pressure on your margins today?Those who charge for inspections, do you have a flat rate or does it depend on the porperty?
I recently got a request for a rodent assessment for a house that is about 10,000 sqft, an absolute monster of a house with 6 levels, a 4 car garage (buddy has a McLaren 750S, Porsche 917, Ford GT and a Range Rover!!!), vehicle lifts, elevator, separate chef kitchen, indoor pool...the works! I told the homeowner my standard fee for a more modest sized house, and that I would have to triple that to be able to spend the time at their home and not feel rushed. They did agree and made no issue out of it but it did make me wonder how other people approach this. Then I found the issue areas and they were about 3-4 times as many as a regular house and the cost reflected that. More doors, vents, cracks, holes, utility lines...it was insane. Should I have kept the inspection charge the same knowing I would find many many more holes or was it smart to up the inspection charge?Are You Building a Business or Just Creating Yourself Another Job?
It’s easy as a small business owner to get caught up doing everything yourself. At what point do you start delegating, hiring, or putting systems in place so the business can operate without you being involved in every job? I’d love to hear how other owners are making that transition while still keeping quality and customer service high.
💡FEATURE REQUEST: Price Increases in Products & Services List
Do you increase prices for ongoing customers? Do you know how long it takes me to increase my prices for 700 ongoing clients in my cleaning business? Whether you increase your prices on an annual basis or just as needed in these unpredictable times, it would be easier to make these changes en masse in the Products and Services tab! How would it work? When editing a product or service line item in the Products & Services List, there should be an option to carry that modification over to any existing Jobs that have that line item on it. Currently, this would only update for new jobs created, but I'd love to see a little pop-up that says, "Would you like to change the price for existing Jobs with this line item? Yes/No" Use Case Example: Because I am in the cleaning industry, it will be my primary use case. Let's say you have a minimum price that every client's rate will be at or above. When you create a new job for a recurring customer, you add a line item titled "Minimum Rate + current year," like for 2020: "Minimum Rate 2020," which is $150. You also add another line item based on how your pricing model is set up - in this case, I will use a simple one: "Small House" for $10 "Medium House" for $30 "Large House" for $50 When it's time for your prices to increase, consider the following options: you could decide to raise prices only for people with large houses and keep your minimum rate the same, or you may want to increase the cost for clients who have been with you for more than 5 years. Instead of making this change one client at a time and trying to sort through who the change applies to, I could go to the Products and Services List and find the specific line item I want to modify. Then, I could edit the price in there! Ta Da! You've raised your prices! Why should Jobber care? This would be huge for any business industry that has recurring clients. ServiceTitan, Housecall Pro, and other competitors already have this feature. I have found other threads that mention something like this or frustrations with how to go about raising prices. This would allow businesses that only see customers once or twice a year to set up their customers as recurring with one Job, saving them a lot of time and effort as well. You'd have at least one very loyal customer in me! I've spoken to two support agents who thought this was a simple but fantastic idea! My next price increase is in June, and I'd love you guys if you saved me weeks worth of work in a single click 🤞🙏 QUESTIONS, COMMENTS, FEEDBACK, AND MORE USE CASES WELCOME!!Has anyone here been a Jobber Grant recipient? I’d love to learn from your experience.
Good morning, everyone! I recently completed my Jobber Grant application, and regardless of the outcome, I’m grateful for the opportunity and everything I’ve already learned through this community. I was curious if anyone here has been selected as a Jobber Grant recipient in previous years. If so, I’d love to hear about your experience. How did receiving the grant impact your business? What investments made the biggest difference? Were there any lessons you learned after receiving the funding that you wish you had known beforehand? I believe hearing real success stories can help all of us prepare for future growth, whether we’re selected this year or not. Thank you in advance for sharing your journey!
How do contractors price jobs based on actual business costs instead of competitor rates?
We run a contracting business in Juneau, Alaska. It’s a remote town with no roads in or out, so our market does not work like most places. Lead generation is not our problem. The work is there. Our bigger challenge is filtering demand, choosing the right jobs, and pricing from the actual cost of running the business instead of just asking, “what does everyone else charge?” That has changed how we look at pricing. Two companies can do the same job with completely different numbers behind it: equipment payments, fuel, insurance, payroll, repairs, debt, admin time, material costs, disposal, taxes, and risk. Competitor pricing matters, but only to a point. If our cost structure is different, their price can’t be our whole pricing strategy. We have a CPA and bookkeeper we trust, so the books are not something we’re guessing on. What we’re working on now is turning the P&L and balance sheet into real-world pricing decisions: what the equipment needs to bill, what materials need to carry, what minimums make sense, and which jobs are actually worth putting on the schedule. We’ve also been using AI to organize that information into pricing structures, quote templates, equipment rates, per-ton pricing, material pricing, and job-type frameworks. To be clear, we’re not using AI to tell us what to charge. We’re using it to organize what we already know, pressure-test assumptions, run simulations, and find holes before they show up in the bank account. The more we work through it, the more we wonder how often underpricing comes from not having a clear link between pricing and the actual cost of running the business. Curious how others think about this. When you price work, do you start with your own numbers first, the market first, or a mix of both? For those using AI, have you used it for pricing, estimating, job costing, or financial review beyond emails and marketing content?How Understanding Gross Profit Changed My Business
For a long time, I thought I was doing everything right. Work was coming in, the crew stayed busy, and the revenue numbers looked solid. But every month I was stressed about money and I couldn't figure out why. It wasn't until I really sat down and looked at my numbers that things started to click. I came across Tom Reber's work, and it completely changed the way I thought about pricing. The biggest thing I took from it was understanding gross profit — not just revenue, not just what a job "feels like" it's worth, but what's actually left after you pay for labor and materials. Once I understood that number, I realized I had been leaving a lot of money on the table for years. What I Learned Gross profit is the money left from a job after you cover your direct costs — labor and materials. That number has to be healthy enough to cover everything else it takes to run your business: your truck, insurance, tools, software, your time. If your margin is too thin, all of that comes out of your pocket and you never get ahead. For me, setting a clear gross profit goal on every job was the turning point. It gave me something to price toward instead of just guessing and hoping it worked out. What Changed I stopped pricing jobs to win them and started pricing them to actually make money on them. Some bids I lost. But the ones I won started feeling worth it. Cash flow got easier. I could actually see where the money was going — and more importantly, where it was staying. It wasn't an overnight fix, but getting honest about my numbers was the first step to building a business that felt sustainable instead of just busy. If you've been in that same spot — working hard, staying booked, but still wondering where the money went — start by looking at your gross profit on every job. It might surprise you.
