How Does Your Plumbing Business Stack Up?

Real Benchmarks to Find (and Fix) Hidden Profit Leaks

Most plumbing business owners can recite their revenue from memory — but have no idea how their operating costs compare to industry standards.

Margins shrink. Overhead creeps up. Labor absorbs more than expected. And yet the jobs keep rolling in.

In this post, we reveal six key plumbing operational benchmarks — based on national data from PHCC, ServiceTitan, IRS SOI, and others — that can help you uncover silent profit drains and course-correct fast.

Why Plumbing Benchmarks Matter

Benchmarks are your GPS. They tell you:

• Where you are
• How you compare
• Where profit may be quietly slipping away

Falling short on a single metric — like overhead, labor, or subcontractor use — can reduce margins by 3–7%. And because the impact is gradual, most operators never see it coming.

ProfitParser audits often uncover 10–30% in hidden cost savings by using these same benchmarks.

The Benchmark Dashboard: How Top Plumbing Companies Perform

We pulled national data from PHCC, IRS SOI, NAHB, ServiceTitan, Angi, and QuickBooks Benchmarks. Here's what healthy plumbing companies typically look like:

1. Gross Margin — 48%–62%

What it means: How much revenue you keep after direct job costs

Red flag: Below 50%

Watch for: Underpricing, discounting, or mis-tracked job costs

2. Labor — 25%–35% of Revenue

Includes: Tech wages, payroll tax, benefits

Over 35%? Likely due to:

• Overstaffing
• Inefficient dispatch
• Idle or non-billable time

3. Office/Admin/Overhead — 15%–25%

Includes: Admin labor, rent, software, insurance

Above 25%? You're likely carrying legacy roles, duplicated tools, or slow processes

4. Subcontractor Costs — 8%–15%

Use case: Overflow help, specialty trades

Exceeding 15%? Consider whether you could insource or negotiate better rates

5. Marketing Spend — 1.5%–4%

Includes: Google Ads, SEO, referral programs

Below 1.5%? You may be starving future growth

Above 4%? Check cost-per-lead and conversion rates

6. Net Profit Margin — 5%–15%

The final word: What you keep after all expenses

< 5% = Red flag. You're taking too much risk for too little reward

12–15%+ = Healthy — this is what strong operators achieve consistently

What Happens When You're Out of Range?

Most issues aren't obvious. They're slow leaks. Here's what we see most often:

• Labor inefficiencies: Idle techs, overtime, poor routing
• Vendor bloat: Old contracts with outdated rates
• Pricing inertia: Flat prices while costs rise
• Admin drag: Too many tools or unclear roles
• Marketing inefficiency: Big spend, poor return

Every 1% off on labor or subs equals $20K–$50K in lost annual profit for a $5M business.

What You Can Do This Week

Run a Quick Ratio Check:

Compare your trailing 12-month P&L to the ranges above

Highlight Red Flags:

Look for outliers or "I’m not sure" answers

Prioritize 1–2 Fixes:

Focus first on labor, subs, or overhead — they yield the fastest ROI

Want help?

That’s exactly what our Free OPEX Opportunity Assessment is for.

Don’t Let Profit Slip Away

You don’t need to change your team, tools, or territory.

You just need to look under the hood.

And when you do, we’re here to help.

Request a Free OPEX Opportunity Assessment

Discover where you're leaving 10–30% of profit on the table — and how to get it back, fast.