Insulation profit margin benchmarks
The IRS reports what one-owner businesses filing Schedule C earn, by sector. Insulation falls under Specialty trade contractors. For tax year 2023, 2,521,516 returns reported $257.8 billion in receipts, $80.4 billion in cost of sales and $40.5 billion in net income less deficit (the table gives thousands of dollars):
| Benchmark | Value |
|---|---|
| Gross margin | 68.8% |
| Net margin, owner pay included | 15.7% |
| Average receipts per return | $102,220 |
| Average net income per return | $16,054 |
The owner's own draw is not an expense on a Schedule C, so that net margin is mostly the owner's wage, not profit on top of it.
Where the money goes in insulation
Insulation is material and labor with low equipment cost for blown-in and batts, and a large machine cost for spray foam. Prep and air sealing take time that is often not quoted.
Where insulation margin leaks, and how to win it back
- Air sealing done free
- Old insulation removal left off
- Attic access problems found on the day
- Spray foam waste and overspray
- Machine downtime
Ways insulation contractors raise margin: price air sealing as its own line; charge for removal of old insulation; sell attic and crawl space together; check access before quoting.
Check your insulation prices against the costs
The typical national prices from our sourced calculators are a check on whether your prices leave room for margin:
| Service | Typical | Range |
|---|---|---|
| Blown-in insulation | $1.66 | $0.75 to $2.73 a sq ft |
| Batts or rolls | $1.52 | $0.90 to $2.39 a sq ft |
| Old insulation removal | $1.25 | $1.00 to $1.50 a sq ft |
| Closed walls, drill and fill | $2.00 | $0.75 to $3.25 a sq ft |
| Spray foam, open-cell | $3.50 | $2.00 to $5.00 a sq ft |
| Spray foam, closed-cell | $4.15 | $2.50 to $5.80 a sq ft |
Work out the margin on each line of your menu, not just the big jobs. The usual insulation menu: blown-in insulation; batts or rolls; old insulation removal; air sealing; closed walls, drill and fill; spray foam, open-cell; spray foam, closed-cell; rigid foam board; crawl space encapsulation; rim joist sealing.
Overhead comes out of the margin before profit. In insulation it includes general liability insurance, which Insureon's customers who are contractors as a group pay an average of $83 a month for; commercial auto at $270 a month on the same figures.
Work out your own margin
Put one recent insulation job into the calculator above, or switch it to "My margin for the year" to set your year next to the IRS benchmark. A 50% markup is a 33% margin; the markup calculator shows the rest.
Sources
- IRS Statistics of Income: Nonfarm sole proprietorships, Table 2, income statements by industrial sector, tax year 2023, checked October 9, 2026
- IRS: SOI tax stats, nonfarm sole proprietorship statistics, checked October 9, 2026
- Insureon: Insurance cost for contractors as a group, checked October 9, 2026
- ENERGY STAR, recommended home insulation R-values, checked October 8, 2026
- Bob Vila, attic insulation cost, checked October 8, 2026
- This Old House, spray foam insulation cost, checked October 8, 2026
- Fixr, home insulation cost, checked October 8, 2026
- Thumbtack, insulation cost, checked October 8, 2026
- HomeAdvisor, insulation cost, checked October 8, 2026
- BLS Occupational Employment and Wage Statistics, May 2025 (state and national files), checked October 8, 2026
- US Census Bureau, 2020 ZIP Code Tabulation Area to county relationship file, checked October 8, 2026
Last checked October 9, 2026. This page is general information, not legal or tax advice. Rules change and differ by state and city, so confirm with the agency named before you act.