Gross profit and net profit
Gross profit is sales less the direct costs of the work: parts, paint and materials, sublet, and usually the technicians who did it. Net profit is what's left after the overheads as well: rent, the office, insurance, equipment and everything else.
Shops don't all draw the gross profit line in the same place. Put technicians' pay and benefits above it (“loaded”) and gross profit is lower; put them below it with the overheads (“unloaded”) and it's higher. In one consultant's example, the same shop's total gross profit was about 45% to 50% unloaded and 36% to 40% loaded, and its labor gross profit 63% unloaded against 38% to 40% loaded.
What shops report
The newest broad survey is FenderBender's 2026 industry survey: 300 shops, almost half of them independent single locations, surveyed between February and April 2026. It reports the most common answer, not an average:
Overall gross profit
40% to 49%
The most common answer, from 32% of shops.
Net profit
6% to 10%
The most common answer, from 40% of shops.
Average repair order
$2,000 to $2,999
The most common answer, from 26% of shops.
Consultants' figures give a sense of the targets shops aim for:
- PPG's business consultant Steve Trapp: at least 45% gross profit, with top shops at about 50%.
- Paint and materials have historically been about 10% of a shop's sales, or 8% to 9% where a shop sublets a lot of calibration work (Mike Anderson, 2023).
- $65,000 to $75,000 in sales per body technician a month (Mike Anderson, 2024).
How a big consolidator compares
Boyd Group, which owns Gerber Collision & Glass, is the one large US collision operator that publishes its results. Caliber, Crash Champions and Classic are private.
| Period | Sales | Gross margin | Operating costs | Adjusted EBITDA |
|---|---|---|---|---|
| 2025 | $3.14 billion | 46.4% | 34.4% of sales | 12.0% |
| Second quarter of 2026 | $1.01 billion | 47.4% | 33.9% of sales | 13.4% |
From Boyd's results. Its EBITDA comes before lease costs under its accounting rules (right-of-use depreciation alone was 4.3% of sales in the second quarter of 2026), so don't compare it directly with the profit of a shop that pays rent.
Two things stand out. Insurers pay 96% of Boyd's revenue, so its margins are made on insurance work. And its gross margin rose in 2025 mostly on purchasing: parts and paint margins improved, and it moved scanning and calibration in-house for 75% of its US work, lifting its sublet margins. Its stated goal is an adjusted EBITDA margin of 14% or more.
Margins by category
We found no current survey of gross profit by category, so work out your own. Here's the repair from our job costing guide, as estimated, with technicians' pay above the line:
| Category | Billed | Cost | Gross profit |
|---|---|---|---|
| Labor | $1,513.60 | $754.40 | 50.2% |
| Parts | $1,500.00 | $1,125.00 | 25.0% |
| Paint and materials | $252.00 | $170.00 | 32.5% |
| Sublet: calibration | $360.00 | $300.00 | 16.7% |
| Towing | $150.00 | $150.00 | 0.0% |
| Whole repair | $3,775.60 | $2,499.40 | 33.8% |
A made-up repair, before sales tax. Labor's cost is the technician's pay with payroll taxes and benefits, so this is loaded gross profit.
Each category earns differently, so the mix of work matters as much as any one margin: a month heavy on parts-intensive replacement work shows a lower overall gross profit than one heavy on repair labor. Our parts and paint pricing guide covers how each is priced.
What's moving margins in 2026
| Area | What the latest figures show |
|---|---|
| Labor | Labor rates on insurance estimates rose 2.9% in 2025 and 1.5% year over year by mid-2026 (CCC), and some insurers cut theirs. More damaged parts are being repaired rather than replaced: 15.5% in 2025, the first rise in over a decade (Enlyte) |
| Parts | Prices per part rose 6% in 2025 and about 8% year over year in early 2026, with tariffs a factor (CCC). Aftermarket parts reached a record 22.7% of parts spending |
| Paint and materials | Only 20% of shops say insurers always or usually pay blend time, down from 40%. 56% now have painters feather, prime and block, which a consultant links to better materials margins |
| Calibrations and sublet | Calibrations were on 34.7% of estimates in 2025, averaging $688 (Enlyte). Bringing them in-house turns a sublet margin into labor |
| Volume | Repairable claims fell 9.7% in 2025. Through September 2026, claims were down 3.5% and repairable estimates 5.4%, with total losses at 23.5% of claims (CCC) |
| Who pays | Customer-pay jobs were 26% of repair orders in the first half of 2026, averaging $1,941, and 28.4% of repairable collision claims carried a deductible of $1,000 or more (CCC) |
Where to look when margins slip
When margins slip, the leak is usually one of these:
- Work done but not billed. Not-included operations, judgment time and hidden damage that never made it onto a supplement. Our supplements guide covers what to add.
- Parts missing from repair orders. One consultant found shops whose management system showed a 33% parts margin while their accounts showed 23% to 24%, because parts weren't all added to repair orders. Chase returns and credits too.
- Shop supplies counted as paint. Seam sealer, clips and safety gear in the paint bill make materials margins look worse than they are, and hide what supplies really cost.
- Hours lost. Jobs that run over the estimate, technicians waiting on parts or approvals, and comebacks: every one costs labor and bay time.
- The wrong rates. A labor rate that hasn't kept up with your costs, or work taken at rates that don't cover them. Our labor rate guide works out what yours needs to be.
The market in numbers
Body, paint and interior shops
35,252
Businesses with employees in 2025 (BLS); dealer body shops are counted as dealers.
Average repairable claim
$4,821
In the first half of 2026, up 0.6% (CCC).
The US collision market
About $58 billion
Boyd Group's own estimate, September 2026.
Consolidation keeps going: by Boyd's count, the five largest operators held about 17% of locations, and Gerber's purchase of Joe Hudson's 258 shops in January 2026 turned the “Big Five” into a Big Four. Independent shops still make up most of the industry, and most of their margin comes down to the basics above.
GuideHow to set your auto body labor rateTechnician cost, the hours you can sell, overheads and profit, step by step.
