Gross Margin Benchmarks for 2025: What’s Normal in Your Industry?

Discover 2025’s gross margin benchmarks by sector. Learn how your business compares and why benchmarking your margins is critical for strategic growth.
May 2, 2025
Gross Margin
gross margin benchmarks

Understanding your gross margin is crucial — but knowing how it compares to industry standards is even more powerful.

In this guide, we reveal projected gross margin benchmarks for 2025 across key sectors, helping you measure your business performance and identify opportunities for growth.

Why Benchmarking Matters

  • Identify Strengths and Weaknesses: See where you lead or lag.
  • Set Realistic Goals: Align your margin improvement targets with industry realities.
  • Attract Investors: Demonstrating strong margins compared to your sector boosts credibility.

2025 Gross Margin Benchmarks by Industry

Here’s a snapshot of projected gross margin averages for 2025:

Industry Average Gross Margin (%)
Software / SaaS 75% - 90%
Retail (Non-food) 35% - 55%
Retail (Food) 20% - 35%
Manufacturing (General) 25% - 40%
Professional Services (Consulting, Legal, etc.) 50% - 70%
Construction 15% - 30%
Hospitality (Hotels, Restaurants) 15% - 25%
Healthcare Services 30% - 50%
E-commerce 30% - 50%
Logistics and Transportation 10% - 25%

Source: Aggregated industry reports, analyst forecasts, and financial studies as of late 2024.

How to Use This Information

  • If you're below your industry average: Time to review pricing, reduce costs, or shift product/service mix.
  • If you're above your industry average: You're in a strong position — focus on maintaining operational efficiency and pricing power.
  • If you're near average: Small margin improvements could make a major impact on profit.

Tip: Small increases in gross margin (even 1–2%) can significantly boost net profits over time.

Key Trends Shaping Gross Margins in 2025

  • Automation: Companies automating production, customer service, or logistics see better margins.
  • Supply Chain Resilience: Businesses diversifying suppliers or sourcing locally are better protected from COGS volatility.
  • Value-Added Pricing: Firms focusing on premium offerings enjoy stronger margins than those competing solely on price.
  • Sustainability Costs: Environmentally responsible practices can raise COGS short-term but offer pricing power and customer loyalty long-term.

Benchmarking Checklist

Use this quick checklist when assessing your margins:

  • ✅ Compare your gross margin to your industry average.
  • ✅ Segment margins by product or service line.
  • ✅ Review supplier contracts annually.
  • ✅ Update your pricing model at least once a year.
  • ✅ Invest in operational efficiencies wherever possible.

Final Thoughts

Knowing your gross margin is important.
Knowing how it compares to your competitors? That’s strategic power.

By benchmarking, adjusting, and optimising your gross margin regularly, you can:

  • Strengthen profitability
  • Weather economic challenges
  • Position your business for sustainable, long-term growth

Stay tuned: Next, we'll dive into specific tactics to improve your gross margin in 2025 and beyond.

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Take your gross margin strategy even further with these essential guides:

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