Machine Shops Revenue Benchmarks
The average machine shops business in the United States generates $3.2M in annual revenue, according to the U.S. Census Bureau Statistics of U.S. Businesses (SUSB 2021). There are 17,275 machine shops businesses in the U.S., employing 209,280 workers with an average profit margin of 10.0%. The average employee in this industry earns $66K per year (Bureau of Labor Statistics QCEW 2023).
What Does a Machine Shops Business Actually Do?
Machine Shops: Businesses that transform raw materials or components into finished products.
Who buys: Wholesalers, retailers, other manufacturers, and government.
Sector-level description — a more specific write-up is available for high-traffic industries.
Average Revenue
$3.2M
per year
Profit Margin
10.0%
industry average
Revenue / Employee
$268K
per year
Total Businesses
17,275
in the US
Est. Owner Income
$324K
small business avg
Labor Cost
22.0%
of revenue
Avg Employee Wage
$66K
per year (BLS)
Market Saturation
5.2
firms per 100K people
How Much Do Machine Shops Charge?
Machine Shops: Manufacturers sell in bulk to wholesalers, distributors, or direct to businesses. Pricing is negotiated by SKU volume. The specifics vary within the machine shops category — the ranges below are typical for the sector.
| Service | Typical range |
|---|---|
Contract manufacturing markup | 15–35% over materials + labor |
Own-brand product margin | 25–60% gross margin |
Custom / low-volume run | 40–150% over direct costs |
Sector-typical ranges — individual services within this industry may fall higher or lower.
Complete machine shops business plan
A 12-section data-backed business plan for a machine shops business — executive summary, market analysis, competitive landscape, revenue model, 3-year financial projections, operations, marketing, staffing, funding request. Pre-populated with real Census, IRS, and BLS data on this industry. Free to view.
Cost Structure — Where Every $100 in Revenue Goes
Approximate P&L breakdown for the machine shops industry. Labor share and net profit are grounded in Census SUSB and IRS SOI data. Other lines are split using sector-typical ratios.
| Category | Per $100 revenue | Per typical business | What's in it |
|---|---|---|---|
Raw materials & components | $48 | $1.5M | Steel, chemicals, electronics, packaging — the physical inputs that become the product. |
Wages & benefits | $22 | $713K | Payroll for all employees at the business (owner comp not included for small owner-operators). |
Rent & facilities | $5 | $176K | Rent or mortgage on business location plus utilities tied to the space. |
Marketing & advertising | $3 | $110K | Google/Meta ads, SEO, print, referral fees, event sponsorships. |
Other operating costs | $12 | $375K | Depreciation on equipment, energy, R&D, quality control, freight. |
Net profit | $10 | $324K | What remains for the owner or shareholders after all business expenses. |
Directionally accurate for a typical business in the industry. Individual businesses vary widely — a franchise may run a very different cost mix from an independent, and older established businesses often have lower labor share than newer ones.
Average Revenue by Business Size
Industry Dynamics (Census BDS 2023)
New Business Rate
4.97%
openings/year
Closure Rate
6.43%
closings/year
Net Job Growth
+0.94%
annual
Businesses Closed
1,157
in 2023
Firm Count Trend
Should You Start a Machine Shops Business?
Startup Cost
$50K – $250K
Break-Even
6 months
5-Year Survival Rate
50.0%
Related Industries
Frequently Asked Questions
- What does a machine shops business do?
- Machine Shops: Businesses that transform raw materials or components into finished products. Wholesalers, retailers, other manufacturers, and government.
- How much do machine shops charge?
- Machine Shops: Manufacturers sell in bulk to wholesalers, distributors, or direct to businesses. Pricing is negotiated by SKU volume. The specifics vary within the machine shops category — the ranges below are typical for the sector. See the pricing table above for typical rates by service type.
- How much does the average machine shops make per year?
- The average machine shops business generates $3.2M in annual revenue, based on U.S. Census Bureau data (SUSB 2021). After expenses, the estimated owner profit is $324K per year at a 10.0% profit margin.
- How many machine shops businesses are there in the US?
- There are 17,275 machine shops businesses operating in the United States, employing a total of 209,280 workers.
- How much does it cost to start a machine shops business?
- Startup costs for a machine shops business typically range from $50K to $250K, with a 5-year survival rate of 50.0%.
- What is the average salary in the machine shops industry?
- The average employee in the machine shops industry earns $66K per year, according to Bureau of Labor Statistics data (QCEW 2023).
Industry Growth & Survival
The machine shops industry is relatively stable — with a net job growth rate of 0.9%. Entry and exit rates are balanced at 5.0% and 6.4% respectively.
Approximately 72% of machine shops businesses survive their first 5 years. This is above the national average (~50%), making it a relatively safe industry to enter. In 2023, 1,157 firms in this industry closed permanently.
Employment & Wages
The average employee in the machine shops industry earns $65,818/year. This is near the national average of ~$65K. With 19,115 establishments employing 263,674 people, the typical business has about 14 employees.
Industry Trend (2000–2023)
The machine shops industry has declined 21% since 2000 (from 25,013 to 19,834 firms).
See full historical statistics →Compare Machine Shops revenue with other industries: