The Economics of Running a 3-Van Refurbishment Crew in London

Scaling a refurbishment business from a single owner-operator setup to a three-van operation is the point where many London builders hit their first real ceiling. This transition shifts your role from lead tradesperson to a full-time operations manager, where the profitability of the business relies more on logistical efficiency than your own ability to fit a kitchen. In this breakdown, we examine the hard numbers behind running a three-crew fit-out company in 2026, focusing on the margins required to stay afloat in the capital.

The Realities of London Overheads

Operating in London carries a premium that goes far beyond higher fuel costs. For a three-van operation, your fixed monthly overheads are significantly higher than those of a solo trader. You are no longer just paying for tools; you are paying for the infrastructure required to keep six to nine people productive every day. In the current market, a typical 3-van firm specializing in mid-to-high-end bathroom and kitchen refits faces a monthly burn rate that can easily exceed £12,000 before a single bag of plaster is purchased.

Your primary fixed costs generally break down as follows:

1. Lease and Insurance: Expect to pay approximately £650–£850 per month per van for mid-sized electric or Euro 6 compliant vehicles, including comprehensive commercial insurance and ULEZ compliance fees.
2. Storage and Yard Space: A secure unit in Zones 3 or 4 for storing materials and waste bins will cost between £1,800 and £2,500 per month.
3. Back-office Software: CRM tools, accounting software (like Xero or Sage), and project management platforms for three crews typically cost around £300 per month.
4. Public and Employer's Liability: With three crews, your insurance premiums will reflect the increased risk, often costing £4,000–£6,000 annually.

Labour Costs and the Skills Gap

Labour is your largest variable expense and the one most likely to erode your margins. In London, a lead multi-trade operative now expects a day rate between £220 and £280, while a skilled labourer or apprentice costs between £120 and £150. If each van consists of a two-person team, your daily labour spend is roughly £1,200. Over a standard 21-day working month, that is a £25,200 wage bill.

To maintain a healthy 20-25% net profit margin, each van needs to be generating at least £850 in value per day. This requires meticulous scheduling to ensure that teams aren't sitting idle waiting for deliveries or Gas Safe sign-offs. Many firms are now moving toward a 'Lead plus Two' model per van to increase throughput, though this increases the management burden on the owner to ensure quality control remains high enough to satisfy TrustMark or FMB standards.

The Revenue Target for a 3-Van Operation

To justify the headache of managing three crews, the business needs to be turning over significant volume. If we assume each crew handles one medium-sized kitchen or bathroom refit every two weeks, the business is completing six projects per month. With an average contract value of £15,000 (inclusive of VAT), the gross monthly revenue target is £90,000.

• Gross Revenue: £90,000
• Materials (approx. 35%): £31,500
• Labour (3 crews): £25,200
• Disposal/Skips: £3,000
• Overheads: £12,000
• Gross Profit: £18,300 (approx. 20%)

This £18,300 monthly profit must then cover your own salary, corporation tax, and a reserve fund for tool replacements or vehicle maintenance. The danger zone for a 3-van firm is when one van falls behind schedule; a one-week delay on a single project can wipe out the entire month's profit for that specific crew due to the fixed nature of labour and overhead costs.