This research focuses on the profitability of Finnish construction companies. Companies are compared industry wide. Companies are classified and grouped based on the revenue group, location and industry classification. These groups are compared based on their differences to profitability.

The theory part contains comparison of different strategy schools. The difficulty of measuring the strategy has been analyzed separately. The theory of this research has been built on the market-based view, and it has been complemented by the relational view. The research is quantitative.

The dada is financial statement data from the database. In the analysis has been used three years means from 2016-2018. Variables are revenue, employment costs and material and service costs from the revenue. These variables are used together with location and industry classification groups as independent variables and these are compared to the dependent variable which is a profit margin. Analysis has been performed by ANOVA analysis and hierarchical linear regression analysis.

The research points out, that the competition is different between regions. Location matters and it can be measured. Industry classification affects to the profit margin, specialization increases the profitability. Specialized companies have a higher profit margin than companies which does general construction. When company grows, profit margin drops, but largest companies which contains only one per cent of total number of companies makes more than 40% of net income of the whole industry.