Starting and managing a roofing company
How to start a residential roofing business
Step 1: Determine your product offering
Broadly speaking, there are two types of roofing jobs: retail and insurance restoration. While some roofing companies engage in both kinds of work, most focus on one or the other. Before you build out your business plan, you’ll need to decide whether your roofing business wants to focus on retail or insurance restoration work. Each type of work has its own advantages and disadvantages to consider.
Retail roofing
Retail roofing contractors perform regular roof repairs and replacements that are initiated by homeowners. These repairs could be due to an active issue, such as a leak or crack, a roof reaching the end of its lifespan, or a decision to change roofing materials or install a specialty roof.
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Insurance restoration roofing
When a roof is damaged by a storm or other weather event, insurance restoration roofing companies are called in to perform repairs. These repairs are typically covered by the homeowner’s insurance policy.
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Step 2: Identify your target market
To identify your target market, you’ll need to determine the services your roofing business will offer, as well as the needs of your local area. Some contractors will target certain geographic regions, while others may target the installation of specific types of roofs such as metal, tile, or asphalt shingles. Or, you may want to focus on specialized roofing, like flat roofs for multi-unit residences.
Researching local demographics, such as the average age of homeowners, the cost of homes in the past few years, and the types of homes that were recently sold, will help you learn more about your potential customers. It can also be helpful to research what other roofing companies are doing so you can find your niche and avoid oversaturated areas of the market.
Step 3: Determine costs and pricing
The average cost of starting a roofing company is between $6.5k and $13k. This includes equipment, licenses, advertising, and more. If you need capital to cover the costs associated with starting your roofing company, there are a number of sources you can explore.
Small business loans
Most banks and credit unions offer small business loans that can be used to cover startup costs. The U.S. Small Business Administration also offers loans designed to assist businesses that are unable to get startup funding from banks.
Personal loans
Financing your roofing business using a personal loan from a bank or credit union is also an option. For business owners with good credit, a personal loan may be easier and faster to obtain than a small business loan.
Local investors
There may be individuals or organizations in your area that are looking to invest in local businesses. Connecting with other entrepreneurs or contacting your local chamber of commerce can help you find these potential investors.
Equipment financing
Banks, credit unions, and online alternative lenders can help you finance your roofing equipment rather than buying it outright. Some equipment suppliers will connect you directly with financing options.
As you get a better idea of what start-up costs look like, you’ll also want to start thinking about how much you will charge for your roofing jobs. Considerations to support your pricing model include:
- How other roofing companies in your area price jobs
- Cost of materials, labor and other expenses
- Your revenue and profit goals
Some contractors try to offer the lowest price possible, whereas price their services based on quality and service. There are many paths to success as long as you determine your goals and build your pricing strategy accordingly.
How much can a roofing business owner expect to make?
The average profit margin for roofing companies is between 20%–40%, and the average revenue can range between $1 million and $20 million, depending on the size of the job, the location, the type of materials involved, and more. While every roofing company is different, these numbers will help you set realistic goals.
Step 4: Find resources to help you get started
Starting a successful roofing company doesn’t happen in a vacuum. Take advantage of the many resources available to you in order to get off to a strong start.
Federal, state and local governments all have resources available to help small businesses like yours get started. These include networking opportunities, business mentoring, and financial resources. While these resources will vary by location, checking out the U.S. Small Business Administration, locating your nearest Small Business Development Center, and contacting your local Chamber of Commerce are great places to start.
Learning from experts in the roofing industry will make you a better roofer and a more savvy business owner. One way to do this is to become a member of an industry organization like the National Roofing Contractors Association or National Women in Roofing. You can learn a lot by attending industry trade shows like the International Roofing Expo. There is also a wealth of online resources and publications that can help you stay up to date on industry trends, such as RoofersCoffeeShop or Roofing Contractor magazine.
While other roofers may seem like “the competition”, they can also be a valuable source of information and support as you start your roofing business. Consider joining a Facebook group for roofing contractors where you can ask questions and receive advice.
Roofing software companies like AccuLynx provide blogs, ebooks, webinars, and other resources where you can learn about best practices, find solutions for common problems, and hear from other successful roofing businesses.
Understanding the terminology
Roofing terminology can be confusing to those who are new to the industry. If you’re not sure of the difference between a rake and a ridge, or what it means that a roofing job is measured in squares, AccuLynx’s residential roofing glossary can help you navigate unfamiliar language. Check out our guide to common roofing industry terms.
Step 5: Make sure your roofing company can legally operate
You’ll need to fulfill all the legal requirements for operating a roofing business in your area before you can start any roofing work.
Register your business
While most roofing businesses don’t need to register with the federal government, you will likely need to register with the state government in order to conduct business activities. The type of registration you need to file will depend on your business structure (e.g. LLC, partnership, or corporation), as well as the laws of the state. Contacting your local chamber of commerce or learning from the Small Business Administration can help you figure out how to register your roofing company and what you’ll need in order to do so.
Obtain permits and licenses
Permitting and licensing requirements can vary between states, counties, and even cities or towns. You will need a general contractor’s license in most states, and in some areas, you may also need special licenses for roofing and the other trades or services your business offers. These might include:
- A residential roofing license
- A home improvement license
- Credentialing for specialty roofing material installation
Your local chamber of commerce or small business association can help you identify the permits and licenses you need to start a roofing business.
Understand OSHA requirements
You will need to adhere to OSHA roofing standards to implement safety measures and provide proper training for you and your employees. Doing so will help reduce the risk of accidents that can happen on a job.
Step 6: Get your roofing tools and equipment
Be ready to start your first job right away by collecting the right tools and equipment for your roofing business.
Office space
While some roofing businesses may be tempted to cut costs by working without an office space, having a dedicated place of business allows you to bring your teams together in one location, creating a more cohesive and friendly work environment. In your office space, you can take care of administrative tasks, hold sales meetings, develop your business strategy, and more.
An office space is also an advertisement for your business. You can set up a Google Business Profile with the location of your office space and hang a sign outside to attract attention. Having a dedicated business address (as opposed to a home address) will reassure customers that you are a professional, reliable business.
Equipment
Here are a few of the most essential tools your roofing business will need:
- A truck or van
- Technology like a business laptop and work phone
- Roof installation tools such as nail guns, saws, and drills
- Measurement tools like a measuring tape, reel, and chalk
- Safety equipment such as hard hats and safety harnesses
For a more comprehensive list of tools and equipment your new roofing business should invest in, IKO compiled essential tools for shingle roofing.
Step 7: Insure your roofing business
Starting a new roofing company is a significant investment of time and money. Some states require specific insurance types, which you can verify with a local business association. Insurance for your roofing company protects your business investment, preparing you for the unexpected. Check out the different types of insurance your roofing company might need.
This insurance covers property damage, personal injury, and bodily injury that is the fault of your company. If your roofing business damages a homeowner’s property or someone is hurt on your premises, general liability insurance will cover the cost.
Depending on the number of employees at your roofing company, your state may require you to have a workers’ compensation policy. This policy will provide financial assistance to your employees if they are injured on the job.
Having professional liability insurance will protect your roofing business against lawsuits and claims of negligence. Professional liability insurance is especially helpful for roofing businesses who recommend specific products or treatments, as it will protect your business from fallout if these products fail to perform as expected.
If your roofing company plans to own or lease any vehicles, you’ll need this insurance to provide coverage for them and protect against financial burden if your vehicles are involved in an accident.
If you’ve invested in expensive roofing equipment, use this insurance to protect your investment and provide coverage in case of damage or loss. Some general liability insurance plans will allow you to add extra coverage for equipment.
Having a health insurance plan for your employees isn’t a requirement, but it can help them pay for medical bills in the event of an accident or illness and can help keep them healthy and working.
Step 8: Hire the right employees
When it comes to hiring employees, you’ll want to secure a team of people who are committed to the roofing industry, willing to work hard, and aligned with helping you achieve your business goals. Job boards, local associations, and recommendations from friends can help you identify potential candidates. Focus on filling the most essential roles first, and add additional staff as your roofing business grows.
To help your roofing jobs go smoothly, you’ll need a production manager or general manager to oversee the production process. This includes ordering materials, managing team schedules, and staying on top of how jobs are progressing. A detail-oriented, organized production manager will help you save time and money.
Having a dedicated sales team will help you find and verify more qualified leads, turning them into customers more quickly. Look for salespeople that are highly driven, persistent, engaging to interact with, and passionate about roofing.
Administrative staff take care of routine daily tasks like bookkeeping, payroll, answering phones, and maintaining the office, so you and the rest of your teams can focus on roofing. The right administrative staff will help you work more efficiently and avoid costly errors.
To ensure customer satisfaction, you’ll need an efficient, knowledgeable roofing crew, led by a foreman or crew leader with strong communication skills. The AccuLynx blog offers tips on where to find a great roofing crew.
Step 9: Invest in technology
Investing in roofing technology right from the beginning provides a strong foundation for future growth and helps you compete against more established roofing companies. Here are a few ways that roofing software benefits your new business:
Money and time savings
Instead of having to do everything by hand, you can take advantage of pre-built systems and tools in a business management software that allow you to get more done in less time. Relying on roofing technology also reduces the likelihood of human error during measuring, estimating, and ordering so you can keep costs low and increase profits.
Improved communication
Technology like roofing apps helps team members stay connected whether they’re in the field or at the office, and consolidates job information in a single location so everyone is on the same page.
Better customer service
With the right roofing technology, you can offer your customers the services they’ve come to expect, such as online payment options, portals to stay updated on their roofing projects, and appointment reminders via email or text. Roofing technology also helps you stay on top of your projects so they can be completed in a timely manner, increasing customer satisfaction.
There are many different types of technology that help roofing contractors do their job. The following technology has become especially popular among roofing contractors in recent years:
- Aerial measurement services
- Online material ordering
- Photo management tools
- Email and text automation
- Roofing proposal/estimate generators
- Digital payment processing
With so many options, it can be hard to know what type of technology to start with. Choosing a single software application that has everything you need to power your work allows you to save on subscription costs. Roofing business management software like AccuLynx brings all of the above-mentioned technology—and more—together into a single system. AccuLynx offers a robust set of features that help roofing companies grow.
A Customer Relationship Management (CRM) system helps centralize all your job information, making it easy to track and manage your projects. With a roofing-specific CRM, you can automatically upload leads, learn which leads are most likely to convert with AI-based lead rankings, and maintain a full record of your interactions with homeowners. This ensures that your team has the information they need at their fingertips to build stronger customer relationships and close more deals.
Create professional-looking estimates and present those roofing quotes to homeowners in minutes with digital templates that automatically pull in customer information stored in the system.
Use integrations to place orders directly with your preferred material supplier directly from your job file in the software system.
Manage team schedules from a single shared calendar, see what’s happening at a glance with a live activity feed, and instantly notify crews of schedule changes.
Automate recurring messages, send emails and texts directly from the job file, and share access to a customer portal where homeowners can receive real-time project updates.
Stay connected to your projects from anywhere with mobile apps that bring the full power of your roofing software right to your pocket. Whether you’re in the field or on the go, you can access essential tools and up-to-date job information at your fingertips, ensuring you’re always in control of your business.
Offer customers financing and online payment options right from your software, easily track job revenue and expenditures, and build invoices with just a few clicks.
Stay on top of KPIs with pre-built reports and customizable dashboards.
Sync data from lead generation sources, weather mapping, aerial roofing measurement providers, accounting software, photo management apps, and more so you can manage all your business activities in one place.
Step 10: Start getting the word out
Start connecting with homeowners in your target market and build your customer base as soon as your new roofing company is ready to start work. Here are a few proven roofing marketing tactics to help your company get started:
Company website
Most homeowners do their research online, and a strong website will give them a positive impression of your roofing company. On your website, make sure your contact information is easy to find, describe what sets your roofing company apart, and prominently display any special offers.
Social media
Creating a social media account for your roofing company, such as a Facebook page, helps you showcase your work and connect with potential customers on a platform they frequent. You can also purchase ads on social media to reach a local audience.
Online listings
Setting up online profiles will help you get found when homeowners search for roofing companies in their area. An online profile on review sites such as Yelp and Angi will give future customers an opportunity to leave feedback and share positive experiences with other homeowners.
Managing a roofing company
Once your roofing company is up and running, your focus shifts to planning for the future. Here are a few strategies that can help you ensure your business is productive and profitable over the long haul.
Standardize internal processes
Having standardized processes for every step of a roofing job will help you work more efficiently and reduce job delays. It will also simplify the onboarding process as you grow your team. Roofing software like AccuLynx makes it easier to standardize your processes with tools like a custom workflow manager, templates for your job documents, and checklists for your crews. By using a single roofing software system to manage every aspect of your business, you’ll be able to easily look back on past jobs, find the information you need for every step of the roofing process, and streamline the way you work.
Introduce automation
Automating routine tasks and communications can save you significant time and ensure you never miss a chance to connect with customers. For example, using the Automation Manager in AccuLynx, you can set up an appointment reminder text message that is automatically sent to a homeowner once their appointment is scheduled. Or after a job is marked as completed, you can send an automated email with a link to leave a review or provide a referral. You can also create automated tasks to help team members stay on top of their work, such as a reminder to schedule a crew for a job once an order is filled.
Use data to identify areas of opportunity
The most successful roofing businesses stay up to date on key performance indicators (KPIs) and are always on the lookout for areas of potential growth. Using the reporting features in AccuLynx, you’ll be able to see pre-built dashboards with data on sales, production, marketing, accounting, and more. You can customize these dashboards and drill down into specific reports to help you better understand your roofing business performance, look for trends, and make informed decisions about how to drive greater growth in the future.
The right software to help your new roofing business grow
AccuLynx is an all-in-one business management software created specifically for roofing contractors. As a leader in the roofing industry, thousands of new roofing companies have used AccuLynx to get off the ground, grow profits, and scale their businesses.
By bringing together every aspect of your business in a single cloud-based system, AccuLynx helps you stay organized, work more efficiently, and reduce repetitive tasks. In fact, AccuLynx customers save 468 hours per user annually and new users see a 32% increase in job profits after one year. Learn more about how AccuLynx, the #1 roofing software, can help set your roofing business up for success.