Roofing Business Economics : How much to charge per square? School for Roofers

Lesson from roofing-school.com.
Roofing Economics: Why Roofers Sell Millions but go Bankrupt? Roofing School
Comment below your formula how much to charge and if you know your break even point!
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From Insights:
00:00 Intro
00:56 Factors that build your price
01:19 Cost of labor
02:00 Cost of materials
02:24 Desirable profit margin
03:31 Overhead
03:45 Closing rate
04:55 Break-even point
06:45 5 things that affect break-even point...
06:49 Overhead
07:29 Closing rate
07:42 Your price
07:54 Demand
08:56 Average ticket
09:15 Different business models you can employ while accounting for these factors
09:23 High price/low volume
11:23 Mid price/ mid volume
13:05 Low price/ high volume
14:37 Head-to-head comparison between 3 models
18:25 Check out the Roofing Business School!
Read more about Roofing Economics: roofinginsights.com/roofing-b...
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[@readyroof]

I'm in Long Island, New York. First year in business I've got a 41% closing rate charging about $400-425/square with very little overhead. Learned the hard way that advertising in December and January the same way I did in spring/summer DOES NOT pay. The biggest companies in my area are charging about $650/square. I will probably have to raise my price for 2022 as the supply houses continue to warn of material increases. Thanks Dmitry, I consider your content the gospel!

[@vimalcurio]

May I know how much your overhead was?

[@randyuriarte787]

23 year old here starting my roofing business. Been in the Insurance Storm Inspection industry for about 2 years, so I'm ready to be my own boss. Oregon has plenty of work to be done and I'm looking forward to it. The knowledge/presentation of this video is better than any college course if ever taken. Sincerely, Thank you, Dmitry. I send you kind regards to you and your family.

[@alexiscool562]

Here in California, we have priced some roofs at $700/ sq! I’m talking a shingle roof too.

[@MYRONone.]

where exactly north or south cali?

[@garenarmstrong2058]

I always watch Roofing Insights just to stay on top of my game. Thank you Dimitri!

[@brandonbolsius3254]

I’m a 26 year old buisness owner in roofing in Texas. I got a lot of questions, but your content helps a lot, one day I hope to chat with you.

[@roberth7255]

You forgot some key factors. By increasing work you are also increasing your payroll, insurance from doing more work, liability… etc

[@Jake-Truth-Snake]

Dimitry, you left out an important factor: *A good salesman can close deals that are higher price per square, with a high close rate* even if the company is a small, newer company. A good salesman can build trust and confidence with a customer, which will justify in the customer's mind that you get what you pay for, which is true. I close deals where I'm definitely not the cheapest, very frequently. A good salesman is priceless. Company owners: if you screw your salesman out of money he earned, good salesman will leave, you will get a bad reputation, and you will have to work harder, spend more money, and deal with more headaches, instead of just paying people what you agreed on. Scum bag people attract scum bag people.

[@RoofingInsights3.0]

Agree on your point in general. My answer though: you cannot outsell yourself out of trouble. Even if you have good sales people and you are not meeting your breaking points you will be out of business soon.

[@Jake-Truth-Snake]

@@RoofingInsights3.0 I agree that if your overhead is too high, and/or a business owner blows all the money on his lifestyle, then you won't be able to save yourself. But *the quality of salesmen are the defining factor of a business.* Installing a roof, and doing the paperwork is pretty straightforward.

[@andersonroofing660]

Always enjoy listening to your content.

[@benbell7275]

Great video. . Thank you for kicking out so much content for us !

[@RoofingInsights3.0]

You bet! Glad people finding it helpful. Not many are willing to learn!

[@orlandogarcia5398]

Man you have some great content! I learn something new every time. I thank you

[@marccote7257]

Love your video! I want to start roofing business in Florida. Thank you for your advices. I think I will need to speak with you.

[@victorhuipio3894]

Wow! This speaks to me. I've been re-evaluating my business model for the past few months, looking for the master metric. It's become clear the break even point is the master metric.

[@RoofingInsights3.0]

You got this! Let me know if I can help. Roofing Business is tough

[@ringosroofing4131]

Thank you so much for the video that help me a lot You’re talking really good Clear good teacher Thank you

[@RoofingInsights3.0]

Thank you for feedback! Where you from?

[@ProTrendsroofs]

hey brother been following you for few months now. just wana say how thankful we are to have enlightening us noobes. I been working in production for few months. I'm trying to get on my own and I could really use someone like you to guide me with the start up. so far it's just me working for someone alse. hehe thanks again Dimitri keep up the awsome work.

[@RoofingInsights3.0]

Glad to help, thanks for taking time to share feedback!

[@greggmireau9279]

Excellent video with great content. You really break it all down, so it is easy to understand. By knowing your numbers, you always know where you stand. A must view video clip.

[@RoofingInsights3.0]

Thanks Gregg. Numbers don’t lie. If you don’t know your numbers you don’t know your business.

[@codyrhea4368]

Great content. Thanks for this. Extremely helpful

[@RoofingInsights3.0]

Glad it was helpful!

[@RoofingInsights3.0]

From Insights: 00:56 Factors that build your price 01:19 Cost of labor 02:00 Cost of materials 02:24 Desirable profit margin 03:31 Overhead 03:45 Closing rate 04:55 Break-even point 06:45 5 things that affect break-even point... 06:49 Overhead 07:29 Closing rate 07:42 Your price 07:54 Demand 08:56 Average ticket 09:15 Different business models you can employ while accounting for these factors 09:23 High price/low volume 11:23 Mid price/ mid volume 13:05 Low price/ high volume 14:37 Head-to-head comparison between 3 models 18:25 Check out the Roofing Business School!

[@santiagoaltamiranda5758]

Demitry your info Help a lot to me !! Great info !! 👍🤙🤟

[@pauldebeer7279]

Great video. Really good information. Thanks

[@RoofingInsights3.0]

Thanks Paul, always good to see you around.

[@shaneMcguire1981]

Thanks! Great models!

[@RoofingInsights3.0]

Glad you like them! Do you know your break even point?

[@robertstellan6017]

This is GOLD

[@RoofingInsights3.0]

Thank you so much for generous comment!

[@thelokoshon2721]

You are the best tank you!!

[@JoseMorales-su8ol]

Liked commented and subscribed!

[@josepowerconstruction78]

Very good information. Can you help me to analyze my roofing business please

[@alexschwartz1483]

Always bringing the value! Question: What's the most efficient way you keep track of your numbers? We use jobnimbus and try to plug data in there but it's currently not too user friendly. When you're looking at those numbers, does that include supplement increases?

[@RoofingInsights3.0]

Quick books all the way!!! Quick books quick books quick books!!! March is quick books month in roofing-school.com

[@ivtec845]

Here in NY I do 350sq for friends and family 400 for everyone else that doesn't include a dumpster and more than one layer is extra and plywood is extra

[@RoofingInsights3.0]

The real question is not what you charge per square but whats your business profit margin at the end of the year AFTER you paid yourself.

[@ivtec845]

@@RoofingInsights3.0 enough that I can live a comfortable life 🤣 but yes that is almost the only real number that matters

[@james4878]

If you charge $400 per square, how does that break down? Generally speaking how much per square for materials and how much per square for labor?

[@manuelloja913]

Great ideas!! I’m from state of Massachusetts. I’m starting roofing and siding business. How can I contact with you to for more classes?

[@cristinoestrada9865]

You're the best

[@Stuglamp2009]

I own a small roofing company in Alberta, Canada and these prices are absolutely insane! We almost never use the "square" measurement, we always use the "bundle" measurement. (1 bundle is 1/3 of a square). 4/12 re-roof, easy as it gets - highest prices around here maybe $120/bundle ($360/sq)... even $500/sq is absolutely ridiculous. I'm also talking CAD!! So it's even more ridiculous lol.

[@bilobath6093]

Agree with your statement

[@draketv_]

I was thinking same

[@PhillipeDantas]

anybody from minnesota ? 650 too high here ? 38% of closing rate

[@TheRealJakeRyanMusic]

I wish i had a big enough business to factor all of this stuff 😂 I am a subcontractor and install for 70 a sq. Very low overhead. Its just me and a buddy. I pay him 20 a sq. I just got asked for a bid on a 28 sq 1 layer tear off install. Materials were about 3400 so what i had been taught was to multiply that by 2 ($6800) to get a final price. I've made money using this simple formula but I feel I may be lowballing myself.

[@RoofingInsights3.0]

I would do $9800 for that job

[@TheRealJakeRyanMusic]

I havent yet submitted the bid to the homeowner, I'm still trying to get a final price together. Im pretty sure most roofers in boise charge about 350 a sq but am not positive

[@TheRealJakeRyanMusic]

Thank you man, I appreciate that. I get plenty of jobs and always feel like I sell myself short. I'll let ya know how it works out

[@jaga72]

Yes, little fish in the sea will just double it. Thats cuz there really ain't much overhead. Sharks on the other hand, 3-6 time more cuz they have salesman, office people, profit and so on. So a big company owner will make the same as you in the end after paying everyone else. So being small ain't bad, you just dont pay so much in other things

[@joeldelamirande5792]

Very interesting

[@joeldelamirande5792]

I would take help to analyze numbers how to do better like you explained dimitry

[@RoofingInsights3.0]

You will! It takes time!

[@gabi4593]

Is being paid $20CAD/hr fair when doing full jobs alone? Or should that person be paid more?

[@joseaparicio7029]

Dimitri I have some questions I'm ready for start roofing business how can I talk o chat with you or someone helping

[@RoofingInsights3.0]

Join roofing-school.com, we schedule weekly calls with students

[@ToddBizCoach]

Isn t overhead the only variable in determining your break even point? You mentioned labor cost being at a minimum $60/ sq in Minneapolis. Were you referring to the reroof labor or reroof with tear off labor?

[@RoofingInsights3.0]

Reroof with tear off labor. More like $80 now. Overhead is not the only number, your profit margin also plays big part of it but you are correct: overhead is the main driver here. Many struggle to figure it out.

[@5thsealministries685]

DOWN N LOUISIANA WE PAY SUBS WITH INSURANCE $80 SQ I GET $100 SQ FOR ME OR I WALK AWAY

[@ToddBizCoach]

@@RoofingInsights3.0 I was referring to cost being paid to subcontractors.

[@ToddBizCoach]

@@5thsealministries685 do you pay for a project manager on site, or do you leave quality control up to the subcontractor?

[@RoofingIntelligence]

This is a very compelling presentation and a well-done video. However, I think your logic is flawed as there is no way a business with 40 jobs a month is going to have the same overhead as a business doing 100 jobs a month. That's an extra 720 jobs per year and there's no way those 2 types of businesses are comparable on their overhead costs. Michaels Stone explains every well in his books how overhead increases with sales growth. I do think your point at the end about having high closing rates and high prices is a more realistic scenario.

[@RoofingInsights3.0]

Good feedback. But I disagree: company who does 100 jobs one month can drop to 80 jobs following month, and if the don’t know their break even point they will b rrein red or be in red and don’t even know it. But they might think they are profitable while loosing money

[@mannygigi7486]

Hi how are you This is Manny I would like to talk to you please how can I contact with you ?

[@tinamcwilliams7029]

I've done all the big wings at my work

[@jjsroofing860]

In Alberta even the bigger and more expensive companies are only charging 270.00 to 330.00 a square. The labour is 75.00 to 90.00 per square.

[@RoofingInsights3.0]

Not sure if it’s accurate statement. Working with few companies there, not what we see.

[@james4878]

With a price of $330 per square with $90 of that being for labor, how does the remaining $240 per square break down? Is that for materials and disposal?

[@jjsroofing860]

It’s more like 140 to 150 with underlayment for labour and material for Duration and underlayments is around 140.

[@james4878]

@@jjsroofing860 So about $140 in labor and also about $140 in materials? Does this include tear off labor and disposal cost?

[@jjsroofing860]

@@james4878 we do our own work . It’s just one crew with employees paid by the hour. We don’t sub out our work. It’s too hard to find good crews in our area. I just know that that’s what the going rates are here. I just made this comment to Roofing insights because there’s no way we get 500 or 600 a square out here. If I could get 600 a square I would have the best 20 crews around and pay top dollar lol.

[@tinamcwilliams7029]

Truth is I'm a great roofer but need buissness experience

[@tinamcwilliams7029]

I'm just ai little buissness that the consumer brought me Into .I do a great job and have the jobs coming in .I want my buissness to be successful

[@THERAWONE1]

Awesome!! I'm enrolled in the school . How can I schedule a call id love to pick your brain

[@RoofingInsights3.0]

Reach out amber. Number is on all our sites.

[@THERAWONE1]

@@RoofingInsights3.0 thanks !

[@tinamcwilliams7029]

Big bosses roofs

[@capecodroofer4176]

$65/sq strip&installation?? Is it real price in 2021??

[@RoofingInsights3.0]

In some markets yes, mainly south.

[@james4878]

What would be a common strip and installation price where you're at Cape Cod Roofer?

[@capecodroofer4176]

@@james4878 lucky if you can find subs for 120-130 (1 story walkable ranch). This year - could be 250-300

[@james4878]

@@capecodroofer4176 Is that labor only price? Or labor + all materials price?

[@capecodroofer4176]

@@james4878 labor only

[@AnthonyGarcia-rb3ph]

What is the name of your roofing company ?

[@RoofingInsights3.0]

I have sold it after 7 years in business: Storm Group Roofing, Minneapolis

[@tinamcwilliams7029]

I have the work

[@robertmertz4831]

Do you inlcude your own salary in your break even number?

[@vimalcurio]

Did you find the answer?

[@timothylow8121]

Really? In us the shingle roofing price can between .$500 to $600 usd per square, here where I’m Toronto just $200 to$300 per square

[@RoofingInsights3.0]

I know few companies in Canada who start at $450.

[@james4878]

@@RoofingInsights3.0 If your price per square is $450 for example, how much of that might be for labor?

[@tinamcwilliams7029]

I work out of my home

[@tinamcwilliams7029]

600 so much money

[@tinamcwilliams7029]

400 not a bad price

[@crunch9876]

Why does he assume your not roofing in house?

[@tinamcwilliams7029]

In making money but the blood sweet and tears are there. I'm teaching a person to be lead

[@zekeisme1]

you not paying anyone $90 a square for labor

[@RoofingInsights3.0]

How much?

[@spzzxy-1015]

I’m 2024 I know a group that would take 65 for just metal install

[@yungdcwa81]

i will sell you my system to save money by not signing up for stupid stuff