Do you want to start a roofing business and you want to know the cost? If YES, here is an estimated cost breakdown for opening a roofing company.
Almost every structure needs a roof, be it a house, business, school, or government building. Roofing companies always have a consistent flow of work as roofs do not last forever and they also require periodic inspections, maintenance and repairs after installation.
If you want to start a roofing business, you must realize that running a profitable roofing company is a lot more than knowing how to find a leak or replace a roof tile.
Building a successful roofing company requires good organization, knowledge, patience, perseverance, people – skills, and a number of other traits. Many business owners fail, not because they weren’t skilled in their craft, but because they were not skilled in running a business.
Estimated Cost Breakdown to Start a Roofing Company
Note that the amount of capital you need to start a roofing company will depend on the Business model – whether you are using subcontractors or employees. However, it is completely possible to start with a very low overheard. As a matter of fact, many roofing business owners suggest slow initial growth.
Allow your equipment to pay for itself before going off to buy more. Same goes with hiring processes. Hire slowly and fire quickly. Don’t just try to fill seats. Ensure that each of your new hires is trained properly. One common mistake new company owners make is to splurge on marketing and advertising your business.
Advertising is going to be one of the most expensive expenditure in your business until you begin to get more referrals. Experts suggest starting small and local. Do your research, and test out the water before you immerse yourself in it. Below are the expected costs of starting a roofing company.
-
Leasing of Business Space
Indeed, a roofing business can be launched from your home; additional space will only be required as the business grows. Storage space must be available to house roofing materials. Expect the price for leasing an administrative office to be upward $1000 per month.
-
Basic Equipment
In this business, you will also need trucks for the transportation of materials. You will also have to pay for high – speed Internet and utilities. A new truck will likely cost $20,000 or more. A dumpster rental costs about $350. Alternatively, you can purchase a dumpster for around $3,000.
You will also need ladders, safety belt & suits, nail gun/handheld tools, business cards and website. Consider budgeting $200 for monthly utilities, $1,000 for office supplies, and a couple hundred dollars per month for advertising. Expect all these to cost at least $50,000, including the truck.
-
Workforce or Labour
When it comes to labour, installers usually receive $15 per hour. Foremen receive around $20 per hour. Labourers typically make between $10 and $12 per hour. If you hire an office manager, he will likely make $15 – $20 an hour.
-
Insurance
Liability will always remain a big issue for construction businesses. Additionally, each state has varying insurance requirements for roofing companies. However, you will surely need General Liability Insurance that covers damage and injury to third parties who are not your employees.
You will also need Workers Compensation Insurance that covers work related injuries to your employees. You should consider professional liability insurance to protect your business from legal claims from customers. You should also seek insurance to protect your vehicle and other business equipment. Budget $10,000 for insurance.
-
Licenses and Permits
Like insurance, permits and licenses requirements depend on the city and state. The purpose of these licenses and permits is to allow you to run and operate a legal business. Acquire local business permits from your town or city hall.
You may find that you might also need zoning, planning, and safety inspection approvals in certain areas. Meanwhile, for State Contracting License, you may need to apply for more than one depending on the type of work. Requirements and regulations vary regionally.
For certain states, your business may or may not need a license depending on the costs of the job. Getting a license also may mean that you need specialized training, certificate, or proof of knowledge. Check with your state for more information and license fees.
Factors Affecting the Cost of Starting a Roofing Company
-
The types of roofing services provided
The cost of opening a roofing enterprise is heavily influenced by the sort of roofing services provided. For example, if the company focuses on simple maintenance and repair work, the expenses are going to be lower than if the company concentrates on sophisticated setups or big corporate projects. Special tools and instruction will be much more expensive for enterprises that focus on sophisticated roof installation.
-
The location of the company
Another essential element determining the capital needed to start a roofing company is the location. The living expenses, taxation, as well as licensing fees largely depend on the location in which the company is situated. Starting a roofing firm in New York City, for instance, will be more exorbitant than opening it in a small Midwestern town.
-
The company’s size
The cost of opening a roofing enterprise is also affected by the business’s size. A bigger business will necessitate more funding to support staffing costs, general liability, as well as equipment and supplies. Furthermore, bigger businesses may have to invest in more advertising and marketing to develop their brand awareness and attract clients.
-
Equipment needed
Roofing necessitates the use of special tools, which may prove costly. The equipment cost will differ according to the nature of the roofing services provided.
A company specializing in flat roof installation, for example, will demand more specific tools than a company specializing in shingle roof installation. Furthermore, the equipment cost will vary based on whether the company decides to lease or purchase the hardware.
-
Insurance and licensing
Insurance and licensing are always required when setting up a roofing company. Insurance and licensing fees would further differ based on the state and city in which the company operates. Certain states, for instance, necessitate roofing companies to take up particular kinds of insurance, including liability or workers’ compensation.
-
Advertising and marketing
Advertising and promotional efforts are critical components of the growth of any company, which includes the roofing industry.
The cost of advertising and promotional activities will be determined by the scope of the company as well as its location. To build their identity and draw in clients, bigger businesses put money more into advertising and promotional activities.
-
Staffing
The next significant factor affecting the cost of opening a roofing enterprise is staffing. The cost of payroll, perks, as well as preparation will vary according to the size of the company as well as its location. Furthermore, if the company provides special-purpose roofing services that necessitate supplemental qualifications and knowledge, the cost of staffing might well be higher.
Conclusion
There are a lot of factors to consider before starting a roofing company. Talented roofers also make the mistake of starting a roofing business with a great understanding of the mechanics but little knowledge about actually starting a business.
Nonetheless, the key to maximizing your roofing business’s profitability is to keep material and labour costs down while securing a steady stream of new clients.
Build a reputation as a high – quality roofer and you will eventually be able to charge more than your competitors as customers will be willing to pay a premium for a roof that stands the test of time. It is also possible to have sideline businesses such as a roofing consulting company. Experienced roofers have an abundance of skills and knowledge that others are willing to pay for.