Residential Roofing Contractors – Financial Performance Standards
The national average sales for the upper 20% of residential roofing contractors are slightly greater than $3 Million per year. A typical small roofing contractor will have a couple of crews working various projects and frequently sub out jobs. In addition, the owner acts as a project manager and there are one to two estimators depending on the volume of work.
For readers, their primary concern is the profitability of residential roofing contractors. A simple answer is 14%. But it is never that simple. Each contractor is different in how they exist as a legal entity; how much is paid to the owner as compensation; and how is the company organized or structured? All of these questions greatly impact the ability of a residential roofing contractor to generate a net profit of more than 14% annually. For those readers that are homeowners and wondering how much your local roofer is earning off your roof, you may believe that 14% is excessive. The simple truth is that it is NOT. Earning 14% versus the risk the contractor assumes for call backs, leak damage and injuries on the job site is acceptable. Given the nature of what is involved and the risks, 14% is actually low.
Take a look at a simple profit and loss statement for a residential roofing contractor:
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