Estimating Strategies for Roofing Contractors

Technology has had a huge impact on roofing sales and communication. But roofing will always be a business of estimating, selling and installing work. And viable estimating strategies remain critically important for all roofing contractors.

So, how do residential and commercial applicators remain profitable and efficient in a technology-driven business climate? By focusing on the tasks that generate profits. For most contractors, that means efficiently procuring and installing jobs.

Estimating Low-Slope Roofing Projects

Traditional commercial estimating strategies require contractors to take details off the existing blueprints or measure the size of the job personally with their own roofing crew.

Now that estimating tools like satellite imaging and 3D modeling exist, roofing contractors must go digital in order to effectively manage the commercial bidding process. If not, they may be unable to keep up with the frequent change orders and additions common to low-slope projects.

But even if roofing contractors use the most efficient estimating technologies available, they must also treat estimating as a profit center, a part of the business that makes a strong contribution to the bottom line. General contractors, developers and building owners will often allow multiple quotes on any given project. And many commercial roofing clients cast broad nets in the hopes of getting the most attractive bids.

All this estimating work costs the roofing contractor time and money. That's why it's critical for contractors to know their cost-per-estimate.

One of the most important estimating strategies is to effectively qualify potential customers before blindly quoting work. It pays to be slower to estimate and quicker to ask questions and connect with customers.

Counting the Costs

Let's suppose a commercial estimator is paid $50K-$60K per year. Add to that payroll taxes and insurance, and you can easily have an annual investment of $75,000 or more.

Next, divide that $75,000 salary by 2,000 hours (40 hours per week, and 50 weeks per year) and you end up with a cost of $37.50 per hour. If it takes eight hours to estimate a job, the final tally is $300.

This may seem like a bargain if you win the bid. But you also need to calculate the ratio of estimates made to projects acquired and continually monitor these numbers.

Estimating in the Residential Market

Residential sales and estimating can also benefit from technology. If you can measure and calculate estimates more efficiently, it leaves more time to speak with customers and handle estimates.

You can estimate less complicated jobs on the spot using a mobile device. However, don't let the efficiency of technology turn you into a drive-by estimator. The residential sales process is about connecting with people, not just producing quotes.

Calculating Your Estimating Efficiency

Let's suppose it takes two hours for each residential estimate, and the average job size is $10,000. If a business averages nine estimates per week and closes three, that contractor spends 18 hours estimating and sells three jobs per week. That equals an impressive $30,000 in sales per week or $1.5 million annually. Of course, few residential contractors can boast of closing three projects every week, week in and week out.

In any case, taking two hours to estimate the job plus one to meet with the customer leaves roughly 27 hours per week of sales time. To make the most of that time, contractors need to estimate most residential jobs on the spot.

Another reason to estimate on the spot is that you may have trouble remembering the details of the estimate later. Then, you'd have to analyze the job all over again, and that wastes time.

As always, using technology to be more efficient in processing estimates makes sense, but don't look for technology to make the sale. People buy through personal interaction and a clear understanding of your bid, not an emailed quote.

If you don't have an exact price because you have to check on a product's cost, then ballpark it and do a test close: "Looks like this is going to be between $5,000 and $5,500, how does that sound?"

Few estimating strategies will make a contractor's life more efficient and less stressful than calculating estimates on the spot. What's the worst that will happen? The customer will tell you, "no," and you'll try again with the next one.