How do roofers price?


#1

I’m fairly new to the roofing contracting business, and am growing slow due to still being in school. I want to make sure that I am charging the right amount, and am not low balling customers. (Both because of profit, and because I don’t want to depress prices in my area) I am currently charging, 75$ per sq of shingles, 80 per sq of labor, and everything else is prices exactly what it costs. I am looking to this community for insight on your pricing methods. Like how do you cover Liability and Workers Comp? I am in the SE U.S. If that effects the pricing.

Looking forward to hearing from you guys.


#2

Cost of materials and sales tax; cost of labor, fuel costs, incidental costs, permit costs, labor burden costs (WC and payroll taxes) all totalled up along with any costs peculiar to your business and market.

Add in you profit margin plus your overhead as some sort of percentage of the preceding items.

Your GL costing formula will be based on how you are charged by your GL carrier. Is it based on your labor payroll or based on your gross sales? Depending on how they charge you, you will add in payroll based GL in the first section as a line item.

Or, if you are charged on gross sales, you will divide your “almost” sales price (all of the stuff previously mentioned but without payroll based GL) by the percentage rate your GL carrier charges you, inclusive of GL sales tax, stamping fee and the other “extras” your GL carrier charges above and beyond your actual rate per $1000 of GROSS sales. Then, in this 2nd GL insurance cost model, you will have your final sales price.

Remember, if you pay GL on a gross sales basis, the percentage rate they charge you will come right off the top.

Example: All costs and mark up / margin equals $10,000.00 and you pay on a gross sales basis and that basis is, say, 2% then take $10,000.00 and divide by 1.00 - 0.02 (98%) and your ultimate sales price is $10,000.00 divided by 0.98 OR $10,204.08.

Now you owe 2% of $10,204.08 straight off the top to your GL carrier. 2% of $10,204.08 is $204.08 and that leaves you with $10,000.00 to pull off the job. Don’t multiply $10,000.00 by 1.02 to get $10,200.00. You’ll still have to pay the GL carrier 2% of $10,200.00 which is $204.00. Now you have $9,996.00 to pull the job off.

Good luck.


#3

Also, NEVER quote a job “x per square.” Quote a job for a price.

Use “x per square” as a back up for your own review to make sure you don’t get an outlier that is way beyond the YOUR norm. “x per square” is a back up for you to check your own math.


#4

You will learn with experience. One thing always keep in mind to give quality work to client. And the cost depends on material,labor etc.

Good Luck and Thanks

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