Underbidding is a common problem faced by the Roofing Industry nowadays. Most contractors not only underbid the job but undercut their profits as well. One of the major reasons behind this is that the roofer’s price by the number of squares instead of pricing by the time it takes them to get the job done which leads to them underestimating their overhead. Unprofessional bids are another mistake that the roofers make. There is a 90% chance of you underbidding a roofing job if you are unsure about roofing business pricing strategies.
The good news is you can always learn how to price and bid roofing jobs and attain a profit.
For effective pricing on the roofing job you need to follow this process:
1. Properly understand the scope of your work
Inspecting the Roof
Determine the existing condition of the roof. If the flashings can’t be reused, then make sure to factor replacement flashings into your material costs. Identify all the unusual roof features, the condition, and the number of the valleys and all the damaged areas. Note down the number and condition of the vent stacks, eaves, and ridges. Also, determine whether the roof requires a complete tear-off and whether the existing materials can’t be used or not.
Checking the Building Codes
Check the building codes to determine whether the existing layers can be shingled over and if the building codes allow another layer then make sure that the shingles are in good condition to support another layer. If another layer can’t be added that make sure to factor removal costs into the total estimate. Also determine which materials and colors are restricted by the Building Codes.
2. Get the accurate measurements of the Roof
Calculating the flat area of the Roof
Stand on the ground and measure the exterior of the house. Use these measurements to calculate the total area of the house. Then you need to divide the area of the home by 100 to find out the total number of squares. 1 square is usually covered by 3 shingles. Most of the residential roof are however pitched and we need to factor in the Roof Pitch into our calculations.
Determining the Pitch of the Roof
The roof pitch is the steepness or the slope of the roof that is created by the rafter. It is a measurement of how much the roof rises as compared to the horizontal measurement of the roof, also called the horizontal run of the roof.
A ratio of 6:13 means that the roof rises 6 feet for every 13 feet of the horizontal length of the roof. The roof pitch can be either low, medium, or high. You need the measure the pitch of the house’s roof. Low pitch roofs have a ratio of 5:12 or less. Medium pitch roofs are in the ratio 6:12 or 9:12. High pitch roofs have a ratio of 10:12 to 12:12.
Determine the Roof Pitch Multiplier
The Roof Pitch multiplier is a number that is multiplied by the square foot area of the sloped roof to produce the actual surface area of the roof. A roof pitch multiplier chart is used to find out the pitch multiplier to which the ground level squares of the house’s roof, that is calculated, is multiplied to. Low pitch roofs are multiplied by a factor of 1.15 to 1.25. Medium pitch roofs are multiplied by a factor of 1.24 to 1.4. And a factor of 1.4 to 1.7 is used for high roof pitches.
3. Estimating Material Costs
Determine the Materials Needed
After you have the measurements of the roof, you will need to determine the type and the quantity of the required materials. List these materials down and calculate the total cost of materials. The material’s list usually includes Shingles, Nails, Flashing, Underlayment, Moisture Barriers, and Dumpsters for Shingle Removal.
Calculating the Material Costs
For estimating the total number of shingles required, you will use the square footage of your house you just calculated above. The total number of squares will tell you how many shingles will be needed to cover the entire roof. Underlayment is another vital roofing material that is placed underneath the shingles and acts as a second line of defense against water damage to the roof. Once you have the total square footage of the roof you can use it to estimate the amount of underlayment. One roll of underlayment covers 4 squares. So by dividing the total number of squares by 4, we can find out the total number of underlayment required. Since Nails are sold by the pound, you will require 2 and a half pounds for each square. The most common roofing material is asphalt shingles but solar tiles, metal roofing, and rubber slate are also used. Contact your supplier to get the square footage cost of the roofing material you are using. Sum up the cost of all the materials you are using to get the total cost.
4. Estimating the Labor Costs
For estimating the labor costs you need to first determine the labor hours, which are the hours the job will take, and then multiply it by the total number of employees on the job. Now you will need to work out the hourly labor cost. The hourly labor cost will include both the worker’s wage along with the taxes and worker’s compensation. Once you have the labor hours and the hourly wage, you will calculate the total labor cost by multiplying the labor hours with the hourly wage.
5. Estimating the Overhead Costs
Overhead costs include the costs for uniforms, accounting, rent, insurance and tools. For your business to be profitable, the price you charge must include the cost for all of these.
6. Determining the Total Cost and Adding Markup
Add all the costs you just estimated in order to get the breakeven cost the roofing job requires. Add a markup into your total cost so that you can profit from the services you are providing. Markup is usually expressed as a percentage and it is calculated using the formula Profit/Cost * 100. The markup percentage you chose to add to the breakeven cost depends upon the Profit Margin. While pricing the roofing job, one must aim for the margin above the industry average which is 6%. You need to markup your total cost with a percentage greater than the margin to achieve your desired margin.
7. Creating a Professional Roofing Bid
Once you have arrived at an accurate price for your roofing price, you now need to create a professional bid that will convince the customers that you are the best among your competitors in the services that you provide. Your roofing bid must include a breakdown of your services, costs, and the materials, your and your clients contact information along with the client’s name, your business name and logo and the bid’s expiration date. You can also include any advance payment that you might require before starting the job.
Paramount Estimating Roofing Services
Paramount estimating provides professional estimating services while staying within the budget when it comes to compensation. Your satisfaction is our priority. We offer estimation services with an accuracy rate of 99.99% and our turnaround time is just 24-48 hours. We offer our services to all kinds of residential and commercial buildings irrespective of the size. Our estimation services extend across the USA to General Contractors, Sub Contractors, Architects, Consultants, and House Constructors. We will help you save a lot of time and money and you will get very competitive rates for takeoff. So the next time you are in need of a professional to provide with you accurate satisfactory estimates make sure to contact us.