How to start a roofing company: A step-by-step guide
- Defining your business and organizing your thoughts with a business plan will put your roofing company on the right track
- You must register your business, obtain licenses and permits, and get the appropriate insurance before launching your company
- Setting up a website, Yelp Business Page, and referral program can help you acquire and retain customers
The roofing industry is on the rise with expected revenue of $20 billion in 2021. Entrepreneurial roofers like you might be wondering how to start a roofing company so that you can take advantage of this growth.
This step-by-step guide explains everything you need to know to turn your business idea into a reality. From choosing a business name and obtaining proper licenses to marketing your brand and creating online profiles, you’ll learn how to reach potential customers and grow your roofing business into a profitable venture.
How to start a roofing company in 11 steps
There are a lot of questions to ask when starting your own roofing business, but the process can be a lot easier once you have some steps in place. You’ll start out by defining your business, writing a business plan, and incorporating your business. From there, you need to obtain all of the necessary licenses and begin marketing your services to potential clients. Here’s how to start a roofing company and find your first clients.
1. Define your roofing business
The first step to starting your roofing business is defining exactly what type of company you want. Decide which services you’ll offer, which customers you’ll serve, and where you’ll be doing business.
Choosing your roofing services is relatively straightforward. As a roofing contractor, your primary duties will likely be roof replacement, repairing roof damage, and conducting roof inspections. However, you can set yourself apart from competitors by specializing in certain types of roofs like metal roofing, slate, or even solar tiles.
Determine which target market you’ll be serving. Will you focus on residential roofing clients or seek out bigger commercial roofing contracts? Commercial contracts may be harder to come by, but they have the potential for a larger payout.
To avoid spreading yourself too thin, narrow your focus to a specific service area. You can then expand once your business starts taking off.
You need to also come up with a professional business name before you can proceed to register your business. Come up with something unique that clearly describes what type of business you have—for example, “Right-Away Roofing.”
2. Write a business plan
If you don’t know how to start a roofing company, a business plan is a great start. It will help you organize all elements of your business before taking the plunge into entrepreneurship. Examine all aspects of your business, and use it as a roadmap. Your business plan will come in handy if you ever need to seek funding from banks or third-party investors.
Here are the eight core sections to include in your business plan:
- Executive summary: Outline your entire business plan, and give a description of your roofing business, competitive advantages, and the current state of the market.
- Company description: What makes your business unique? What value can you offer customers? Tell readers which customers you plan on serving and why your business will succeed.
- Market analysis: Examine the current state of the roofing industry to determine the viability of starting your own roofing business. Analyze your competitors and break down their strengths and weaknesses.
- Organization and management: Choose the type of business entity you’ll form, and create an organizational chart of your leadership team.
- Services: How will your business make money? Explain the services you’ll provide customers and how they will solve their pain points.
- Marketing and sales: How will your roofing company attract and retain customers? Pick a few marketing channels that best suit your business goals, and avoid implementing too many marketing strategies simultaneously.
- Financial projections: Give a prediction of your pricing and expected sales for the next five years. Anyone reading your business plan should understand that it will be financially stable and eventually profitable.
- Funding request: You only need to include this section if you plan on seeking business loans or funding from outside investors.
3. Register your business
You can choose to start a sole proprietorship, partnership, limited liability company (LLC), or S-corporation. We recommend pursuing an LLC business structure due to the unique benefits it offers small business owners.
Limited liability companies allow you to pass income to your personal tax return without being taxed twice—once on your personal tax return and again on a business tax return. It also protects your personal assets if your company is under financial distress or an outside party takes legal action against your company.
4. Apply for an Employer Identification Number (EIN)
An Employer Identification Number (EIN)—also known as a Federal Tax Identification Number (FTIN)—is used by the Internal Revenue Service (IRS) to identify your business for tax purposes. Your unique EIN is a nine-digit number that is required when filing your business taxes.
You must obtain an EIN if you plan on hiring employees or are registering your business as an LLC. You can apply for your EIN online at the IRS website.
5. Open a business bank account
It’s imperative to keep your roofing company’s finances separate from your personal finances. A business account allows you to keep all business expenses and payments in one place without getting mixed in with your personal finances.
Your personal assets may be at risk if your personal finances are combined with business finances. Assets like your home, vehicle, or personal investments could be unprotected in the event of financial hardship or legal action from a third party. However, a business bank account helps you avoid such messy situations.
A business account also lets you accept payments, sign up for a business credit card, and build credit. Keep in mind that you’ll need to register your business and receive an EIN before you can open a business bank account.
6. Acquire insurance coverage
Roofing can be a risky business, so it’s best to ensure you’re completely covered in case anything were to ever happen.
The following insurance policies can be purchased for your roofing company:
- General liability insurance: Covers customer property damage, injuries, and other similar lawsuits
- Sub-contractor liability insurance: Similar to general liability insurance but it also covers any damages or injuries caused by subcontractors you employ
- Worker’s compensation: Covers employee injuries or illness caused on the job
- Vehicle insurance: Covers any vehicle-related accident
- Umbrella insurance: Offers additional coverage that protects you if damages or injuries exceed all other insurance coverage
7. Obtain the necessary licenses and permits
Certain business permits and licenses are necessary to legally operate your roofing business. These permits and licenses will vary from state to state and can be obtained through your local city hall or office.
You’ll need to acquire a local business permit and a state contracting license. Both allow you to legally do business in your state and will have different requirements depending on where you are.
8. Promote your roofing business
Different types of print marketing, signage, and additional branding elements can help build brand awareness in your local area.
Building relationships with potential customers face-to-face is one of the most impactful ways to find your first clients. Make sure to have professional business cards on hand whenever you’re networking.
Print out a stack of flyers that include your logo, company information, and a first-time customer discount. Canvas your local neighborhoods, and distribute flyers.
You can also create decals to put on your work vehicles and order company uniforms with your logo.
9. Design a website
Your website is the online face of your company. It has the ability to draw in potential leads and convert them into paying customers.
A well-designed website is clearly organized and makes it easy for a potential customer to find any information they may need. Segment your site into the following five core sections:
- Service areas
- About your company
- Contact details
A company site also helps set your company apart from the competition. Be clear about the unique value you can provide customers in a single statement. As soon as a visitor arrives on your site, they should find a brief value statement, like “Leak-free roofing solutions that last for years.”
You can build your website using site builders like Wix, Squarespace, or WordPress.
10. Claim your Yelp Business Page
A Yelp Business Page gives your previous customers an outlet to leave a review of their experience with your roofing company.
Prospective customers will also use your Yelp Business Page to read through reviews to determine if they want to hire your company to fix their roof. Over 90% of customers read reviews of local businesses to determine their overall quality.
As a business owner, you have the ability to post information about your roofing company, like a business description, contact details, and photos from previous roofing jobs. You can improve your customer service efforts by responding to customer reviews and solving any issues previous customers may have had.
Claiming your Yelp Business Page only takes a few moments and will expand your reach across the web. You can also take advantage of these free online advertising opportunities.
Get a free Yelp Page Promote your business to local customers.
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Promote your business to local customers.Claim your free page
11. Launch a referral program
A referral program is one of the best ways to attract new roofing work when you’re first starting out. New customers are four times more likely to make a purchase after being referred by a friend.
Your referral program can be as simple as offering a 10% rebate if a current customer refers a new client. The referred homeowner can also receive a percentage off their bill for being a first-time client.
You can build a successful roofing company
Starting a new roofing business is an attainable goal that has great potential for success. Start by ironing out the finer details and writing a business plan.
Then, incorporate your business, and obtain all of the necessary licenses and permits. The final step involves building a website and marketing your services to customers in your area.
Now that you know how to start a roofing company, it’s time to find your first clients and grow your business. Stick to the plan, and soon enough you’ll be your own boss with happy customers who refer you time and time again.
The information above is provided for educational and informational purposes only. It is not intended to be a substitute for professional advice and may not be suitable for your circumstances. Unless stated otherwise, references to third-party links, services, or products do not constitute endorsement by Yelp.