Smart guys get that little bit extra out of their business. Most businesses work on a gross margin that they are pretty clear about, but ‘stuff’ happens – we all know about that.

Getting cranky about it doesn’t fix it. Staff training helps. Identifying the little things that nibble away at your profit margin helps too. Finding new and more effective and efficient ways of doing things also helps. Just because your Pa and his Pa did it a certain way doesn’t mean that we can’t make it better if we just try.

“If you’re okay with how things are running in your business and can’t be bothered finding the small improvements to increase your margins, then don’t read on.”

Ray Smith

There is no shame in admitting that we don’t know or understand something. If you figure something is not quite right, then ask the question! Whilst I am no business ‘guru’, I have helped people all around the world to make incremental process improvements in their roofing businesses that make a huge positive difference over a year, and every day after successful implementation.

What is your annual net profit in your business each year? 5, 10, 12%? How would you feel if you could do quite a bit more than that, just by doing things a little differently, doing things smarter?

Many services are ‘out there’, selling you more leads, “get more business, make more money!!” That’s okay if you’re already making 20% or more, net profit, each year, but what if you barely make salary on each job? All you are doing is working yourself to an early grave and not enjoying the many pleasures of life. Okay clever guy, what do I do?

What about we start by looking at how you estimate the cost of doing a job?

• How about if you could improve the margin on each job simply by delivering all the correct materials to the job the first time or even costing the job correctly the first time, so you don’t have to figure out how to get ‘variations’ approved. 
• How about reducing the amount of ‘scrap’ that ends up in the trash bin? 
• How about giving the installation crews documentation to ensure that they get the job done right and in the most efficient manner, with less mistakes that require another trip to get more ‘stuff’.  On bigger jobs, deliver just the materials required when they are required, so that material isn’t sitting around to get stolen or damaged. 
• What if you could integrate the entire quoting process into the business management system so that you don’t waste time re-entering details that are sometimes incorrectly entered in that process?

These are just a few things that spring to my mind when I think about the stories that have been relayed to me over the years. There are no doubt dozens of other little things that you have encountered that might be easily fixed if we focus on finding a solution. We all know the saying about doing the same thing over and over and expecting a different result. Let’s not do that.

Some things simply must be changed and if changed the right way, help you move forward in a more positive way. One such example is the age-old way of quoting jobs based on dollars per square. That is a game of averages and doesn’t stand up to long term good practice – you win some and you lose some.  The issue here is that you lose some! I would argue that you shouldn’t lose any, just employ better systems so that you are a winner on all jobs. Any job where you lose money, you’re doing the next couple of jobs for nothing!

Use a system that accounts for the little things that eat away at your profit margin. Reduce waste on the metal panels. Systems exist where you can map the layout of panels and show the installers where the off-cuts go. The panel layout ‘map’ reduces the errors and reduces waste to virtually zero. Every bit of ‘scrap’ in the trash is real money thrown away, and with one cut, you have two panels to install.  Efficient!  What about accurately accounting for all your flashing and trim accessories correctly, so that the gutter guy has everything to complete the job the first time he visits the site. More importantly, that all these ‘odds and ends’ are built into the quotation the first time – the ‘Goldilocks quote’. Not too much, not too little, everything just right. 

Implement the right system and you improve your net profit just by reducing the little things that eat away at the margin. You don’t need huge or dramatic change; you just need to fine tune what is working already.

This is what you get when you have the type of setup that does all this for you, and these systems do exist, have been in use for years and years and are working for roofing companies just like yours all around the world.

Ray Smith