Roofing profit margins

The IRS reports what one-owner businesses filing Schedule C earn, by sector. Roofing falls under Specialty trade contractors. For tax year 2023, 2,521,516 returns reported $257.8 billion in receipts, $80.4 billion in cost of sales and $40.5 billion in net income less deficit (the table gives thousands of dollars):

The owner's own draw is not an expense on a Schedule C, so that net margin is mostly the owner's wage, not profit on top of it.

Roofing is material heavy: shingles, underlayment, flashing and the dump fees come before any labor. A wet week or a crew that runs a day long eats the margin fast.

For a worked example, our roof replacement cost calculator puts architectural shingle roof, installed at $375 to $675 a square, typical $525, and treats about 58% of that as labor. On the typical price, that is about $306 of labor and $219 of materials, equipment and everything else, before your overhead and profit.

• Squares measured short, so materials run over
• Decking replacement left out of the estimate
• Dump fees and permits not priced in
• Crews paid for rain days with no work
• Warranty callbacks that are never billed

Ways roofers raise margin: measure every roof from above before the site visit; price decking replacement per sheet in the estimate; sell gutters and ventilation on the same job; book repair work in the slow weeks between replacements.

The typical national prices from our sourced calculators are a check on whether your prices leave room for margin:

Work out the margin on each line of your menu, not just the big jobs. The usual roofing menu: architectural shingle roof, installed; 3-tab shingle roof, installed; metal roof, installed; tear off one layer and haul away; leak repair and diagnosis; shingle replacement after wind damage; pipe boot and flashing repair; storm damage inspection; gutter cleaning on the same visit; ridge vent or attic ventilation; skylight reflash or replacement; roof soft wash.

Overhead comes out of the margin before profit. In roofing it includes general liability insurance, which Insureon's customers who are roofers pay an average of $317 a month for; commercial auto at $268 a month on the same figures.

Put one recent roofing job into the calculator above, or switch it to "My margin for the year" to set your year next to the IRS benchmark. A 50% markup is a 33% margin; the markup calculator shows the rest.