Roofing Business Profitability & Burden Shield

Overhead burden includes your non-job costs: office rent, insurance premiums (GL/WorkComp), administrative salaries, and fuel. Most contractors fail because they only track Labor and Materials. Facturing in a 15–20% burden ensures you aren't just 'trading dollars' but actually building business equity.

Commission leakage occurs when sales reps over-promise or fail to account for supplemental material costs. By using a 'Net Profit' commission model (rather than a 'Gross Sale' model), you align your sales team's incentives with the company's bottom-line health.

Target a 20–30% gross margin and a 10–15% net profit margin. In a volume-based business, a 10% net profit is the 'Safe Zone.' If your net margin is consistently below 5%, your overhead burden is likely too high or your per-square labor rates are outdated for the current market.