John Kenney, CPRC, CEO, Cotney Consulting Group
In the roofing industry, adaptability is not just a competitive advantage but a necessity. Economic conditions fluctuate, impacting material prices, labor availability and client budgets. To stay competitive and maintain profitability, roofing contractors must adopt flexible strategies to adjust quickly to these changes. This article explores how roofing businesses can better navigate economic shifts and improve operational efficiency, ensuring long-term sustainability.
Macroeconomic vs. Microeconomic Factors
Roofing contractors face two fundamental economic forces: macroeconomic (overall economy) and microeconomic (business-specific) conditions. Macroeconomic shifts, such as recessions or inflation, affect
material costs, customer budgets and the demand for roofing services. While contractors have little control
over these broad trends, microeconomic factors such as workforce management and operational efficiency can be directly influenced.
For example, suppose the price of roofing materials like single-ply membranes or insulation skyrockets due to global supply chain issues. In that case, you might pass those costs to clients or renegotiate vendor contracts to secure more stable pricing. By recognizing these two levels of economic impact, contractors can better anticipate challenges and prepare actionable solutions.
Developing flexibility in your operations is critical to thriving in fluctuating economic climates. One important
strategy is dynamic resource allocation, where resources (both financial and human) are shifted according to the moment’s demands. For example, during an economic boom, you may need additional labor or subcontractors to handle excess demand. During downturns, focusing on maintaining a lean core team can prevent overhead costs from spiraling out of control.
Another important tactic is client diversification. Contractors who rely heavily on a few key clients can suffer during economic downturns when these clients reduce their budgets. By broadening your client base to include residential and commercial projects or entering niche markets like solar, you can create a more stable flow of projects.
Streamlining Workflows
Operational efficiency is the foundation for increased profitability, especially during uncertain times. One of the first steps toward efficiency is optimizing workflows in the office and on the jobsite. Start by reviewing repetitive tasks that take up unnecessary time, such as manual invoicing or scheduling. Implementing automated solutions like project management software or invoicing tools can cut down on administrative overhead and free up time for more critical tasks.
For onsite efficiency, lean management techniques can minimize waste and maximize labor productivity. For instance, better jobsite planning can reduce material waste, while scheduling tasks to avoid downtime keeps your workforce productive throughout the day.
In today’s tech-driven world, embracing the right technology can be a game changer. Cloud-based project
management software lets you track project progress in real time, improving communication between your team, clients and suppliers. Digital take-off and estimating tools can also help you accurately estimate material needs and prevent costly errors during installation.
By integrating technology into every phase of your roofing business, from project planning to execution, you can reduce delays, improve accuracy and enhance client satisfaction. Using drones for roof inspections, for example, is one way contractors can cut down labor hours while providing faster, more accurate assessments.
Adapting Leadership Styles
Leadership is crucial to the success of any roofing operation, particularly during economic fluctuations. As a business owner, your leadership style must evolve to meet the market’s changing demands. During tough economic times, being transparent with your team about business challenges helps foster a culture of trust and adaptability. This transparency lets your team understand the importance of operational efficiency and motivates them to contribute ideas for improvement.
On the other hand, leadership during prosperous times requires a focus on scalability and opportunity. This means hiring strategically, investing in training and ensuring your core team can handle increased workloads without compromising quality.
The success of any roofing project depends on the performance of your team. Building a resilient team that works under pressure is essential during market shifts. Offer training programs that upskill your workers,
particularly in new technologies or sustainable building practices. Encourage collaboration and foster a team environment where workers feel empowered to contribute ideas for improving efficiency or cutting costs.
Implementing Change Effectively
Adapting your business to economic conditions requires more than theoretical knowledge – it demands action. Contractors who successfully weather economic storms often do so by implementing strategic changes efficiently. Whether adopting new technology or diversifying your client base, real world application of these strategies is key.
Consider the example of a roofing contractor who introduced solar panel installation services in response to the growing demand for sustainable roofing solutions. This move diversified their service offerings and helped future-proof their business against economic shifts.
Adapting to economic fluctuations is not an option: it’s a necessity in today’s roofing industry. Operational
efficiency, leadership adaptability and strategic client diversification are critical tools in a contractor’s toolkit.
Stay tuned for part two of this series next month, where we’ll explore how to future-proof your business and embrace innovation for long-term success.
John Kenney, CPRC has over 50 years of experience in the roofing industry. He started his career by working
as a roofing apprentice at a family business in the Northeast and worked his way up to operating multiple Top 100 Roofing Contractors. As CEO, John is intimately familiar with all aspects of roofing production, estimating and operations. If you would like further information on this or another subject, you can contact John at jkenney@cotneyconsulting.com.
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