The commercial roofing market has not been the best place to be over the last 16 months or so in many areas of the United States. Though immediately after the “opening” of the country saw a spike in business, that demand is starting to drop off, leaving many looking for ways to keep companies moving forward.
There are a number of reasons the commercial roofing market is currently down.
Supply Issues. We are all well aware of the supply chain issues our industry is facing. Unfortunately, it is not just our industry, but a vast part of the nation as a whole. Supply issues lead directly to cash-flow issues, particularly with commercial businesses. This is completely outside the control any of us have, and we will simply have to let the issue run its course.
Economic Concern. Business owners throughout the country are aware of the fluctuations of the economy. There is an extremely high level of uncertainty about the direction the economy will be moving over the next year or two. This leads many owners to a decision to hold on to capital and reduces investment in improvements.
Small Business Decline. As many as 1/3 of all small businesses have closed since the beginning of the pandemic. Whether a temporary closure due to financial hardship or a permanent loss, the fact remains there are fewer commercial businesses out there. Fewer businesses clearly mean fewer opportunities for the commercial roofing industry. A recent study found up to 57% of small businesses still in existence could permanently close due to the Delta Strain resurgence.
Demand. Years 2018-2019 saw an unprecedented number of commercial roofs replaced or restored. This high level of work during that timeframe means all those roofs are not in need of service at this time. This also reduces opportunities for the industry right now.
Ways to Keep Financially Afloat
In spite of all the doom and gloom, one of the strongest assets the commercial roofing industry has is the NEED for roofs. Every home, business, industrial complex or building of any type requires a roof. Those roofs must be installed, maintained, repaired and protected. As a result, we have a built-in bumper against the issues that may plague other, less critical, industries. It’s only a matter of time until service is REQUIRED.
To weather the existing storm requires a re-evaluation of direction, both for your company overall as well as your marketing plan.
Here are a few ways you may consider keeping the income streams flowing in.
Residential. Yep, we went there. While the commercial marketplace is staggering, the residential market continues to jump. With significantly more pent-up demand, a much larger potential client base and the unfortunate recent catastrophic storm events hitting regions of the country, residential roofing may be a direction to move, at least temporarily.
Most commercial roofing contractors began as residential roofers, so the learning curve really isn’t an issue. The equipment needs are reduced as well, plus the timeframes for roofing materials are not as long as those in the commercial roofing arena.
Diversification is key in many industries, and it may be time to consider diversification in your own roofing business.
Niche Specialization. Fancy words, but basically, we are talking about finding a specific area and focus your primary attention on that. For example, if you live in the desert Southwest, combining solar power with roofing services may be a key niche in your area to consider. Another option might be a heavy promotion of wind-resistant systems in an area recently hit with a lot of storm damage.
This step requires some research on your behalf into your local market. The most important thing in niche specialization is a true understanding of what needs exist that aren’t being met, then finding a way to meet those needs effectively.
Those companies that meet unmet needs quickly and effectively are the companies that will not only weather the existing storm, but will actually grow and benefit from the situation. Reduced competition helps ensure more opportunity for you to actually get the project, though there may be fewer projects available.
Marketing. It is a natural tendency for business owners to pull back on marketing as “unnecessary” when faced with an uncertain time. Consider this…if your competition is pulling back but you aren’t, which business will reap the benefit when an influx of roofing opportunities come up?
The difference is you need to carefully target your marketing. Rather than a “here we are” approach, it is crucial your marketing sets you apart from your competition and truly addresses why you are the best choice.
Additionally, if you are expanding your services (such as pursuing residential options) or moving into a more specialized area, your marketing campaign truly needs to focus on those areas. You want to shout it from the rooftops (so to speak), so anyone potentially interested in those services knows you are offering them.
A few inexpensive ways to increase marketing include:
- Increase the number of blogs or posts you put on your website or social media. If you aren’t a blogger, look through some of the blogs on the Choice Roof Contractor Group and upload to your own social media. You definitely want to show strong activity on social networking platforms. It will instill confidence when building owners research your company.
- Offer a “special” on certain services and promote the heck out of it via an email blast. If you aren’t certain how to do this, reach out to us. We have plenty of tips for you.
- Offer a discounted rate to referred customers and a thank you incentive to referrers. This can be promoted through your website, with 1-page flyers or with a mail campaign. Give us a call for more ideas.
- Print up some flyers and place them strategically in your area. Quality truly counts when it comes to your flyers. They will directly reflect on the perception of your business. Don’t take the cheap home-made route.
The good news is the commercial roofing arena is expected to improve drastically in the near term, assuming no additional pandemic issues arise. Positioning yourself and your business to not only get through this time but be prepared for the upswing is the hallmark of a great businessman.