A month or two ago, we got hit with a hail storm, which was concentrated in one large 10-15 year old subdivision. I’ve gotten several calls to price re-roofs in this area (I’ve done one for a previous customer who refused to get any more prices – she’s the office manager for a large law firm), but I’ve priced several more of these jobs and I get laughed at.
Several out of town storm chasers have moved into the area and are going door to door giving on the spot estimates. The sales people are driving Hummers and the crews are driving brand new F350’s bought locally. They are all staying in motels and buying materials at the same prices I do and are paying the same disposal fees. They are charging $140.00/sq to do what I have to charge $309.00/sq for. I have also heard (can’t substantiate this) that they are paying the adjusters $200-$300/job for referals.
They’ll be gone in a couple of months and I don’t want or need this type of business, but I’m curious. How do these guys make a profit? One bunch is from LA, another from IN, and another from TX, I believe. I’ve noticed that they’re not replacing drip edge (which is spec’d by the insurance company to do so) and they’re not re-felting. They’re using 3 tabs for ridge caps on dimensional roofs. If they cut those corners and a few more I can’t think of, they can gain $50-60/sq on me at most. How are they doing it?
Replies
We're only paying our crew thats up there about $10/sq. If they cant make a living on that then thats just tough.
No seriously, we had the same thing happen here when Rita hit. All that will be left will be the ones that have no insurance and have to save their money.
That and call backs after they leave. In fact I've got one of those tomorrow.
I dont know how they do it. they cnt be paying much for the labor. The one I've got tomorrow has three tab ridge on 40 year shingles too. Most of these companies change their name like they do their socks.
Its partly what gives the good guys a bad name.
Here inTexas, we have a lot of the same thing going on.
Most of these guys are not carrying the required insurances such as workers comp, general liability, vehicle. They aren't registered with the TRCC, have no state licenses or city bonds.
Also what we see a lot of is illegals on the job sites. They pay these guys a minimum rate. Heard from some it can be lower than minimum wage.
Don't see how someone can do this to someone else. I personally couldn't sleep at night.My brain + his brawn = a perfect team
They are charging $140.00/sq to do what I have to charge $309.00/sq for.
I wondered the same thing when we got hit by hail last year down in Texas - roofing companies were giving me unsolicited bids of $2700 to strip, re-paper, new drip and new three tab shingles on a roof that is 33 sq!
I'm sure they were going to leave some of those things (drip, paper, 4 nails to a shingle) out even though the bid included it but WTF, still don't know how they'd do it for that kinda money.
I'm guessing no insurance, no warranty, no flashing, paper, nails................
Doug
Edited 8/6/2007 8:57 pm ET by DougU
Wow, that's cheaper than it was here.
I think we were getting some of the rejects from over your way. Some of them told me that they had been over in the Houston/gulf area but didn't like to be that far away from home.
I didn't know what to believe but I just couldn't wrap my mind around the idea of doing a 33 sq. roof for $2700!
Didn't matter though, my insurance company went belly up and I never collected a dime on the roof. New homeowners requested that I replace less then 100 shingles(we had a two year old roof when the hail hit) when we sold the place, had that done for $600 and I was tickled to pay that!
Doug
When they leave the customers think everybody should do it for those prices.
And the wages those guys had to be making....unbelieveable.
Or maybe not.
About 15 years ago we had a wall framed the whole length of the house. I think it was about 50' or so. We were going to stand it on Sat. but the boss paid everybody on Fri. so only me and the boss showed up.
There were three guys across the street drinking beer and the boss told them he'd give them $20 to help stand the wall up. They of course refused as they couldnt be bothered.
So then he said "How about a half a case of beer then".
Then they almost tripped over themselves getting over there to help.
A half case was going fro less than ten bucks back then. I learned a lot about human nature that day.
Another thing to remember is that $2700 was the upfront quote. What's the actual cost when the roof is already torn off and they ran into "unexpected" problems?Because I'm sure *that* never, ever, ever happens. ;-)And what cost advantage is there from not providing a warranty? Yes, we know they *say* there's a warranty but you can't get something fixed when the company no longer exists.Glen
Grant,
Same deal here. We had an F4 Tornado in March and within hours a company had adds on TV. He drove a Hummer(difficult to type w/o cracking up) with advertising on it. His Supers and Leads all had $40K plus vehicles. I talked with a couple of roofers I use, and they said 'He follows the storms'. Jesse, my #1 roofer, told me ******* Roofers got paid $4.5M to blue tarp tear downs in LA after Katrina. He tarped them in a month with 2 5 man crews. The Insurance Companies know him, and let the work to him.
Heck, every job I saw this company do in March and April had a bunch of wet back workers. Our BOs are spineless and don't check for papers. They say, 'Not my yob'.
Chuck S
Edited 8/6/2007 9:51 pm ET by stevent1
He drove a Hummer
Hmmm..
Thats where my FEMA blue tarp money went.
Get that guys # My GC's is no longer in service.
Sure would like to take it out of someones hide.
Mothers house, central IL, small tornado damage.
Also wanted to tear off built in gutter and re-frame rotted edge.
Live 2000 miles away, brother tried to get bids. Contacted 7 local outfits, 1 guy looked, nobody bid.
Anyway, re-roofed only the south side, about 10 squares IIRC.
Brother, self, and son (who flew from Oregon to help Grandma) took about total of 50 hours to do the work - with only two nailers between the 3 of us.
Framing materials all available in Pop's old lumber piles
Roofing materials cost about $600 from Menards, son's labor rate as computer consultant is $500/hr (yes five) , so we';da had to 'bid' over 50K <G>, but at $10 hr would only have been $1.1 K.
All relative to time and opportunity. We would have welcomed a couple of 'storm chasers.
Thank's for telling that story again, but nothing in it is relative to the question I asked.
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