There were times when it seemed impossible to link companies across the vast territory of the United States. National companies are now the norm. Innovations in systems management and intricate business models have been refined into category killers — companies that dominate business segments or entire industries. Retail, finance and service businesses are consolidating to offer a national presence, and roofing contractors are no exception.
There have been several examples of how to create a contracting organization with a national footprint that meets a new trend: clients who demand a single source to keep thousands of buildings dry. The recent belt tightening in corporate America means shifting much of the maintenance and tracking to outside sources, which can effectively manage roofing systems and energy savings while responding to leaks in short order — all with one phone call.
“These retailers want to know you can cover them, no matter where they are,” said Dale Tyler, president of National Roofing Partners, a network of more than 60 independent contractors with over 100 service locations headquartered in Dallas. “Believe me, they do not staff these facilities like they used to. That’s a real paradigm shift.”
There are just a handful of organizations that could be said to have a true national presence in the roofing industry. CentiMark and Tecta America are two large contractors that cover the entire country — they are top-down corporate structures that have purchased and expanded firms to broaden their reach. This article will focus on another approach that taps into the combined power of independent contractors. RoofConnect and National Roofing Partners are affiliate groups that allow contractors to maintain ownership of their firms while tapping into the resources of a super association.
Purchasing power is multiplied, reports are uniform, and the ability to join forces with fellow contractors who aren’t out to eat your lunch is reassuring. “RoofConnect allows an individual member to keep their identity and work with national accounts across the country,” said David Workman, president of RoofConnect, which is based in Sheridan, Ark. “This gives them an opportunity to become a national provider.”
Founded in 2002, RoofConnect has more than 110 locations with thousands in its workforce, including a national sales team that can personally call on facility managers, some of whom must oversee thousands of buildings. To service them requires computer tracking programs, electronic billing, a call center and sophisticated technical support. When there’s a roofing problem, building owners want answers, not an answering service.
“RoofConnect members have to be committed to service,” explained Workman. “They have to answer their phone.”
To keep in touch, there are e-mail notices and regular meetings where company presidents can share tips, share employees and develop best practices without worrying about losing business. New ideas are field tested before being implemented company-wide and some contractors are taking them directly to the marketplace. Safe Pro, a sister company to RoofConnect member Supreme Roofing, markets an OSHA-approved roof hatch that will retrofit existing openings with something safer and more efficient. One of the biggest examples of innovation by a RoofConnect member company is a showcase of energy solutions for the rooftop installed by Burns and Scalo Roofing in Pittsburgh.
“It’s a competitive group, no doubt about it,” said Workman. “The interesting thing is we’re spread out, so we have a forum to come and share that information.”
A New Kind of Showroom
“The roof has been identified as wasted space,” said Jack Scalo, president of Burns and Scalo Roofing. “Now our customers are asking for more, like energy and environmental solutions.”
As a building owner himself, Scalo has put his money where his roof is. Thanks to a $500,000 matching grant from the State of Pennsylvania, he installed multiple low-slope materials on different parts of his company headquarters in Pittsburgh, then mounted several different energy saving configurations, like rooftop gardens, advanced daylighting systems and several different types of solar arrays.
“We’re trying to take a leadership role in roofing and show what it will become,” said Scalo. “I felt that we really needed to do it ourselves to prove that it does work.”
Each section of roof is monitored separately so that his company will collect real data on energy savings where the building usage and climate are identical. Installed in December 2010, Scalo’s showroom includes electrical meters and displays for potential clients that want proof that their investment is going to pay off. That ROI is crucial to the sale, and Scalo enjoys showing how solar can be among the safest investments around — with a decent return, too.
That is, until state credits expired last year. Building owners, who once could recoup up to 90 percent of the capital outlay within the first year, are now faced with paying more for solar arrays bought in 2012 (There is still a 30 percent federal tax credit that is valid through 2016). This dark shadow is part of austerity measures that many governors have been facing since the economic collapse in 2008. Governor Tom Corbett slashed spending in order to close a $4.2 billion deficit, and that included financial incentives for solar.
“We don’t think he’ll be able to hold that position long term,” predicted Scalo. “We think [solar is] here to stay. It’s not a fad and all states are going to have to have some kind of program. However, that is only one piece of the financial model. What we need is a federal policy.”
The Hole Picture
The focus for NRP is service, assessment and maintenance programs. Many clients have zero tolerance for leaks but don’t have the resources to oversee every repair or re-roof. NRP’s Tyler described a typical client, AutoZone, which has roughly 4,400 stores around the country. There are five managers to keep them running and roofing is not at the top of their list. To obtain and keep clients like that, jumping on a small repair is the perfect introduction.
“We lead with service,” said Tyler. “We will take that $500 work order and service that leak. Then we’re going to have an opportunity on assessment and re-roof.”
Reports complete with detailed measurements and photographs make reports an effective tool to show that status of a particular roof and offer a range of solutions. Many clients have been deferring replacements for years, and Tyler expects that there will be some catching up soon. When a company has a chance to look at the roofing landscape nationwide, the numbers are immense.
For instance, he estimates there are 10,000 banks, meaning several hundred will be needing roofs this year. With a quarter of a million cellular sites, that’s a tremendous inventory with zero tolerance for leaks. Taking on huge chunks of business like that can be daunting without proving one can handle the work.
Storms are another unpredictable feature that national roofing contractors can address. While some contractors salivate at the prospect of storm repairs, disruptions with employees and materials can dash those dreams. Having access to support crews with equipment, experience and materials can save the day and leave a strong impression for future work not related to hurricanes or hail. When a couple of storms hit the Northeast, including Hurricane Irene, a rapid response was critical. “In both cases, NRP organized crews from outside the area, pulling form a 7,000-plus contractor employee workforce across the U.S.,” said Steve Little, president of KPost Company in Dallas, as well as chairman of NRP. “If the contractor needs support, other contractors that are not experiencing the event can help out. If we get storm events, it’s going to affect the local clients as well as the national.”
The ability to summon large amounts of labor and materials quickly and efficiently is something that Little has been developing for years. For him, it was a necessary move to keep business because his national clients didn’t want to vet contractors every time they had a leak. Once building owners got a taste of one-stop shopping, there was no going back. Little, who was a co-architect of RoofConnect, began forming NRP in 2006 after starting KPost in November 2003.
“The contractors got together and said, ‘How do we fight this thing?’” he explained. “Part of it was defensive, but part of it was also to take advantage of opportunities. It was a conscious decision for these contractors to bond together. It was important to set a standard for the roofing industry and it’s very profitable and comforting to have this in place.”
When Tim Rainey of Supreme Roofing in Dallas met with other founders of RoofConnect in 2001, they were familiar with each other through the NRCA. They agreed that it would take a real commitment to service in order for this venture to work. Rainey learned how important a reliable service crew can be when he started making repairs in 1987. Even if the leak turns out to be unrelated to the roof, follow through is important.
“You have to stay there and help get it repaired. The people servicing the job understand that,” said Rainey, adding that they are also expected to take measurements and pictures for future use. “You locate and report other things that may be a concern to the building owner while you’re there.”
While some may lament the Highlander concept of today’s business landscape (“There can only be one!”), there is still a tremendous amount of diversity, especially in a fragmented industry such as roofing. Contractors have a variety of choices to configure their business to meet the coming challenges. National organizations such as NRP and RoofConnect have not only serviced Fortune 500 clients, but done a service for the roofing industry as a whole.
“It’s something we’ve all been working on, improving the roofing contractor image,” said Rainey. “This has helped all of us.”
For more information about NRP, visit www.nationalroofingpartners.com.
For more information about RoofConnect, visit www.roofconnect.com.