Many roofing contractors believe the answer to growth is simple: generate more leads.
According to Jon Broce, that’s usually not the real problem.
In this episode of the Roofing Success Podcast, Jon joins Jim Ahlin to discuss one of the biggest challenges facing roofing company owners today: understanding their numbers. From lead-to-set rates and profitability to cost of goods sold and forecasting future performance, Jon explains why data is the foundation of better decisions and sustainable growth.
Why Most Contractors Struggle to Implement Change
Jon spends a significant amount of time working with roofing contractors through coaching, training events, and industry education. One thing he consistently sees is that contractors leave events motivated and inspired, but their businesses often look exactly the same a few weeks or months later.
According to Jon, the problem isn’t a lack of desire.
The issue is implementation.
Many contractors know they need to improve, but they don’t know where to start. They don’t have the tools, systems, or visibility needed to identify the right priorities. That’s one of the reasons Jon and his team developed tools like the Growth Gauge, which helps identify blind spots and build a roadmap for improvement.
Revenue Doesn’t Tell the Whole Story
One of Jon’s strongest messages throughout the conversation is that contractors often focus on the wrong number.
Revenue.
He describes revenue as a vanity metric and argues that profitability provides a much clearer picture of business health. Rather than chasing bigger sales numbers, contractors should understand how much profit they’re actually generating.
Jon uses a simple example:
Would you rather run a $10 million roofing company operating at a 10% profit margin, or a $5 million company operating at a 20% margin?
In both scenarios, the profit is the same.
His point is that many contractors become focused on being the biggest company instead of building a healthier business.
“Revenue is a vanity stat. Let’s look at profit.”
The Five-by-Five Strategy
A major part of Jon’s coaching philosophy is what he calls the Five-by-Five strategy.
Rather than making massive changes all at once, he encourages contractors to focus on improving five key areas by just 5%.
The areas discussed in the episode include:
- Lead-to-set rate
- Appointment-to-close rate
- Cost of goods sold
- Average ticket value
- Bottom-line profit
The idea is simple. Small improvements across multiple areas can create significant results without requiring dramatic changes to the business.
As Jim points out during the discussion, incremental improvements often create larger long-term gains than trying to solve every problem at once.
The Most Overlooked Metric: Lead-to-Set Rate
When Jim asks which metric contractors ignore the most, Jon doesn’t hesitate.
Lead-to-set rate.
Many roofing companies lump leads and appointments together, treating them as the same thing. Jon argues that they’re not.
A company may be generating plenty of leads, but if those leads are not converting into appointments, the business has a process problem, not a lead problem.
This is where tracking becomes critical.
Contractors need to know:
- Which marketing channels are producing leads
- Which channels generate appointments
- Which channels ultimately produce sales
Without that information, it’s impossible to know where marketing dollars should be invested.
Understanding Cost of Goods Sold
Another area Jon sees contractors overlook is cost of goods sold (COGS).
Many roofing business owners immediately think about negotiating lower material prices or pushing crews harder when they hear discussions about reducing costs.
Jon approaches it differently.
He believes many companies can improve profitability by becoming more efficient. One example he shares is placing a supervisor on every job site. While some owners see this as an added expense, Jon found it actually reduced waste and improved material management.
By tracking returns, monitoring leftover materials, and creating accountability, his company reduced unnecessary material usage and improved profitability.
His broader point is that some expenses create a return that outweighs their cost.
Private Equity and the Importance of Data
The conversation also turns to private equity and its growing influence within the roofing industry.
Jon believes one of the biggest advantages private equity-backed companies have is their understanding of numbers.
They know their metrics.
They know their costs.
They know where to invest resources.
For independent roofing contractors, Jon believes understanding financial data is becoming increasingly important. Owners don’t necessarily need accounting degrees, but they do need enough knowledge to understand what the numbers are telling them.
“You can’t make any good decisions unless you’ve got the right data.”
Throughout the episode, Jon repeatedly returns to this idea. Better data leads to better decisions.
Knowing More Than Revenue
Jon encourages roofing contractors to go deeper than simply tracking sales.
Some of the metrics discussed include:
- Installed revenue
- Accounts receivable
- Work in progress (WIP)
- Cash flow timing
- Monthly business trends
- Profitability
Understanding these metrics helps owners forecast future performance and avoid making decisions based solely on current cash balances.
Rather than looking at one strong month and assuming the future will look the same, Jon believes contractors should study historical trends and use that information to make more informed decisions.
Why Historical Data Matters
One of the practical strategies Jon discusses is looking back several years when evaluating company performance.
Instead of focusing only on current results, he recommends analyzing historical revenue patterns to better understand seasonality and predict future performance.
This helps contractors establish realistic expectations for each month and avoid overreacting when revenue fluctuates.
By understanding long-term trends, business owners can make decisions with more confidence and less emotion.
Building Accountability Into the Process
Even when contractors know what needs to be done, implementation remains difficult.
Jon explains that accountability is one of the biggest reasons coaching groups and boardroom-style meetings work.
When owners regularly review numbers with peers and discuss results, they are more likely to follow through on the actions required to improve performance.
That accountability helps turn ideas into action.
And according to Jon, action is what ultimately creates growth.
Final Thoughts
Throughout the episode, Jon Broce delivers a consistent message: know your numbers.
Whether you’re evaluating marketing performance, hiring decisions, profitability, or growth opportunities, the quality of your decisions depends on the quality of your data.
Many roofing contractors spend years chasing more leads, more revenue, and faster growth. Jon argues that the better approach is understanding the business you already have, identifying the right metrics, and making steady improvements over time.
For roofing companies looking to grow intelligently, it starts with the numbers.
