February 2, 2024
9 min read

Your Roofing Company is Doomed if You Answer this Question Wrong

Matt Fruge
Founder and CEO

Our founder, Matt Fruge, asked a group of 100 roofers ``what is the most important financial metric that you can track in your company?" and the response he got was very alarming.

He discovered that many roofers only consider the net & gross profit margin, rather than focusing on the most important metric: cash flow.

This was so alarming to Matt because he has seen contractors make this mistake time and time again: the number one cause of business death in contracting (especially insurance restoration contractors!) is improper cash flow management.

Building the Foundation of Your Company

Consider this: If you were a first-time homeowner building your house, and your builder asks, "What is important to you about this house?" Are you just going to consider the square footage?


While the size of your house is important, so is the plumber, the foundation, and the other systems that make the house what it is, like the electrical – if your home's electrical work is done wrong, it will burn down!.

Think of your cash flow as the electricity running through your house. It's super important, especially for insurance restoration. Whether you're a roofer or restoration contractor, cash flow should be the number one focus inside your business. As much as you want to focus on profitability, it will never come if your company's cash flow isn't coming in on a regular basis.

Understanding The Time Value of Money

What is the time value of money? It is the concept that money is worth more now than in the future because you can use money to make more money. Your operating cash flow can be used to buy more equipment, hire more people, pay expenses, make dividend payments, prevent discretionary spending, and expand your service lines.

By reinvesting that money into your business, you can more rapidly increase your growth, rather than letting the bills that will inevitably pile up eat away at any cash reserves you may have. . Profitability is always important, but worrying about putting money in your pocket when there's no money coming in will never help you grow your business – your financial statements don't matter if you're going out of business.

In the contracting industry, focusing solely on profit will never set you up for a successful and positive cash flow because consistent income is not possible. Cash flow is the key to staying in business, and if you ignore this in favor of other less important aspects of your company, you run the risk of going out of business within the first two years, like 94% of other contracting businesses.

Setting Yourself Up for Success

If you are not setting yourself up with systems and processes to ensure that the inflows and outflows of cash in your business are balanced in a way that sets you up for growth, you'll stunt your own successes and never grow at the rate you are aiming for.

Our team at Squaredash talks to contractors just like you every day, and you'd be shocked at the lack of concern about negative cash flow. Just because working with a negative cash flow statement is commonplace doesn't mean you need to repeat the same mistakes contractors before you have made. It's time to escape that mindset and start getting your money faster.

While retail models that help get customers approved for loans and financing have become an option to put in your toolbox, there are still so many factors that need to coincide to get that customer approved – it's not as easy as your lending partner might make it out to be and won't be the answer to all your problems.

That's where Squaredash comes in.

When Matt realized there was no option for roofers to easily improve their free cash flow, he founded SquareDash. SquareDash was built to help you figure out how much cash you can get in the door as quickly as possible in a few simple steps.

Why Choose SquareDash?

If you’re a contractor whose work is frequently paid through insurance claims, you work in a fundamentally broken system. You've got to cover the massive costs at the beginning of a job, but it often takes 60 days (or longer) to get paid. A roof replacement & its repairs aren't cheap – the cost is hard on any bank account, and you don't have the time to wait for insurance company payouts.

SquareDash allows contractors to streamline accounting and collection processes and create a predictable revenue timeline without playing the guessing game of when you’ll be paid on insurance claims.

How Does Squaredash Work?

SquareDash makes getting funding simple – no need for a personal loan. Once your homeowner has an approved insurance claim, you simply:

  1. Upload the scope of loss PDF from the insurance carrier
  2. Select the line items you’ll be completing
  3. Send the homeowner a link through which they can pay their deductible
  4. Once the deductible is paid, click “Get Paid,” you’ll receive the ACV up front and the depreciation as soon as the job is completed – no more waiting on insurance coverage checks.
  5. When the customer gets the check, they use the same payment links to pay you for the work, which automatically goes towards paying off the advances we gave you.

The Benefits of Using SquareDash

With SquareDash, contractors can:

  • Maintain reliable and predictable cash flow
  • Begin jobs sooner & complete installation in a more timely manner
  • Quickly grow their businesses
  • Stop traveling to pick up insurance checks
  • Stop taking out personal loans to make ends meet.
  • Pay for material and labor without relying on supplier credit lines
  • Pay sales reps on the completion day versus waiting for depreciation checks to arrive.
  • Save time by collecting payments online.
  • Increase job output with improved cash flow with a payment advance on ACV and depreciation checks for each job.

Built For Roofers, By Roofers: Contact SquareDash Today for More Operations Funding Information

SquareDash is built for contractors, by contractors. We are in this business with you and understand how difficult it can be to manage your accounts payable when your operating expenses diminish your cash reserves. You need more money to make ends meet.

Our number one goal is to help you focus your cash flow so that you can actually get to profitability. Regardless of your business's financing activities, remember that you will only see growth if you focus on your cash flow.

Contact the SquareDash Sales Team at 214-740-6148 to learn more about how SquareDash can revolutionize your cash flow and account management and propel your roofing business forward.

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