Back to Blog
Exit Planning
Roofing Business Due Diligence: What Buyers Will Ask For
Exit Lab Research 2026-03-12 15 min
Due diligence is the process buyers use to verify everything you have told them about your roofing business. It is the most stressful part of any transaction, and poor preparation is the number one reason roofing deals fall apart. This article provides a comprehensive checklist of what buyers will examine.
Financial Due Diligence
- 3-5 years of tax returns (corporate and personal)
- Monthly P&L statements for the trailing 24 months
- Balance sheets and cash flow statements
- Accounts receivable aging report
- Accounts payable aging report
- Revenue by customer and project type
- Owner compensation and benefits detail
- All add-backs with supporting documentation
- Bank statements for all business accounts
- Credit card statements for business cards
- Equipment lease agreements and payment schedules
Operational Due Diligence
- Employee roster with tenure, role, and compensation
- Organizational chart
- Subcontractor agreements and 1099 documentation
- Vehicle and equipment inventory with condition assessment
- Technology systems inventory (CRM, accounting, project management)
- Standard operating procedures (SOPs) documentation
- Safety records and OSHA compliance history
- Manufacturer certifications and warranty documentation
- Insurance policies (general liability, workers comp, auto, umbrella)
- Pending or historical litigation
Customer and Revenue Due Diligence
- Top 20 customers by revenue with contract details
- Customer concentration analysis
- Maintenance contract portfolio with renewal rates
- Backlog report (contracted but not completed work)
- Marketing and lead generation sources
- Online reviews and reputation analysis
- Warranty claims history and resolution rates
Pro Tip
Start assembling your due diligence materials 6-12 months before going to market. Buyers who receive organized, complete information packages move faster and offer higher multiples because they perceive lower risk.
Common Deal Killers
- Undisclosed liabilities or pending lawsuits
- Significant discrepancies between tax returns and internal financials
- Key employee departures during the process
- Customer concentration above 20% with a single client
- Unresolved workers compensation claims
- Environmental issues or code violations
- Misclassified 1099 workers