Most roofers hear “10/50/50” and nod like they understand it. But behind the scenes? Half the industry is guessing. Some think it’s a magic formula. Others think it’s a sales gimmick. And plenty of new reps don’t learn what it really means until their paycheck comes in lighter than expected.
If you want to understand how a roofing commission structure actually works, especially this one, you need more than a definition. You need the math, the incentives, and the hidden trade offs owners never mention during onboarding.
Let’s break down the 10/50/50 model so you know exactly who gets what, when it pays out, and whether it’s a smart setup for your team or a slow leak in your margins.
The 10/50/50 Formula, Unpacked Without the Headache
The 10/50/50 roofing commission structure isn’t just a random pay formula. It’s a method built around balancing company risk with salesperson incentive, but it only makes sense once you see the math instead of the label. In this plan, part of the revenue is set aside for overhead, then remaining profit is shared half and half between the salesperson and the company.
Let’s strip away the confusion and walk through it like a roofer thinks.
Picture a $10,000 job. First, 10 percent is taken off the top for overhead, that’s money the company needs to cover office costs, admin, tools, insurance, and the everyday stuff that keeps lights on and phones ringing. After this cut, you’re left with $9,000.
Now it gets real clear:
- Materials and labor come off next, say that’s $5,400.
- That leaves $3,600 in net profit.
- Then that net gets split 50/50 between the rep and the company, $1,800 each.
This method is built to protect the business first (overhead gets paid), then reward performance once profit has been proven. That’s why you’ll often see it in scenarios where leads are abundant but margins are dynamic, like storm work or high-volume markets.
Why Companies Use This Split in the First Place
At first glance, the 10/50/50 structure looks generous, half the profit goes to the salesperson. But there’s intentional strategy behind it.
Roofing business owners like this split because:
- It makes reps think about profit, not just sales volume. If you sell a job that costs too much to build, there’s little to share. That naturally aligns priorities.
- It protects the company from paying big commissions on jobs that barely break even. The overhead slice means the business recoups basic costs before anyone gets paid.
- It avoids paying on gross revenue alone, which can reward reps even when the job loses money. Shared net profit keeps pay linked to true performance.
This split also sends a message to reps: you get paid when the business gets paid. That’s why owners like it for crews selling into storm markets, where jobs are large and margins can be predictable. But it can feel confusing if you’re new to commission math, especially compared to flat gross percentage models.
The “Looks Simple” Problems Nobody Warns New Reps About
The 10/50/50 roofing commission structure has a clean pitch. Ten percent overhead. Deduct labor and materials. Split the profit. Simple. But the simplicity is exactly what blinds new reps. The model hides variables that shift under your feet, margin swings, production delays, supplement battles, and cost spikes. Those shifts decide your paycheck more than the contract total ever will.
The first trap? Thinking big jobs equal big payouts. They don’t.
If labor comes in high or shingles jump in price, the “profit” you thought you were splitting gets eaten alive. This is why roofers should prioritize gross profit, not contract size. A $20,000 job with weak margins can pay less than a $10,000 job built tight and clean.
Another issue: transparency. New reps rarely see full job-cost breakdowns. When they don’t know how much labor, materials, overhead fees, and supplements change the math, every commission check feels like a surprise. Confusion turns into mistrust fast.
Storm restoration markets make the 10/50/50 model look appealing because volume is high and margins are predictable.
But retail? Retail bleeds under this model.
Here’s the pattern owners see over and over:
- Storm restoration: 10/50/50 works because jobs are similar and pricing follows insurance scopes
- Retail roofing: 10/50/50 often hemorrhages cash, paying reps far less than gross-percentage plans
That’s why many rookies actually perform better with simple gross-based plans.
Gross-based commission models under 12 percent are easier for new reps to understand and track, with many starting around 7 percent and scaling with performance milestones. It removes the mystery and keeps motivation consistent.
There’s also the pressure factor. Profit-based commissions put all the stress on the rep when production or paperwork slows down. Companies like Monarch Roofing experiment with employee models that offer base salary plus incentives, lowering that pressure and creating more stability, even though few in the industry adopt it.
The last major trap is job selection. Reps quickly avoid harder builds because the risk of low profit means low pay. It changes behavior in ways owners don’t always anticipate.
When 10/50/50 Roofing Commission Structure Works Beautifully… and When It Blows Up
The 10/50/50 roofing commission structure can feel like a well-oiled machine in the right environment. Same storms. Same scopes. Same production costs. Reps sell fast, jobs build fast, profits stay predictable. In those conditions, the split delivers clean motivation without the payroll bloat of salaried teams.
But move that same system into the wrong market? It detonates.
Here’s where it works beautifully:
- Storm restoration zones with steady claim volume
Jobs follow insurance scopes, so the math doesn’t swing wildly. Reps understand what they’re selling, owners know their margins, and everyone can forecast commissions.
- Teams with tight cost control
If you know your material prices, crew rates, and overhead to the penny, profit-based splits feel fair. Everyone is rowing in the same direction.
- High-producing reps who like performance pressure
Some reps thrive when their pay is tied to efficiency. They chase supplements, tighten job files, and naturally improve margins.
But here’s where 10/50/50 blows up:
The minute margins get unpredictable, this model goes from motivating to maddening. If your shingle prices swing, your crews fluctuate, or your overhead creeps up, reps feel like commissions shrink for reasons they can’t control. That lack of clarity kills trust.
And the pain points get obvious:
- Retail roofing markets
Retail requires discounts, financing promos, and competitive bids. Profit shrinks fast. Reps watch their paychecks dip and wonder why they even sold the job.
- Teams without accurate job costing
If you cannot show reps where money went, the plan feels rigged, even when it isn’t.
- Markets with high production variability
Tear-off surprises, decking issues, and multi-layer roofs eat entire commissions in one swoop.
- Owners who don’t know their overhead
If overhead isn’t tracked tightly, the model can drain more than it protects.
That’s why the real pros talk obsessively about one thing: the magic number for roofing business profit margins. If your margin consistently drops below the number your model requires to stay healthy, the plan turns into a slow leak in your business.
FAQs
What is the 10/50/50 roofing commission structure?
It’s a payout model where a salesperson earns 10 percent when the job is approved, 50 percent when production begins, and the final 50 percent once the job is paid in full.
Why do roofing companies use this structure?
It encourages sales reps to stay involved from start to finish. Each stage has a milestone payment, so everyone stays motivated to move the job forward.
Is the 10/50/50 model good for new reps?
It can be. New reps like seeing early money from the first 10 percent, but the later payouts require solid follow through, which can be a learning curve.
Do sales reps get paid faster with this structure?
They get a small payout early, but the bulk of their earnings come later. How fast they get paid depends on production schedules and how quickly the homeowner closes out payment.
Is the structure fair?
Many think it is because it ties pay to actual progress. Others feel the first payout is too small compared to the work done upfront.
Know the Numbers, Control the Game
The 10/50/50 roofing commission structure isn’t good or bad on its own. It’s a tool. It rewards clarity, punishes chaos, and exposes weak margins faster than any spreadsheet.
The roofers who win in 2026 are the ones who treat compensation like strategy, not tradition. They pick models that fit their market, their margins, and their sales team’s strengths. They stay transparent. They keep reps motivated. And they don’t let confusion drain energy from the field.
If you want to build a team that sells confidently, stays organized, and closes jobs with less back-and-forth, the right systems make everything smoother. Book a ProLine demo and see how a communication-first CRM helps roofing teams stay aligned, capture more leads, and produce jobs without the chaos.
