As an entrepreneur, you’re probably researching many different types of businesses that have profit potential and align with your long-term goals. When studying the trends, you’ll recognize that the restoration industry is growing, now valued at $210 billion globally.
The growth is due to climate change sparking an increased number of natural disasters, coupled with aging structures in need of repair. Being a business owner in this sector means you’re providing a much-needed service in your community, helping commercial businesses and homeowners during a disaster. But before you begin your search for a restoration business for sale, there are other options to consider.
5 Things to Know Before You Buy
Whether you start a business from scratch, purchase an existing disaster restoration business for sale, or become a franchise owner, here’s some information and questions to ask to help you make an informed decision before you invest.
1. Financially, you want to find out the company's annual revenue and profit margin. This includes requesting financial statements for the past few years and finding out if there are any outstanding debts or liabilities. As a new business owner, you’ll need to discover what your major expenses and operating costs will be. This helps you evaluate affordability and long-term growth strategies.
2. Know your customers and the market. Find out who the company’s main clients are and their reputation in the overall industry and the community. Ask what the geographic reach of the company is and if they have any exclusive contracts or partnerships in place. In the restoration industry, owners may work closely with local police and fire stations, attorneys, insurance adjusters and real estate agents. Ask the current owner, how do you attract and retain a customer base? You’ll want to know if the company’s current data base of clients is included in the sale. You’ll also want to learn about the company’s reputation for customer satisfaction.
3. From an operational standpoint, find out what services are currently provided. The scope of work may be determined by the number of crews currently in place, the equipment, and certifications to do restoration work. Offerings may include services like water damage restoration, fire damage restoration, and mold remediation. Here are a few questions to ask to gain more information:
- What is the size and condition of the company's equipment and inventory?
- How many employees does the company have, and what are their roles?
- Are the employees certified and properly trained?
- Are there any licenses, certifications, or permits required to operate the business?
4. You’ll need to know about the business systems in place in case they need to be updated or you need to be trained to use them. Find out the type of software programs used for project management, scheduling, and billing. Ask about how the projects are managed and executed. Perhaps there are established relationships with suppliers or subcontractors that you can maintain as the new owner. Especially when looking at a franchise, ask if there are any proprietary methods or technologies used by the company.
5. There’s always insurance and legal matters that you need to know about, like general liability and workers' compensation. You’ll want to look into whether the company has been involved in any legal disputes, had insurance claims or safety violations, or has been involved in any pending or potential legal or regulatory issues.
Independent Ownership or Franchise Ownership?
If you’re looking at a restoration business, find out why it’s for sale. Be aware of red flags like recent loss of revenue. Find out the franchisor’s future plans and the brand’s growth potential. A good sign would be the existence of expansion opportunities with growth strategies in place.
Purchasing a restoration business for sale has its challenges. Although you may be taking over an established business, you’ll be an independent business owner, going it alone. You may find franchise ownership to be more advantageous than buying a stand-alone business because you enjoy the challenges of small business ownership with an army of support behind you.
Franchising with ServiceMaster Restore
Being part of an established brand recognized in the industry can provide you with a competitive edge by instilling trust and credibility among customers. As an owner, you gain from comprehensive training programs and ongoing support from the franchisor, including business operations, marketing strategies, and technical training on restoration techniques.
When you partner with ServiceMaster Restore, a leader in the restoration business , you benefit from ongoing assistance, such as access to industry best practices, marketing materials, and a network of fellow franchisees to share experiences and advice.
We’ve built a solid reputation with the high standards we’ve set for more than 65 years. Our customers trust us, and that benefits you as a franchise owner, helping your business grow. We are committed to your success.
Ready to hear more? Let’s get started . Simply fill out the form and we’ll be in touch.