(1) Maintain Your Financial Information
Accurate and timely financial information is essential for every business owner and manager. Even if you run a business from your billfold, you always need to know your own financial facts. You can't delegate the task of understanding your cash flow needs. Even if you have a good banker and a great accountant, they can't tell you how to be successful. And they can't really let you know you're in trouble until after you're already in it. For example, you can go broke doing larger and larger jobs. A company might begin in carpet cleaning with most invoices under $500. Then it begins doing restoration and succeeds at jobs up to $2,000 or so. A few $10,000 projects come along. The subs and suppliers are paid off, but late. Then a $40,000 job is completed with no payment received before 90 days. The bank loses confidence and refuses more credit. This unpleasant scenario has even happened to companies that were around for years. Always be in control of your cash position.

(2) Keep Qualified Employees
Most restoration company owners agree that a second important key to success is personnel - their real business associates. It doesn't work to have an employee who thinks, "I'm merely a carpet cleaner. I just do restoration work. I'm only getting some money together until I go back to school (or into business for myself). I'm just working here until I get a real job." Employees with low commitment and high turn-over are not healthy for your company image, your liability, or your cash flow. Employees want more pay, of course. But they also improve because of a higher level of company culture - when they achieve higher professional standards, experience greater self-worth, and feel more sense of ownership in your company and in their own careers. Your company's success goes hand in hand with your employees' success.

(3) Continually Reinvest
Another principle of business is continual reinvestment. The larger the percentage of profits that go back into your company, the better its chance of success. Just as you must invest your own money to stay ahead of inflation, you also need to invest the company's funds back into itself to match the overall rate of business growth. The speed of change is greater today than it used to be. Product and service life cycles are quicker. Customers expect more. Competition is ever increasing. You cannot rest on your laurels. To keep up, reinvest in your company's assets by maintaining, replacing and enlarging your base of vehicles, equipment, inventory, and buildings. Reinvest in your people by training them in safety, craftsmanship, customer relationships, work habits, and the other things we all learned in grade school, supposedly.

(4) Mitigate Your Liability Exposure
Don't ignore the fact that a legal liability claim could put you out of the restoration business. How can a restoration company be proactive to avoid this? For one thing, focus on liability issues that are common in restoration, especially if you have not experienced them before. Use a hazard communications plan, as required by law if you have employees. It will cover equipment, chemicals, and the common hazards of restoration sites, and is meant to reduce the number and the severity of accidents to workers and occupants. If you are ever named in a lawsuit after an accident, you can improve your chances in court. Show that in your company history you have followed a consistent pattern of safety planning, not a pattern of negligence. Also, continually raise your awareness of the health risks from biological contamination—mold, mildew, and unsanitary flooding—and about how to mitigate them. Follow industry standards. Be prepared to turn down or even walk off jobs where you are not allowed to complete the work according to professional standards. There are many examples. Don't try to restore severely contaminated carpet, much less cushion. Make sure occupants follow safety precautions. Insist on complete drying, to prevent future biological or structural problems that could cause you liability in the future.

(5) Always Be Ethical
It is generally agreed that the expert on your restoration jobs is you. Therefore, you are expected to do the right thing. Be ethical. Let's say that Mrs. Jones or her adjuster don't want you to dry the walls, because of time and expense. You know those walls must be dried to avoid property and health hazards to occupants. It may seem convenient to curry the customer's or client's favor by not drying the walls, but your ethical action is to insist on doing it. On the other hand, if the walls don't need to be dried, don't dry the walls just because the money would be nice.

(6) Be Unique in Your Market
Don't let your business be the best-kept secret in the world. You want to be known throughout your market area. If people have a water damage problem, of course they will call your company.

To create this kind of image for your company, give yourself a unique marketing advantage. And be sure to offer something that really is unique. It can't be just that you have a bigger truck mount. Instead, be a little outrageous. Maybe you say, "If we don't dry it, we buy it." Maybe you guarantee 100 percent satisfaction when your competition isn't willing to go out on that particular limb. You could promise to delete any line item on your invoice, no questions asked, if the client is not satisfied with it and says so in writing. What if others in your area use unit costing, but you offer 100 percent time and materials billing with no charges for equipment? Would that be unique, and just outrageous enough to get people's attention? On the other hand, you might use 100 percent unit based pricing with a promise of no time and materials. If your competition is doing primarily commercial you could do only residential, or vice versa. If your competition is doing any job that comes along, you might be unique by specializing only in restorative drying. Maybe you'd advertise that every technician has completed three weeks of internal training before going on any job. However you position your company, make it stand out by offering a unique benefit to your clients.

(7) Develop Your Communications Skills
The job of a business owner or manager is largely to explain things to people. If you don't explain well, people don't do what you want. Thus, you explain to associates why you use specific procedures. You explain to your banker how you will use a loan or credit line. To clients you explain why things cost the money and time they do. And you constantly explain this fundamental fact to yourself—that you are going to survive and prosper in your business. How can you improve your abilities to explain? In every contact, practice the art of discussion. Listen to good communicators, and imitate them. Take classes and read books on written and verbal communications.

Conclusion
To survive in restoration, a business owner must apply sound business practices. Most of those suggested above apply to business in general. Some of the details are specific to restoration. Remember that we're all in the same boat - every one of us doing our best to continually improve our abilities in business.

Claude Blackburn has been involved in the cleaning and restoration industry since 1972. He is the founder and president of Dri-Eaz Products in Burlington, Washington. David Slabaugh is a writer-editor at Dri-Eaz.

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