Welcome to Ready
Complete Restoration Training Platform
Master the complete restoration lifecycleβfrom emergency mitigation through final reconstructionβwith dual certification paths aligned with IICRC standards and industry best practices.
What's Inside the Platform
Ready is designed to transform field technicians into IICRC-certified restoration professionals through structured, phase-based learning modules aligned with industry standards.
Readiness & Prep
Master vehicle maintenance protocols, equipment hygiene standards, and consumable inventory management for 24/7 rapid response capability.
- β Rapid Response Checklists
- β Vehicle Maintenance Protocol
- β Equipment & Sensor Hygiene
- β Consumables Inventory System
Mitigation Workflow
Learn the complete technical lifecycle from customer onboarding through dry-out completion, including critical safety protocols per IICRC S500.
- β 7-Step Project Lifecycle SOP
- β Asbestos Investigation Protocol
- β Water Categories & Classes
- β Moisture Mapping Standards
Contents & Logistics
Precise handling of personal property from Encircle initialization through safe transport and clean materials exchange.
- β Encircle Project Setup
- β Trailer Safety & Loading
- β Inventory Control Standards
- β Textile Processing Protocol
Ready Team Exclusive Training
Advanced modules for Ready Team subscribers covering reconstruction operations and business financial management.
Reconstruction Operations
Master the complete reconstruction lifecycle from estimating and scope negotiation through construction sequencing and final closeout.
- β Transition & Handoff Protocols
- β Xactimate & Estimating Software
- β Pre-Construction Planning & Permits
- β Construction Sequencing & QC
- β Project Completion & Closeout
Financial Operations
Master job costing, profitability analysis, pricing strategy, cash flow management, and tax considerations for sustainable business growth.
- β Understanding Business Profitability
- β Margins & Markups (50%+ Standards)
- β Break-Even Analysis & Cash Flow
- β Pricing Strategy & Value Communication
- β Tax Considerations & Compliance
Dual Certification Pathways
Ready offers two complete certification programs. Each follows a practice-then-certify structure with 80% pass requirement and downloadable PDF certificates.
Mitigation Certification
Master emergency response, water/fire mitigation, and contents handling per IICRC S500 standards.
β Vehicle & Equipment Readiness
β Mitigation Workflow (7-Step Lifecycle)
β Contents & Logistics Management
Earn: Ready Certified Technician
Reconstruction Certification
Master estimating, scope negotiation, construction sequencing, and project closeout for insurance repairs.
β Xactimate & Estimating Software
β Construction Sequencing & Quality Control
β Pre-Construction Planning & Closeout
Earn: Ready Certified Contractor
Both certifications available to Ready members
Ready Pro Coaching Modules
Advanced leadership and business strategy training for restoration business owners ready to scale and optimize their operations. Available with Ready Pro Coaching membership.
Team Scaling & Leadership
Build high-performing teams with hiring frameworks, training systems, performance management, and organizational structure design.
Exit Strategy & Sale Prep
Position your company for maximum valuation with buyer preparation, financial optimization, due diligence readiness, and transition planning.
How the Platform Works
Learn
Study each operational phase with interactive SOPs and real-world protocols
Explore
Click "More" buttons to reveal the "Why" behind every expectation
Practice
Take practice quizzes to test knowledge and identify areas for review
Certify
Pass certification exam and download your Ready Certified Technician certificate
Phase 1: Readiness & Prep
Fleet maintenance, equipment hygiene, and consumable inventory to ensure 24/7 rapid response capability per IICRC standards and OSHA safety requirements.
Industry Context: The restoration industry operates on immediate-response timelines. According to IICRC S500 standards, water damage mitigation should begin within 24-48 hours to prevent Category 1 (clean water) from degrading into Category 2 (grey water) or Category 3 (black water). Equipment readiness is not optionalβit's the foundation of professional restoration services and directly impacts customer outcomes, insurance adjuster relationships, and your company's liability exposure.
π Rapid Response Status
Expectation:
Vehicles must be mission-ready before every shift. This includes minimum 1/2 tank fuel, backed-in parking for immediate deployment, security locking, and complete equipment stocking per PAR (Periodic Automatic Replenishment) list posted in van.
The "Why" - Response Time Economics:
The average restoration response generates $2,000-$8,000 in initial billing. Every 30-minute delay costs the company potential revenue and damages customer trust. A van needing fuel or missing critical equipment (fans, dehumidifiers, moisture meters) creates a 20-45 minute delay on arrival time. During that delay, water continues migrating through building materialsβdrywall wicks moisture upward at approximately 1 inch per hour, subfloor saturation spreads laterally, and microbial growth risk increases exponentially after 24-48 hours.
Insurance Industry Standards:
Third-Party Administrators (TPAs) and insurance companies track response times. Consistent delays result in removal from preferred vendor lists. The industry standard is 1-hour response time for emergency water mitigation. Fuel stops, equipment runs to shop, or improper van stocking directly threaten this metric.
Liability Protection:
Backed-in parking ensures technicians can load/unload equipment safely without backing into traffic or property. Security locks prevent equipment theft (average loss: $15,000-$35,000 per incident) and protect company assets. Complete stocking prevents improvised solutions that violate IICRC protocols and create liability exposure.
π§ Vehicle Maintenance Protocol
Expectation:
Bi-weekly inspection of tires (PSI and tread depth), lights (headlights, brake lights, indicators), and fluids (oil, coolant, brake fluid, windshield washer) via digital Job-Dox form. Any deficiency must be reported to Supervisor immediatelyβvehicle is grounded until resolved.
The "Why" - Safety & Asset Protection:
Catastrophic Prevention: Restoration vans carry 2,000-5,000 lbs of equipment (fans, dehumidifiers, generators, air scrubbers, tools, consumables). Under-inflated tires combined with heavy loads cause blowouts at highway speeds. Tire blowout incidents result in vehicle rollover, technician injury/death, and equipment loss averaging $45,000-$150,000 per incident.
Operational Continuity: Engine failure from low oil or coolant creates 2-5 day downtime. During peak storm season, this removes a van from active deployment when demand is 300-500% above baseline. One grounded vehicle can cost $20,000-$50,000 in lost opportunity revenue during CAT (catastrophic loss) events.
OSHA Compliance: Federal law requires employers to maintain vehicles in safe operating condition. Brake failure, lighting defects, or tire issues that cause accidents trigger OSHA investigations. Penalties range from $7,000-$70,000 per violation, plus civil liability for injuries.
Documented Inspection = Liability Shield:
Digital Job-Dox forms create timestamped records proving systematic maintenance. In litigation, documented inspections demonstrate "reasonable care" and defeat negligence claims. Missing documentation shifts liability burden to company, with potential multi-million dollar exposure in injury/death cases.
Tires & Pressure: Visually inspect tread (minimum 4/32") and verify PSI matches door placard specs. Under-inflation by 10 PSI increases tire heat by 20Β°F.
Lights & Wipers: Test all lighting systems (headlights, brake lights, indicators, hazards). Verify wiper blade conditionβstreaking indicates replacement needed.
Oil & Fluids: Check oil level and color (black oil indicates breakdown). Monitor coolant level and verify no leaks. Track oil change intervals per manufacturer spec.
Digital Inspection Form: Complete form in Job-Dox > Documents list every other week. Timestamped submission required for compliance.
Equipment & Sensor Hygiene
Expectation:
All air movers, dehumidifiers, and air scrubbers must be cleaned BEFORE entering customer property. All moisture meters, thermal cameras, and hygrometers must be calibrated, functional, and have fully charged batteries. Extra meter pins and batteries stocked in van at all times.
The "Why" - Professional Standards & Data Integrity:
Indoor Air Quality (IAQ) Concerns: Fans and dehumidifiers that aren't cleaned carry dust, pollen, mold spores, and construction debris from previous jobs. When deployed in a customer's home, these particles become airborne and circulate throughout the property. This triggers allergic reactions, respiratory complaints, and creates secondary contaminationβturning a water loss into an indoor air quality incident. Insurance adjusters classify this as "aggravated damage" which can void coverage and create massive liability exposure.
Cross-Contamination Protocol: IICRC S500 Section 10.2.1 requires that equipment used in Category 2 or Category 3 water losses (grey water/black water) must be thoroughly decontaminated before use on Category 1 (clean water) losses. Failure to decontaminate equipment transports bacteria, viruses, and pathogens between job sitesβcreating disease transmission pathways and massive liability. Equipment contamination incidents have resulted in six-figure settlements and loss of IICRC Certified Firm status.
Sensor Calibration = Accurate Drying Decisions: Moisture meters drift Β±2-5% over time. An uncalibrated meter reading 14% might actually be 18%βwhich is above the 16% "affected material" threshold per IICRC standards. This leads to premature equipment removal, incomplete drying, and secondary mold growth (typically discovered 30-90 days post-mitigation). Mold remediation costs $5,000-$50,000 and often triggers "negligent restoration" litigation.
Thermal Imaging Accuracy: Thermal cameras map temperature differentials that indicate moisture intrusion behind walls and ceilings (wet materials are cooler due to evaporative cooling). Uncalibrated cameras miss moisture pockets, leading to hidden water damage that causes structural rot, mold growth, and insurance claim disputes. Thermal cameras must be calibrated quarterly per manufacturer specifications.
Equipment Hygiene = Customer Trust:
Customers judge restoration companies within 60 seconds of equipment arrival. Dirty, dusty fans communicate unprofessionalism and create immediate trust deficits. Clean, well-maintained equipment demonstrates competence and establishes customer confidenceβdirectly impacting online reviews, referrals, and repeat business opportunities.
Meters, Sensors & Cameras
- β’ Moisture meters calibrated Β±2% accuracy
- β’ Hygrometers verify RH% readings
- β’ Thermal Cameras charged & calibrated quarterly
- β’ Extra pins & batteries (AAA, AA, 9V) stocked
Fans & Dehumidifiers
- β’ Cleaned after EVERY job completion
- β’ Air filters replaced per manufacturer spec
- β’ Malfunctioning units tagged "REPAIR"
- β’ Removed from active inventory immediately
Consumables Inventory
Expectation:
Inventory must be checked against the PAR (Periodic Automatic Replenishment) list every morning before shift start. No technician leaves the shop without standard stock levels. PAR list posted inside rear van door for reference.
The "Why" - Operational Flow & Billing Efficiency:
Mid-Job Supply Runs Kill Profitability: Running out of containment poly, trash bags, antimicrobial spray, or painter's tape mid-job forces a technician to leave for a hardware store. This creates a 45-90 minute gap where labor is non-billable but still incurs cost. On a $150/hour labor rate, this represents $112-$225 in lost billing plus increased total job duration.
Customer Perception Impact: Technicians leaving to "get supplies" communicates poor preparation and reduces customer confidence. This directly impacts online reviews and word-of-mouth referralsβthe two primary lead sources for restoration companies.
Insurance Documentation Requirements: IICRC S500 mandates comprehensive photo documentation (4-corner photography, moisture mapping, affected materials). Missing supplies like batteries, memory cards, or documentation tags delays proper documentationβwhich insurance adjusters use to approve or deny line items on estimates. Incomplete documentation results in 20-40% claim reduction on average.
Standard PAR Levels:
PAR levels are calculated based on average daily consumption across all active jobs. Minimum stock levels ensure 2-3 day supply without restocking. Critical items (N95 masks, gloves, shoe covers) have higher PAR levels due to OSHA and safety requirements.
Phase 2: Mitigation Workflow
The complete technical lifecycle from customer onboarding through dry-out completion per IICRC S500 standards.
IICRC S500 Foundation: The ANSI/IICRC S500 Standard for Professional Water Damage Restoration is the industry's procedural standard, developed through peer review and ANSI accreditation. It describes mandatory procedures for water damage restoration in residential, commercial, and institutional buildings. Following S500 protocols is not optionalβit's the standard of care used by insurance companies, TPAs, attorneys, and regulators to evaluate restoration work. Deviation from S500 creates liability exposure and can result in claim denial, litigation, and loss of insurance work authorization.
π Critical: Asbestos Investigation
Expectation:
Immediately identify red-flag materials: popcorn ceiling texture, 9x9 floor tiles, pipe wrap insulation, mastic adhesives (black tar), textured coatings. Properties built before 1985 have 80-90% probability of containing asbestos. STOP WORK immediately if suspectedβdo not drill, saw, disturb, or manipulate suspected materials.
The "Why" - Health Hazard & Regulatory Compliance:
Asbestos is a Proven Carcinogen: EPA classifies asbestos as a Class A carcinogen. Inhalation causes mesothelioma (fatal lung cancer), asbestosis (scarring of lung tissue), and lung cancer. Symptoms appear 10-40 years post-exposureβthere is no safe exposure level. Disturbing asbestos materials releases microscopic fibers (1/100th diameter of human hair) that remain airborne for days and penetrate deep into lungs.
Federal & State Enforcement: EPA NESHAP (National Emission Standards for Hazardous Air Pollutants) regulations mandate asbestos testing before demolition or renovation. OSHA requires exposure monitoring and respirator programs if asbestos is disturbed. Violations result in citations of $7,000-$70,000 per incident. Willful violations (knowing endangerment) carry criminal penalties including imprisonment.
Civil Liability Exposure: Asbestos exposure lawsuits result in multi-million dollar verdicts. Average asbestos mesothelioma settlement: $1-2.4 million. If restoration company disturbs asbestos without proper protocol, the company becomes liable for all downstream health effectsβincluding cancer diagnosis 20+ years later.
Protocol When Suspected:
1. STOP WORK immediatelyβsecure area and prevent access
2. Notify supervisor and property owner of suspected ACM (Asbestos-Containing Material)
3. Schedule EPA-certified asbestos inspector for sampling and lab analysis
4. If positive: Engage licensed asbestos abatement contractor before resuming restoration
5. Document entire processβstop work notification, testing, abatement clearance
STOP WORK IMMEDIATELY if asbestos is suspected on commercial properties or pre-1985 residential jobs.
π§ IICRC Water Categories & Classes
Water Categories (Contamination Level)
Category 1: Clean Water
From sanitary source (supply lines, sink overflows). No substantial risk from contact. Salvageable with proper drying. Degrades to Cat 2 after 48 hours.
Category 2: Grey Water
Significantly contaminated (dishwashers, washing machines, toilet overflow with urine). Potential for sickness if contacted. Requires antimicrobial treatment. Degrades to Cat 3 after 48 hours.
Category 3: Black Water
Grossly contaminated (sewage, rising flood water, toilet bowl with feces). Contains pathogens and toxins. All porous materials must be removed and discarded. Full PPE required.
Water Classes (Evaporation Rate)
Class 1: Minimal Absorption
Affects only part of room. Low-porosity materials (concrete, tile). Fastest dry time: 1-2 days typical.
Class 2: Significant Absorption
Entire room affected. Carpet, cushion, drywall wicking <24". Moderate dry time: 3-5 days typical.
Class 3: Maximum Absorption
Water from overhead. Walls, ceilings, insulation saturated. Wicking >24". Extended dry time: 5-10+ days.
Class 4: Specialty Drying
Bound water in low-porosity materials (hardwood, plaster, concrete). Requires specialty equipment. Longest dry time: 10-21+ days.
7-Step Project Lifecycle SOP
Expectation:
Every water damage project follows this exact sequence. Skipping steps, reversing order, or taking shortcuts violates IICRC S500 and creates liability. Work Auth must be signed BEFORE starting any physical work. Documentation at each phase is mandatoryβwithout it, insurance will not pay.
The "Why" - Procedural Consistency & Insurance Approval:
Work Authorization = Legal Protection: Work Auth is a contract authorizing the restoration company to perform services. Without signed Work Auth, you are trespassing and have no legal right to be on property or perform services. If the homeowner later disputes charges or claims unauthorized work, the company has zero legal standing without signed Work Auth. This results in complete write-off of labor and materialsβ$3,000-$15,000 average loss per incident.
Documentation Drives Payment: Insurance adjusters approve or deny line items based on photo documentation, moisture readings, and equipment logs. IICRC S500 requires "comprehensive documentation throughout the restoration process." Missing documentation = denied line items. Industry data shows that poor documentation results in 30-45% reduction in total claim payout.
Timely Demo Prevents Secondary Damage: Wet drywall, insulation, and framing lumber must be removed within 48-72 hours to prevent mold colonization. Delayed demo extends drying time by 3-7 days and increases mold risk exponentially. Mold growth discovered post-restoration triggers insurance investigations, potential claim denial, and litigation alleging negligent restoration practices.
Equipment Placement Based on Psychrometry: IICRC S500 Section 13 defines equipment selection and placement methodology. Air movers must create "laminar airflow" across wet surfaces. Dehumidifiers must be sized for cubic footage and moisture load. Improper equipment placement extends dry time, wastes equipment rental costs, and fails to achieve proper dryingβleading to material deterioration and secondary damage.
Completion = Certificate of Completion (COC):
Final COC documents that all materials have achieved IICRC S500 drying goals (typically β€15% moisture content for wood framing, β€16% for drywall). COC protects the company by establishing that work was completed per industry standards and releases the company from future liability for moisture-related issues. Without COC, the company remains liable indefinitely for any moisture-related problems.
Arrival & Onboarding
Work Auth signed BEFORE any services begin. Verify customer identity and property ownership.
Investigation & Documentation
4-corner photos, thermal imaging, moisture mapping, affected materials inventory. Complete ES checklist in Job-Dox.
Ancillary Services & Demolition
Water extraction, controlled demo of affected materials. Timely removal within 48-72 hours prevents mold.
Equipment Set
Air movers, dehumidifiers, air scrubbers placed per psychrometric calculations and system recommendations.
Daily Monitoring
Log readings daily. Update moisture map. Upload notes to Job-Dox within 15 minutes of leaving site.
Labor & Scope Capture
Enter all line items in Job-Dox. Complete Docusketch floor plan with measurements.
Completion & COC
Remove all equipment. Final moisture readings β€15%. Issue Certificate of Completion with photos.
Vertical Elevation Rule
Expectation:
Take moisture readings at floor level, 24" elevation, 36" elevation, and 48" elevation. The 16% threshold determines "affected" vs "unaffected" materials per IICRC S500. Any reading β₯60% is logged as exactly "60%"βdo not log higher percentages.
The "Why" - Standard Data Collection & Insurance Approval:
16% Threshold = Industry Standard: IICRC S500 establishes 16% as the affected material threshold for wood and drywall. Below 16% = dry/normal conditions. Above 16% = affected material requiring drying or removal. This threshold is based on decades of research on microbial growth conditions. Materials consistently above 16% moisture content support mold colonization within 48-72 hours.
60% Cap = Data Standardization: Moisture meters max out at 99%, but readings above 60% indicate complete saturationβthe meter cannot differentiate between 65%, 85%, or 99% because the material is fully saturated. Logging "60%" creates uniform data across the restoration industry and prevents meter reading errors from inflating scope.
Vertical Mapping = Demo Height Determination: Water wicks upward through drywall and framing via capillary action at approximately 1" per hour. The vertical moisture map documents wicking height and determines demo line. Insurance adjusters use these readings to approve vertical demoβif readings show 18% at 24" elevation but 12% at 36" elevation, approved demo is cut at 2 feet. Missing vertical readings result in denied demo claims and reduced payment.
Documentation = Legal Protection:
Moisture maps must be updated daily and uploaded to Job-Dox within 15 minutes of leaving site. These readings establish drying trend dataβshowing material moisture decreasing over time. If litigation occurs alleging incomplete drying or negligent restoration, moisture maps are the primary evidence demonstrating proper drying protocol was followed. Missing or incomplete moisture documentation has resulted in six-figure adverse judgments against restoration companies.
πΈ 4-Corner Photography
Expectation:
Stand in each corner of every affected room and shoot diagonally across to the opposite corner. This creates overlapping fields of view that capture 100% of room contents, wall surfaces, floor conditions, and ceiling damage. Take photos BEFORE moving anything.
The "Why" - Visual Documentation = Payment Approval:
Insurance Companies Only Pay What's Proven: Adjusters review photo documentation to verify affected materials and approve line items. IICRC S500 Section 8.5 requires "comprehensive photo documentation before, during, and after restoration." Missing photos = denied line items. Industry average: incomplete photo documentation results in 25-35% claim reduction.
4-Corner Method Prevents Blind Spots: Single-angle photos miss corners, hidden areas, and true extent of damage. Four diagonal shots create overlapping coverage with zero blind spots. If later dispute arises about scope of demo or affected area, 4-corner photos provide irrefutable visual evidence of pre-loss conditions.
Timestamp = Litigation Defense: Digital photos embed EXIF data (date, time, GPS). If homeowner later claims restoration company damaged property that was actually pre-existing, timestamped photos prove condition upon arrival. This has prevented false damage claims averaging $8,000-$25,000 per incident.
Additional Documentation Requirements:
β’ Close-ups of affected materials (wet drywall, saturated carpet, water stains)
β’ Thermal imaging showing moisture intrusion pathways
β’ Equipment placement and positioning
β’ Final completion photos showing dry conditions
Diagonal shots from each corner ensure 100% room coverage with zero blind spots
Phase 3: Contents & Logistics
Precise handling of personal property from initial sync to safe transport per IICRC S800 standards.
Contents Restoration Standards: IICRC S800 (Standard for Professional Contents Restoration) governs the handling, inventory, cleaning, and return of personal property. Contents claims represent 40-60% of total water damage loss value. Proper contents handling protects high-value items, reduces claim disputes, and differentiates professional restoration companies from competitors. Poor contents management results in loss/damage claims averaging $15,000-$50,000 per incident.
Encircle Project Initialization
Expectation:
Ensure Job-Dox work types ("Contents Clean" or "Contents Pack") are toggled BEFORE leaving the job site. This triggers automatic Encircle project creation. Technicians must then manually add each room structure in Encircle and photograph ALL contents in original location before touching.
The "Why":
Digital accountability prevents lost paperwork and ensures Contents team has immediate access to field inventory data. In-place photos establish condition and location, protecting company from false damage claims. Average contents inventory contains 500-2,000 items worth $50,000-$250,000 total valueβproper documentation is essential liability protection.
Job-Dox Sync Protocol:
Projects generate automatically in Encircle once Contents Clean or Contents Pack is enabled in Job-Dox work types.
Room Setup Rule:
Technicians must manually add each room in Encircle. Each room requires in-place photos of ALL contents before packing or moving anything.
Trailer Safety & Loading
Expectation:
Follow loading hierarchy: Heavy base (appliances, furniture), uniform boxes middle, light/fragile top. Blanket and shrink-wrap all unboxed items to prevent "rub damage" during transport.
The "Why":
Professional loading prevents transport damage and ensures trailer stability. Heavy base lowers center of gravity preventing rollover. Rub damage (scratches, dents, finish damage) results in replacement costs averaging $500-$3,000 per item and damages customer trust. Proper loading demonstrates professional contents handling standards.
Clean Materials Exchange
On Fire or Mold projects, exchange original packing materials for clean ones once contents are processed at facility. Original materials absorb soot and mold sporesβreturning items in contaminated boxes creates health risks and insurance rejections.
π¦ Inventory Control
Document everything in-place with photos. Log Make/Model/Serial# for electronics and appliances. Use Encircle 'box' field for unique numbering.
Reconstruction Operations
Master the complete rebuild lifecycle from post-mitigation handoff through final closeout, including estimating software, scope negotiation, payment draws, construction sequencing, and quality control.
Industry Foundation: Xactimate & Symbility
Xactimate controls 80%+ of insurance claim pricing in North America. It's the industry-standard estimating platform that insurance adjusters and restoration contractors use to create, negotiate, and approve repair scopes. Understanding how to properly code line items, apply regional pricing adjustments, and document scope changes determines project profitability.
Symbility is the secondary platform used by several major carriers. Both systems operate on similar principles: regional pricing databases, standardized line-item coding, and digital scope exchange (ESX format for Xactimate). Ready Companies contractors must be proficient in both platforms to serve all insurance partners effectively.
Transition from Mitigation to Reconstruction
Expectation:
Before accepting a reconstruction project, verify mitigation completion, confirm source repair, obtain complete documentation from the mitigation team, and assess structural integrity. The Work Authorization must be signed before any reconstruction activities begin.
The "Why" - Critical Transition Point:
The handoff between mitigation and reconstruction is where most project delays and cost overruns occur. Insurance companies track this transition closelyβdelays of 7+ days between mitigation completion and reconstruction start trigger adjuster scrutiny and can result in claim complications. Proper handoff prevents costly rework, ensures building code compliance, and protects Ready Companies from liability exposure.
Documentation Requirements:
- Complete moisture readings showing dry-down completion
- Photographic documentation of all affected areas
- Equipment logs detailing placement and removal dates
- Scope of mitigation services performed
- Areas of concern or hidden damage discovered
Structural Integrity Assessment:
After major fire or water damage, Ready Companies reconstruction team conducts a structural safety evaluation. This includes checking load-bearing walls, floor joists, roof trusses, and foundation integrity. Structural compromises must be identified and scoped before proceeding with cosmetic repairs.
β Handoff Checklist
- β’ Mitigation completion verified
- β’ Source of loss repaired
- β’ Documentation complete
- β’ Structural assessment done
- β’ Work Authorization signed
β οΈ Common Transition Failures
- β’ Starting before mitigation complete
- β’ Missing structural assessment
- β’ Incomplete documentation
- β’ No Work Authorization
- β’ Source not fully repaired
Estimating & Scope Agreement
Expectation:
Complete a comprehensive site assessment documenting all repairs needed. Create the initial estimate in Xactimate or Symbility using industry-standard pricing. Request the insurance carrier's scope in ESX format (if they provide one). Negotiate scope differences through 2-3 typical revision cycles with line notes explaining all additions. Secure written approval for customer upgrades. DO NOT begin any work until the first draw payment is received and posted.
The "Why" - Profitability Foundation:
Xactimate pricing controls project profitability. Understanding how to code line items correctly, apply regional modifiers, and document non-standard conditions is the difference between profit and loss. Average reconstruction projects require 2-3 scope revisions before approvalβrushing this process results in incomplete estimates requiring expensive supplements that delay payment and erode margins. Every line item not in the scope is work performed for free.
Scope Development Workflow:
- Site Visit: Document all damage with photos. Assess structural, electrical, plumbing, HVAC, and finish repairs needed. Note building code upgrade requirements.
- Request Carrier Scope: Ask adjuster for their scope in ESX format. This allows direct import into Xactimate for comparison.
- Create or Duplicate Scope: If carrier provides scope, duplicate it. If not, create initial scope from site assessment.
- Revise with Line Notes: Add all missing items with detailed line notes explaining why each is necessary. Include material costs, labor requirements, and code compliance needs.
- Negotiate: Discuss scope with adjuster. Be prepared to provide photos, code references, and material spec sheets. Typical 2-3 revision cycles.
- Customer Extras: Once insurance scope is agreed, meet with customer to discuss upgrades (better finishes, layout changes, etc.).
- Written Approval: Get customer approval in writing for all extras and pricing.
- Load to Budget: Import final scope to project budget and request first draw payment.
Critical Rule - Never Start Without Payment:
Ready Companies does NOT perform any reconstruction work or incur any costs before the first draw payment is received and posted. Starting work without payment creates 100% financial risk. Wait for admin confirmation that payment has cleared before ordering materials or scheduling vendors.
π― Xactimate Proficiency Requirements
Line Item Coding
Master correct codes for demolition, framing, drywall, electrical, plumbing, HVAC, flooring, paint, and trim.
Regional Pricing
Understand local pricing databases and when to apply RCV (Replacement Cost Value) adjustments.
Documentation
Use line notes, photos, and sketches to justify non-standard pricing or scope items.
Pre-Construction Planning
Expectation:
Secure all required building permits before starting work. Coordinate with admin to request first draw payment (typically 30-50% of total project cost). If mortgage company is involved, understand their inspection and release requirements. Establish site logistics including material storage, dumpster placement, and temporary power. Schedule all subcontractors and verify current insurance certificates.
The "Why" - Risk Mitigation:
Building permits aren't optionalβthey're legal requirements. Construction without permits results in stop-work orders, failed inspections when discovered, and potential legal liability. Many municipalities require permits for anything beyond cosmetic repairs. The AHJ (Authority Having Jurisdiction) determines permit requirements, and Ready Companies must comply.
Payment Draw Structure:
Understanding payment timing prevents cash flow crises. Mortgage companies (not homeowners) often hold insurance proceeds and release funds based on inspection-verified completion milestones. Typical draw structure: 30-50% initial, 40-60% mid-project (after framing/rough-in inspections), 10-20% final (after completion). Ready Companies NEVER begins work without confirmed initial draw receipt.
Site Preparation:
- Material storage: Weather-protected location for lumber, drywall, flooring
- Dumpster placement: Accessible for demo debris, properly permitted if needed
- Temporary power: Establish if service is disconnected
- Temporary toilet facilities: Required if property unoccupied
- Safety signage: Post required OSHA notices and customer safety warnings
- Customer expectations: Discuss timelines, occupied areas, daily schedules
π Permit Requirements
Common work requiring permits:
- β’ Structural repairs (framing, load-bearing walls)
- β’ Electrical system work
- β’ Plumbing alterations
- β’ HVAC installation/replacement
- β’ Roof structural repairs (not just shingles)
- β’ Window/door replacements (some jurisdictions)
π° Draw Payment Triggers
Typical inspection requirements for payment release:
- β’ Initial: Signed contract + scope approval
- β’ Mid: Framing complete, rough-in inspections passed
- β’ Final: Certificate of completion, final walkthrough
- β’ Depreciation release: Final invoice + photos
Construction Execution & Sequencing
Expectation:
Follow proper construction sequencing: demolition β structural repairs β rough-in (electrical/plumbing/HVAC) β inspections β insulation β drywall β interior finishing β flooring β final trim. Verify each phase is 100% complete before advancing. Pay subcontractors only after work verification. Perform in-process quality checks throughout. Request progress draws at appropriate milestones.
The "Why" - Preventing Costly Rework:
Improper sequencing creates expensive rework. Installing drywall before electrical/plumbing rough-in inspections pass requires demo and reinstallationβtypical cost $2,000-$5,000 per occurrence. Paint before trim installation creates touch-up costs and visible defects. Flooring before final paint risks damage requiring replacement. Each phase builds on the previous; skipping ahead compromises quality and profit.
Ready Companies Standard Sequence:
- Demolition: Walk job with demo vendor. Clearly mark save items. Coordinate odor treatment/structure cleaning after demo.
- Structural Repairs: Framing, roof structure, windows/doors. Order materials: lumber, exterior doors/windows, siding, garage doors.
- Rough-In Systems: Electrical, plumbing, HVAC. Verify budget approved for this phase. Call inspections when ready.
- Inspections PASS: DO NOT proceed until rough-in inspections pass. Schedule re-inspection if failed.
- Insulation & Drywall: After inspections pass, install insulation, hang drywall, tape/texture. Order cabinets, trim, doors.
- Interior Doors, Trim, Cabinets: Install before paint. Verify all hardware fits properly.
- Paint: Interior/exterior walls, trim, doors, cabinets. Complete ALL paint before flooring (except wood floor trim).
- Countertops: Measure/template after cabinets installed. Order. Install with wall caps.
- Tile: Install wall and floor tile. Measure for mirrors and shower glass.
- Mechanical Trim: Faucets, fixtures, lights, switches/plates, HVAC grills, smoke detectors.
- Flooring: After all paint complete. Engineered/laminate/vinyl plank OR sand/stain/finish hardwood.
- Baseboard/Trim: Install base and shoe mold on flooring and cabinets.
- Final Installations: Appliances, mirrors, shower glass, gutters, screens.
- Attic Insulation: Blow insulation if applicable.
- Meters & Systems Start: Schedule meter inspections, get meters installed, start HVAC system.
- Hot Check: Test EVERY light, switch, outlet, appliance, faucet (hot/cold), drain, tub, shower, toilet.
- Final Cleaning: Deep clean including windows if in scope. Haul all trash.
- Carpet (if applicable): Install as last flooring step.
Vendor & Subcontractor Management:
Ready Companies pays subcontractors ONLY after 100% work verification. Walk each completed phase with vendor before processing payment. Verify insurance certificates are currentβlapses create liability exposure averaging $50,000-$500,000 per incident. Coordinate schedules so trades don't overlap inefficiently.
Quality Control Checkpoints:
- Framing: Level, plumb, square, proper fastening
- Rough-in: Code-compliant installation, proper support/fastening
- Drywall: Smooth finish, properly taped corners, no visible fasteners
- Paint: Even coverage, clean lines, no drips/runs
- Tile: Level, proper grout lines, waterproofing verified
- Flooring: Flat transitions, no gaps, proper acclimation
β οΈ CRITICAL: Inspection Requirements
Building inspections are NON-NEGOTIABLE checkpoints. DO NOT install drywall before rough-in inspections pass. DO NOT install flooring before final inspections. Proceeding without passed inspections creates rework costs and potential code violations that can halt project completion.
Rework cost for premature drywall installation: $2,000-$5,000. Multiply by every room affected.
Completion & Closeout
Expectation:
Conduct thorough customer walkthrough. Address punch-list items immediately. Obtain signed Certificate of Completion. Coordinate contents return with contents department. Get final building inspection approval. Submit final scope to carrier with completion letter and photos to release depreciation. Request final payment. Follow up until payment received and posted.
The "Why" - Professional Closure:
The final walkthrough determines customer satisfaction and triggers final payment. Incomplete punch lists delay payment and damage Ready Companies reputation. The Certificate of Completion is legal documentation that work is complete per agreed scopeβinsurance companies require this to release depreciation (typically 10-30% of total claim value held until completion proof).
Final Walkthrough Protocol:
- Schedule walkthrough when 100% complete (customer + Ready Companies rep)
- Walk every room methodically. Note any concerns on punch list.
- Test all mechanical systems with customer present (lights, HVAC, plumbing)
- Review warranty information for workmanship and materials
- Complete final touch-ups immediately (paint, caulk, minor adjustments)
- Obtain signed Certificate of Completion
Depreciation Release:
Insurance companies withhold depreciation until completion proof is provided. Submit: (1) Final scope including all supplements, (2) Certificate of Completion signed by customer, (3) Final photos showing completed work. Depreciation typically releases within 7-14 days of submission if documentation is complete.
Warranty Documentation:
Provide customer with: Ready Companies workmanship warranty (typically 1 year), manufacturer warranties for materials/appliances, subcontractor warranties for specialized trades, and contact information for warranty claims. Establish follow-up system to address warranty issues promptly.
β Completion Checklist
- β’ Customer walkthrough complete
- β’ Punch list items resolved
- β’ Final inspections passed
- β’ Certificate signed
- β’ Contents returned
- β’ Warranty info provided
π Final Documentation
- β’ Final scope with supplements
- β’ Certificate of Completion
- β’ Final photos (before/after)
- β’ Final invoices
- β’ Warranty documentation
- β’ Permit closeout certificates
π° Payment Closeout
- β’ Final draw requested
- β’ Depreciation submitted
- β’ Customer balance collected
- β’ All vendor invoices paid
- β’ Project financially closed
Ready Companies Reconstruction Standards
Core Principles
- β Never start without verified payment
- β Follow proper construction sequencing
- β Obtain required permits before work begins
- β Pass inspections before proceeding to next phase
- β Pay vendors only after work verification
- β Document everything with photos and notes
Quality Standards
- β 100% completion before phase advancement
- β Code-compliant installation on all trades
- β Professional finish quality throughout
- β Hot check all systems before customer walkthrough
- β Address punch list items immediately
- β Provide comprehensive warranty documentation
Financial Operations
Master the financial fundamentals of running a profitable restoration business. Learn pricing strategy, cost management, cash flow optimization, and financial decision-making to build sustainable business growth.
Financial Literacy for Business Owners
If you've never run a business before, understanding finances can feel overwhelming. This training assumes zero prior knowledge and builds your financial literacy step-by-step. You'll learn how money flows through a restoration business, how to price profitably, manage costs, and make financial decisions that support long-term success.
Key Concept: Running a profitable restoration business requires understanding three fundamental truths: (1) Revenue alone doesn't equal profit, (2) Cash flow is more important than profit on paper, and (3) Every dollar you earn must work toward covering costs AND generating profit. Let's build your financial foundation.
Understanding Business Profitability
The Profitability Formula:
Revenue - Expenses = Profit. This seems simple, but most business failures come from misunderstanding what "expenses" truly includes and what "profit" actually means for business sustainability.
Three Types of Money in Your Business:
- Revenue (Gross Income): All money coming into your business from jobs. If you bill $100,000 in a month, that's your revenue. This is NOT your profit.
- Expenses (Costs): ALL money going out to operate your business. This includes job materials, labor, rent, insurance, truck payments, fuel, marketing, software, and more. Most new owners underestimate their true expenses.
- Profit (Net Income): What's left after ALL expenses are paid. This is the money that pays you as the owner and funds business growth. Many restoration businesses operate at 10-20% net profit margins when managed properly.
The Two Categories of Expenses:
1. Job Costs (Direct Costs / Cost of Goods Sold)
These expenses are directly tied to specific jobs and vary with your workload:
- Materials and supplies used on the job (drywall, paint, flooring)
- Labor costs for technicians working on that specific job
- Subcontractor fees for that job
- Equipment rentals specific to the job
- Disposal fees for that project
Example: A water mitigation job costs you $2,000 in materials, $1,500 in labor, and $500 in equipment rentals = $4,000 total job cost.
2. Overhead Costs (Fixed Costs / Operating Expenses)
These expenses occur whether you have jobs or not and stay relatively consistent month-to-month:
- Office rent or mortgage
- Truck/vehicle payments and maintenance
- Insurance (liability, workers comp, vehicle)
- Utilities (electric, water, phone, internet)
- Software subscriptions (Job-Dox, Xactimate, QuickBooks)
- Administrative salaries
- Marketing and advertising
- Licenses and permits
- Professional services (accountant, lawyer)
- Equipment you own (depreciation)
Example: Your monthly overhead might be $15,000-$25,000 even with zero jobs. You MUST generate enough revenue to cover this baseline cost every month.
Why This Distinction Matters:
Job costs scale with work volume - more jobs = more job costs. Overhead costs remain relatively fixed - you pay rent whether you have 5 jobs or 50 jobs that month. Understanding this difference is critical for break-even analysis and pricing strategy.
Common Fatal Mistake:
New business owners see revenue and think "I'm making money!" Then wonder why there's nothing left at month-end. Every dollar of revenue must cover job costs PLUS a portion of overhead PLUS profit. If you're not pricing to cover all three, you're operating at a loss even when you're busy.
β Profitability Indicators
- β’ Gross profit margin: 50%+ on each job
- β’ Net profit margin: 10-20% of total revenue
- β’ Revenue consistently exceeds break-even point
- β’ Cash reserves building month over month
- β’ Owner compensation is a line item, not "what's left"
β οΈ Warning Signs
- β’ Gross profit margin below 50% per job
- β’ Consistently unable to pay bills on time
- β’ Using new job revenue to pay old job expenses
- β’ Owner working 60+ hours for minimal take-home
- β’ No emergency fund or cash reserves
Margins and Markups: The Pricing Foundation
Understanding Markup vs. Margin:
These terms are often confused but represent different ways of viewing profitability. Both are critical for pricing strategy.
MARKUP: Percentage Added to Your Cost
Markup is how much you add to your cost to determine your selling price. It's calculated based on what you paid.
Formula: Markup % = (Selling Price - Cost) Γ· Cost Γ 100
Example 1: A job costs you $5,000. You charge the customer $10,000.
Markup = ($10,000 - $5,000) Γ· $5,000 Γ 100 = 100% markup
Example 2: Materials cost $1,000. You apply 100% markup and charge $2,000.
Ready Companies Standard: Aim for 100% markup on all job costs whenever possible. This provides the cushion needed to cover overhead and generate profit.
MARGIN: Percentage of Selling Price That's Profit
Margin (also called gross profit margin) is how much of your selling price is profit. It's calculated based on what the customer pays.
Formula: Margin % = (Selling Price - Cost) Γ· Selling Price Γ 100
Example 1: Same job - cost you $5,000, charged customer $10,000.
Margin = ($10,000 - $5,000) Γ· $10,000 Γ 100 = 50% margin
Example 2: Materials cost $1,000, charged $2,000 (100% markup)
Margin = ($2,000 - $1,000) Γ· $2,000 Γ 100 = 50% margin
Ready Companies Standard: Maintain at least 50% gross profit margin on each job. Margins below 50% are a warning sign of business failure risk.
π― The Connection: 100% Markup = 50% Margin
Notice the pattern: When you apply a 100% markup, you automatically achieve a 50% margin. This is the mathematical relationship:
- 100% markup means doubling your cost
- If something costs $50 and you charge $100 (100% markup), half your sale price is profit (50% margin)
- This is the minimum standard for sustainable restoration businesses
Why 50% Margin is the Minimum Standard:
Remember that gross profit (your margin) must cover overhead costs AND provide net profit. Here's the breakdown:
- Job Cost: 50% - Covers materials, labor, direct expenses
- Overhead: 30-35% - Covers rent, insurance, vehicles, salaries, marketing, software
- Net Profit: 10-20% - What's left for owner compensation and business growth
If your margin drops below 50%, there's not enough gross profit to cover overhead AND generate net profit. You're losing money even when busy.
Critical Warning:
Many restoration companies fail by pricing too low - they win lots of jobs with 30-40% margins, stay extremely busy, but end the year broke or in debt. High revenue with low margins is a recipe for bankruptcy. It's better to do fewer jobs at healthy margins than many jobs at slim margins.
Real-World Example:
Scenario: Water Mitigation Job
Your Costs:
- Labor: $1,500
- Equipment: $500
- Materials: $500
- Disposal: $200
- Total Job Cost: $2,700
Your Pricing (100% Markup / 50% Margin):
- Customer Charge: $5,400 (double the cost)
- Gross Profit: $2,700 (50% of sale price)
What Happens to Gross Profit:
- Overhead allocation (~$1,800): Covers your share of rent, insurance, vehicle, marketing, etc.
- Net Profit (~$900): 16.7% net margin - healthy and sustainable
Result: Profitable job that contributes to business health and owner compensation.
π Quick Reference: Markup vs Margin Chart
50% Markup
= 33% Margin (Too Low!)
75% Markup
= 43% Margin (Still Low)
100% Markup β
= 50% Margin (Minimum!)
150% Markup β
= 60% Margin (Excellent)
Break-Even Analysis & Cash Flow Management
Understanding Your Break-Even Point:
Your break-even point is the minimum monthly revenue required to cover all expenses without making or losing money. Every dollar above break-even is profit; every dollar below is a loss.
Break-Even Formula
Break-Even Revenue = Fixed Costs (Overhead) Γ· Gross Profit Margin %
Example Calculation:
- Monthly overhead (fixed costs): $20,000
- Average gross profit margin: 50%
- Break-even = $20,000 Γ· 0.50 = $40,000/month minimum revenue
This means you need $40,000 in revenue just to cover expenses. Any revenue beyond $40,000 becomes net profit (after accounting for job costs).
Why This Matters:
- Knowing your break-even point tells you exactly how much work you need every month
- It helps you evaluate whether slow months will create financial problems
- It guides decisions about adding overhead (new truck, employee, office space)
- It shows whether your current pricing strategy is sustainable
Cash Flow vs. Profit: A Critical Distinction
You can be profitable on paper but run out of cash - this is the #1 cause of business failure in restoration. Here's why:
Profit on Paper (Accrual Accounting)
When you complete a $10,000 job with $5,000 in costs, you've made $5,000 profit - on paper. Even if the customer hasn't paid yet.
Problem: Your accounting shows profit, but you can't pay bills with invoices. You need actual cash.
Cash Flow (Cash Accounting)
Cash flow tracks actual money in your bank account. You're cash-flow positive when more money comes in than goes out each month.
Reality: In restoration, insurance claims can take 30-90 days to pay. You must pay employees, suppliers, and overhead NOW while waiting for customer/insurance payment.
The Cash Flow Gap Trap:
Many restoration companies fail this way: They get lots of jobs (profitable on paper), but payments are delayed. They use revenue from new jobs to pay expenses from old jobs. When work slows down or a big payment is delayed, they can't make payroll or pay suppliers. Despite being "profitable," they go out of business.
Cash Flow Management Strategies:
- Maintain Cash Reserves: Keep 2-3 months of overhead in a business savings account. This cushions payment delays.
- Collect Deposits: Get 30-50% upfront on reconstruction jobs. This funds initial costs and reduces cash flow risk.
- Progress Billing: Invoice insurance companies at project milestones (after demo, after framing, after drywall). Don't wait until completion.
- Follow Up on Receivables: Track every invoice. Call insurance adjusters if payment is delayed beyond 30 days. Aging receivables kill cash flow.
- Negotiate with Suppliers: If possible, get NET 30 terms with suppliers so you're not paying for materials before getting customer payment.
- Use Job-Dox Financial Tracking: Monitor cash flow projections, receivables aging, and payment status in real-time.
Real-World Cash Flow Example:
Month 1:
- Complete 5 jobs totaling $50,000 revenue (profitable!)
- Job costs: $25,000 (paid immediately to suppliers/employees)
- Overhead: $20,000 (paid immediately - rent, insurance, etc.)
- Customer payments received: $15,000 (only 30% collected so far)
- Cash Position: -$30,000 (You're $30,000 short despite being profitable)
Solution: Either have cash reserves to cover the gap, or collect deposits upfront to fund immediate costs.
π Healthy Cash Flow
- β’ 2-3 months overhead in reserves
- β’ Collect 30-50% deposits
- β’ Invoice at project milestones
- β’ Receivables under 30 days average
- β’ Never late on bills
β οΈ Cash Flow Warning Signs
- β’ No cash reserves
- β’ Using new job money for old bills
- β’ Receivables over 45 days old
- β’ Occasionally late on bills
- β’ Stressed about next payroll
π¨ Cash Crisis
- β’ Can't make payroll
- β’ Suppliers demanding COD
- β’ Receivables 60+ days overdue
- β’ Considering business loans for operations
- β’ Personal money covering business
Pricing Strategy & Communicating Value
What is "Fair and Reasonable" Pricing?
Fair and reasonable pricing isn't the lowest price - it's pricing that reflects the quality, expertise, and value you provide while ensuring your business remains profitable and sustainable. Customers may want the lowest price, but that's not fair to your business or sustainable for delivering quality service.
π« The Low-Price Trap
Many restoration companies fail by competing on price. Here's what happens:
- Win lots of jobs with low prices (20-30% margins)
- Stay extremely busy with full schedules
- Work 60+ hour weeks trying to keep up
- End the year with high revenue but little or no profit
- Can't afford to hire help, upgrade equipment, or take time off
- Eventually burn out or go out of business despite being "busy"
Lesson: High volume at low margins is NOT a sustainable business model. It's better to do fewer jobs at healthy margins.
DON'T Break Down Your Costs to Customers:
One of the most common pricing mistakes is providing itemized cost breakdowns to customers. Here's why this hurts your business:
What Happens When You Break Down Costs:
You tell customer: "Materials $2,000, Labor $3,000, Total $5,000"
Customer goes online and finds:
- Those materials retail for $1,200 at Home Depot
- Thinks you're overcharging $800 on materials
- Doesn't understand business costs: your supplier relationship, delivery, handling, warranty, insurance, overhead
- Focuses on your markup instead of your value
- Asks for discounts or shops around
Result: Customer conflict and pressure to lower your prices, destroying your margins.
Present Complete Project Pricing Instead:
Quote the complete job price: "Your water restoration project is $10,000." Don't volunteer material/labor breakdowns. Here's what to emphasize:
- Expertise: "We're IICRC certified with 15 years experience"
- Quality: "We use professional-grade equipment and materials"
- Speed: "We'll have your property dried out in 3-5 days"
- Insurance Knowledge: "We work directly with your insurance company"
- Warranty: "All work is warrantied for 1 year"
- Availability: "24/7 emergency response"
Insurance Work Exception:
When working with insurance adjusters and estimates, you may need to provide detailed Xactimate line items. This is a different conversation than consumer pricing - you're speaking the adjuster's language and negotiating based on industry-standard pricing databases. Adjusters understand markups and margins; homeowners typically don't.
How to Handle Price Objections:
Objection: "That's too expensive / I can get it cheaper elsewhere"
Response Framework:
"I understand price is important. The difference in our pricing reflects the quality of work, our certifications, and the speed of service. Cheaper options often use less experienced technicians or lower-grade equipment, which can lead to incomplete drying and mold problems later. We're focused on doing it right the first time. Can I walk you through exactly what our service includes?"
Objection: "No one else charges for [specific item]"
Response Framework:
"Every company structures their pricing differently. We include [item] because it's essential for proper results. Companies that don't charge for it separately are either absorbing that cost (which usually means cutting corners elsewhere) or they'll surprise you with it as an 'extra' later. Our pricing is transparent and complete upfront."
Objection: "Can you give me a discount?"
Response Framework:
"Our pricing reflects the quality and expertise we provide. If I discount the price, I'd have to cut corners on service, materials, or warranty - and that wouldn't be fair to you. What I quoted is our best price for the level of service you deserve. However, we do offer [payment plans / financing] to help manage the investment."
Never Negotiate From Your Quote:
If you lower your price once, customers will always expect it. They'll tell friends "just ask for a discount." This trains the market that your prices are negotiable, which destroys your margins and positioning. Stand firm on your pricing or lose the job - losing some price-sensitive customers is better than training all customers to negotiate.
Payment Options (Not Discounts):
Instead of discounting, offer ways to make payment easier:
- Payment plans (3-6 month installments)
- Financing through partners (affirm, GreenSky, etc.)
- Multiple payment methods (credit card, ACH, check)
- Insurance direct billing (we collect from insurance)
This maintains your price while showing flexibility on payment terms.
π¬ Pricing Conversation Scripts
Opening Statement:
"Based on my assessment, your complete restoration will be $X,XXX. This includes all materials, labor, equipment, and warranty. We can start as early as tomorrow and have you back to normal within [timeframe]."
Value Emphasis:
"We're IICRC certified, fully insured, and we've been doing this for [X] years. You're getting professional-grade service with a warranty. We work directly with insurance companies, so there's no hassle on your end."
Closing:
"I can get you on the schedule right away. How does [day/time] work for you to get started?"
Tax Considerations & Compliance
Understanding Business Taxes:
Taxes are one of your largest business expenses and a legal obligation. Failing to account for them properly can destroy your cash flow and create serious legal problems. Here's what every restoration business owner needs to know:
π¨ Tax Planning is NOT Optional
Common scenario: Business has a great year with $500,000 revenue and $100,000 profit. Owner spends profit throughout the year. April arrives and tax bill is $30,000-$40,000. Owner has no cash to pay it.
Result: IRS penalties, interest, payment plans, and potential liens. This destroys credit and creates multi-year financial problems.
Types of Taxes Your Business Pays:
- Income Tax (Federal & State): Tax on your business profit. Rates vary by business structure (LLC, S-Corp, C-Corp) and location. Plan to set aside 25-35% of profit for income taxes.
- Self-Employment Tax: If you're a sole proprietor or LLC, you pay both employer and employee portions of Social Security and Medicare (15.3% on profits up to $160,200). This is in ADDITION to income tax.
- Payroll Taxes: If you have employees, you withhold income tax and FICA from their paychecks, plus pay employer-side FICA (7.65%). These must be remitted to IRS on strict schedules or face penalties.
- Sales Tax: Many states require sales tax on restoration services or materials. You collect this from customers and remit to the state. NOT collecting it properly can result in the business owing it from profits.
- Property Tax: If you own your building, equipment, or vehicles, you may owe property tax to local jurisdictions.
- Business License & Permit Fees: Annual renewal fees for business licenses and contractor licenses.
Critical: Set Aside Tax Money as You Earn It
The biggest tax mistake is spending all your profit and having nothing left when taxes are due. Here's the system:
β The Tax Savings Account Method
- Open a separate business savings account called "Tax Reserve"
- Every time you get paid or make a profit withdrawal, immediately transfer 30% to tax reserve
- NEVER touch this account except to pay quarterly estimated taxes and annual tax bill
- If there's excess at year-end (because your rate was lower), that's a bonus
- If there's a shortage, it's small and manageable
Example: Make $10,000 profit this month? Transfer $3,000 to tax reserve immediately. You can only spend/use the remaining $7,000.
Quarterly Estimated Tax Payments:
If you expect to owe more than $1,000 in taxes, the IRS requires quarterly estimated payments (due April 15, June 15, Sept 15, Jan 15). Failing to make these results in penalties even if you pay the full amount at tax time.
Work with your accountant to calculate quarterly payments based on projected annual profit. It's better to overpay slightly and get a refund than underpay and owe penalties.
Including Taxes in Your Pricing:
- Sales Tax: If your state requires it, always add sales tax to customer invoices as a separate line item. Make it clear this goes to the state, not to you.
- Income Tax: This comes from your profit, so it's already included in your pricing if you're maintaining proper margins. Remember: your 50% gross margin needs to cover overhead AND taxes AND net profit.
Work with a Tax Professional:
The cost of a good CPA or tax accountant ($2,000-$5,000/year) pays for itself many times over through:
- Maximizing deductible business expenses
- Choosing optimal business structure (LLC vs S-Corp can save thousands)
- Ensuring compliance with all tax laws
- Strategic tax planning to minimize liability
- Handling audits or IRS correspondence
- Peace of mind that you're doing it right
Common Tax Mistakes to Avoid:
- Not setting aside tax money from each payment/profit
- Missing quarterly estimated tax payments
- Mixing personal and business expenses (kills deduction clarity)
- Not tracking mileage and expenses properly
- Not collecting/remitting sales tax when required
- Paying employees as "independent contractors" to avoid payroll taxes (IRS will reclassify and penalize)
- Not keeping receipts and documentation for deductions
- Filing taxes late without extension
π Tax Compliance Checklist
Monthly:
- β Set aside 30% of profit in tax reserve
- β Track all business expenses with receipts
- β Record business mileage
- β Reconcile bank accounts
Quarterly:
- β Make estimated tax payment (if required)
- β Review P&L with accountant
- β Adjust tax withholding if needed
- β File payroll tax returns
Annually:
- β Provide accountant with financial records
- β File business tax return
- β File personal tax return
- β Issue 1099s to contractors
As Needed:
- β Renew business licenses
- β File sales tax returns
- β Update estimated tax calculations
- β Consult CPA for major decisions
Ready Companies Financial Standards
Core Financial Principles
- β 100% markup / 50% minimum gross profit margin on all jobs
- β Understand your break-even point and exceed it monthly
- β Maintain 2-3 months overhead in cash reserves
- β Set aside 30% of all profit for taxes immediately
- β Never break down costs to customers - quote complete project value
- β Stand firm on pricing - don't negotiate from your quote
Financial Health Indicators
- β Net profit margin: 10-20% of revenue
- β Positive cash flow every month
- β Receivables collected within 30 days average
- β Can make payroll 2 months ahead without new revenue
- β Owner compensation is budgeted line item, not "what's left"
- β Business grows year-over-year without owner burnout
"Profit isn't what's left after expenses - expenses are what's left after you've ensured profit."
- Ready Companies Financial Principle
Team Scaling & Leadership
Build a high-performing restoration team that operates without you. Master hiring, training, delegation, and leadership systems that allow you to scale revenue while reducing your operational involvement.
Ready Pro Coaching: Your Personal Business Advisors
This training provides the knowledge foundation for scaling and leadership. However, implementing these systems in YOUR specific business requires customized strategy. That's why Ready Pro Coaching includes direct access to our team for personalized consulting.
What Live Coaching Includes:
- β Monthly 1-on-1 Strategy Calls: Review your progress, troubleshoot challenges, refine your approach
- β Custom Org Chart Development: We help design your specific team structure based on your revenue and goals
- β Hiring & Interview Support: Review job descriptions, interview candidates with you, help make hiring decisions
- β Training Program Customization: Adapt our systems to your company's specific processes and culture
- β Leadership Coaching: Develop your management and delegation skills through real-world application
- β Accountability & Milestones: We keep you on track with structured implementation timelines
Study the content below to understand the principles. Then work with our team to implement them in your business. You're not doing this alone - we've scaled dozens of restoration companies and will guide you through every step.
The Owner's Dilemma: Why You Can't Scale Alone
The Trap Most Owners Fall Into:
You started your restoration business to build wealth and freedom. Instead, you've built a demanding job that consumes 60-80 hours per week. You're the lead technician, project manager, salesperson, accountant, and operations manager - all at once. When you're not working, the business stops. When you want time off, revenue drops. You're trapped.
π« The "I Am The Business" Syndrome
Common scenario: Owner works 70+ hours/week. Makes $150K-$250K/year. Handles everything personally. Can't take vacation without business suffering. Staff constantly asks "what should I do?" Business has revenue but owner has no freedom.
This is not a business - it's self-employment. Your business has no value to buyers because it can't operate without you.
The Hard Truth About Scaling:
There are only 24 hours in a day. You physically cannot do more than what you're doing now. To grow revenue beyond your current ceiling, you must multiply yourself through other people. This requires a fundamental shift from "doing the work" to "leading people who do the work."
Three Business Models - Which Are You?
Model 1: Owner-Operator (Self-Employed)
- Revenue: $200K-$500K/year
- Owner works 60-80 hours/week in operations
- Maybe 1-3 helpers or subcontractors
- Owner does sales, project management, quality control, estimates
- Business stops when owner stops
- No vacation, constant stress, burnout risk
- Business Value: $0-50K (no one will buy it)
Model 2: Working Owner with Team (Transition Stage)
- Revenue: $500K-$2M/year
- Owner works 50-60 hours/week, split between operations and management
- 5-15 employees in various roles
- Some delegation happening but owner still heavily involved operationally
- Business can run 1-2 weeks without owner with struggle
- Systems exist but not fully documented
- Business Value: 1-2x annual profit (limited buyer pool)
Model 3: Absentee Owner with Management Team (Scalable Business) β
- Revenue: $1M-$10M+/year
- Owner works 10-20 hours/week on strategy only
- 15+ employees with defined management structure
- Operations Manager runs daily operations
- Sales Manager handles business development
- Business operates smoothly without owner for months
- All systems documented in operations manual
- Business Value: 3-5x annual profit (highly sellable)
This is your goal. This is what Ready Pro Coaching builds.
The Shift Required:
Moving from Model 1 to Model 3 requires changing your identity from "expert technician" to "business builder." Your job is no longer doing restoration work - it's building systems, developing people, and making strategic decisions. This is uncomfortable because you're great at restoration but you're learning to be great at leadership.
What Holds Owners Back:
- "No one can do it like I can": True - they can't do it EXACTLY like you. But they can do it well enough to satisfy customers at 90% your quality. Perfect is the enemy of scale.
- "It's faster if I just do it myself": True today - you can do in 1 hour what takes a new person 3 hours. But if you invest those 3 hours training them, they'll save you 100+ hours over the next year.
- "I can't afford good people": You can't afford NOT to have them. A $50K/year operations manager who removes 30 hours/week from your plate is worth $100K+ in value to you.
- "I tried hiring and it didn't work": Hiring random people and hoping they figure it out doesn't work. Systematic hiring, proper training, clear expectations, and accountability systems DO work.
- "What if they steal my customers?": Possible but rare. Proper employment agreements, non-competes (where legal), and treating people well prevent this. The bigger risk is working yourself to death.
The Cost of Not Scaling:
- Your health: stress, exhaustion, burnout, health issues
- Your family: missed events, strained relationships, absent parent/spouse
- Your wealth: trading time for money with a hard ceiling
- Your options: can't sell, can't take time off, can't grow beyond you
- Your legacy: business dies when you're gone
π― Your Goal: Build a Business That Runs Without You
This doesn't mean you don't work - it means the business doesn't NEED you to operate. You can choose to be involved in areas you enjoy (sales, strategy, special projects) while systems and people handle everything else. This gives you freedom, options, and a valuable asset you can eventually sell.
The rest of this training shows you exactly how to build it.
Organizational Structure: Building Your Org Chart
Start With the End in Mind:
Before hiring anyone, you need to know what roles exist in a mature restoration business. This prevents random hiring ("I need help, let me hire someone!") and creates intentional team building.
The Core Roles in a Scalable Restoration Business:
π― Owner/CEO (You - Eventually Strategic Only)
Responsibilities:
- Set company vision and strategic direction
- Make major financial decisions (investments, acquisitions, major purchases)
- Develop and maintain key referral relationships (insurance companies, commercial accounts)
- Review financial performance and adjust strategy
- Coach and develop management team
Goal Hours: 10-20 hours/week on strategic work only
π General Manager / Operations Manager (Your First Key Hire)
Responsibilities:
- Runs day-to-day business operations
- Manages production team (mitigation & reconstruction)
- Handles job scheduling and resource allocation
- Quality control and customer satisfaction
- Hiring and firing of field staff (with owner approval)
- Reports to owner with weekly performance metrics
Typical Comp: $60K-$90K/year + performance bonus
This role removes you from operational firefighting
π Office Manager / Administrator
Responsibilities:
- Answer phones and schedule emergency calls
- Customer communication and follow-up
- Job documentation and file management
- Insurance claim documentation
- Accounts receivable follow-up
- Basic bookkeeping and bill payment
Typical Comp: $35K-$50K/year
This role handles administrative burden
πΌ Sales Manager / Estimator (For Reconstruction Focus)
Responsibilities:
- Generate reconstruction leads from mitigation jobs
- Create estimates in Xactimate
- Negotiate scopes with insurance adjusters
- Develop commercial accounts and property manager relationships
- Track sales pipeline and conversion rates
Typical Comp: $50K-$70K base + commission (2-5% of sold jobs)
This role drives revenue growth
π§ Lead Technician / Crew Chief
Responsibilities:
- Lead mitigation or reconstruction crew
- Train and supervise junior technicians
- Quality control on job sites
- Customer communication on-site
- Equipment maintenance
- Job site safety
Typical Comp: $45K-$65K/year or $20-$30/hour
You need 1 per crew of 3-5 people
π οΈ Technicians / Laborers
Responsibilities:
- Perform mitigation or reconstruction work under supervision
- Equipment setup and cleanup
- Follow lead technician instructions
- Basic customer service
Typical Comp: $30K-$45K/year or $15-$22/hour
Entry-level position with growth path to Lead
Hiring Sequence by Revenue Stage:
$250K-$500K Revenue: Solo to First Hires
- Hire #1: Part-time Office Admin (20 hours/week) - Answer phones, schedule, basic paperwork ($15-$20K/year)
- Hire #2: Technician/Helper - Learn the work, eventually run jobs under your supervision ($30-$35K/year)
- Owner Role: Still doing most jobs, estimates, sales. Admin handles phones/paperwork. Helper assists on larger jobs.
$500K-$1M Revenue: Building the Core Team
- Hire #3: Full-time Office Manager - All admin, scheduling, insurance docs, receivables ($40-$45K/year)
- Hire #4: Lead Technician - Can run jobs independently, manages helper ($50-$55K/year)
- Hire #5: Second Technician - Allows two crew operations ($35-$40K/year)
- Owner Role: Doing estimates and sales. Sometimes working jobs. Managing team. Less hands-on work, more coordination.
$1M-$2M Revenue: Adding Management Layer
- Hire #6: Operations Manager - Runs daily operations, manages field crew ($65-$75K/year)
- Hire #7-9: Additional Technicians - Scale to 6-8 field staff across multiple crews
- Hire #10: Estimator/Sales (if reconstruction-focused) - Creates estimates, sells work ($55K base + commission)
- Owner Role: Strategic only. Ops Manager runs operations. Owner focuses on growth, big accounts, financial management.
$2M+ Revenue: Mature Organization
- General Manager: Overall operations
- Sales Manager: Leads business development and estimating team
- Office Manager + Admin Staff: 2-3 people handling phones, docs, billing
- Production Manager: Oversees all field operations
- Lead Technicians: 2-4 crew chiefs
- Technicians: 8-15 field staff
- Owner Role: 10-15 hours/week. Strategic planning, key relationships, financial decisions. Business operates independently.
Critical Mistake to Avoid:
Don't hire random people for random tasks. Hire according to your org chart roadmap. Each hire should move you closer to Model 3 (absentee owner). If a hire doesn't remove significant work from your plate or enable revenue growth, it's the wrong hire.
π Ready Pro Coaching: Custom Org Chart Design
Our team will work with you to design your specific org chart based on your current revenue, growth goals, and market. We'll identify your next 3 hires, write job descriptions, and create your hiring roadmap. This isn't theory - it's your customized blueprint.
Systematic Hiring: Finding and Selecting Top Talent
Why Most Hiring Fails:
Most restoration business owners hire reactively: "I'm overwhelmed, I need help NOW!" They post a vague job ad, interview whoever applies, and hire the person who seems decent. Result: 50%+ of hires don't work out within 6 months. Bad hires cost $30,000-$50,000 in lost productivity, training time, and rehiring.
π« Common Hiring Mistakes
- "Hiring in a hurry" - Taking first acceptable candidate because you're desperate
- "Gut feeling" - Ignoring red flags because you "like" the person
- Unclear job description - Candidate has no idea what they're signing up for
- Skipping reference checks - Assuming resume is accurate
- No skills testing - Hiring based on what they say, not what they can do
- Weak onboarding - New hire left to "figure it out" alone
Each mistake increases failure probability by 20-30%
The Systematic Hiring Process (6 Stages):
Stage 1: Define the Role BEFORE You Need It
Create job descriptions for all roles in your org chart NOW, even if you're not hiring yet. When you need to hire, you have a blueprint ready instead of scrambling.
Job Description Must Include:
- Job Title: Clear role name (Lead Technician, Office Manager, etc.)
- Reporting Structure: Who they report to, who reports to them
- Core Responsibilities: 5-8 main duties (be specific, not generic)
- Success Metrics: How performance is measured (response time, customer satisfaction, revenue targets)
- Required Skills: Must-have technical and soft skills
- Preferred Skills: Nice-to-have qualifications
- Certifications: IICRC, OSHA, driver's license requirements
- Physical Requirements: Lifting, climbing, working in confined spaces
- Schedule: Hours, on-call expectations, overtime
- Compensation Range: Salary/hourly range (be transparent)
Pro Tip: Ready Pro Coaching provides job description templates for every restoration role. We'll customize them for your business.
Stage 2: Source Candidates (Where to Find Quality People)
Don't just post on Indeed and hope. Use multiple channels to build a candidate pipeline:
Best Sources for Restoration Talent:
- Indeed / ZipRecruiter: Largest candidate pools, use specific job titles and keywords
- Trade Schools / Technical Colleges: Partner with local schools for entry-level pipeline
- IICRC Training Centers: Already-certified candidates looking for opportunities
- Competitor Poaching: Identify top performers at other restoration companies (be ethical)
- Employee Referrals: Your best employees know other quality people (offer $500-$1,000 referral bonus)
- Facebook Groups: Local restoration/construction groups, community job boards
- Military Transition Programs: Veterans often excel in restoration (discipline, teamwork, problem-solving)
- "Always Hiring" Approach: Keep job postings live even when not actively hiring. Build candidate database for when you need someone.
Stage 3: Screen Candidates (Filter the Pool)
Goal: Reduce 100 applicants to 5-8 worth interviewing. Use systematic screening to save time:
Screening Process:
- Resume Review (2 minutes per resume): Look for relevant experience, employment stability (not job-hopping every 6 months), required certifications, clear communication in writing.
- Phone Screen (10-15 minutes): Call top candidates. Ask:
- Why are you looking for new opportunity?
- What's your restoration experience?
- What are your salary expectations?
- Can you work [required schedule]?
- Do you have [required certifications/license]?
- When could you start?
- Knockout Questions: If they can't meet non-negotiable requirements (schedule, certifications, salary range), thank them and end screening. Don't waste time interviewing incompatible candidates.
Goal: Narrow to 5-8 candidates who meet all basic requirements and are worth an in-person interview.
Stage 4: Interview (Assess Fit and Capability)
The interview should validate they can do the job AND will fit your culture. Use structured interviews with the same questions for all candidates.
Behavioral Interview Questions (Ask Everyone):
- "Tell me about a time you dealt with a difficult customer. How did you handle it?"
- "Describe a situation where you had to learn something new quickly on a job."
- "Give me an example of when you had to work with a team member you didn't get along with."
- "Tell me about a mistake you made at work. What did you do?"
- "Why did you leave your last job?" (Watch for badmouthing former employer)
- "Where do you see yourself in 3 years?" (Assess ambition and longevity)
Technical/Skills Questions (Role-Specific):
- Technician: "Walk me through how you'd set up drying equipment for a water loss."
- Estimator: "How do you handle an insurance adjuster who's cutting your estimate?"
- Manager: "How would you handle an employee who's consistently late?"
Red Flags: Can't give specific examples (vague answers), blames others for problems, no questions about the role/company, unprofessional appearance/communication.
Stage 5: Skills Assessment & Reference Checks
Interview performance doesn't equal job performance. Test their actual skills:
Skills Testing Examples:
- Technician: Have them set up equipment, take moisture readings, explain their process
- Estimator: Give them sample photos and ask them to outline scope/estimate
- Office Admin: Have them organize sample files, draft customer email, handle mock phone call
Reference Checks (CRITICAL - Don't Skip):
- Call 2-3 previous employers/supervisors (not just references they provide)
- Ask: "Would you rehire this person?" "What were their strengths/weaknesses?" "How was their attendance/reliability?"
- Listen for hesitation or lukewarm responses - these are red flags
- Verify employment dates and reason for leaving
Warning: 30-40% of candidates lie on resumes about experience, dates, or certifications. Reference checks catch this.
Stage 6: Offer & Onboarding
Once you've selected your top candidate, make a professional offer and set them up for success:
Written Offer Letter Must Include:
- Job title and reporting structure
- Compensation (salary/hourly rate)
- Benefits (health insurance, PTO, etc.)
- Start date and schedule
- Probationary period (typically 90 days)
- At-will employment statement
- Contingencies (background check, drug test if applicable)
First Day Preparation:
- Have workspace/equipment ready
- Prepare employee handbook and paperwork (I-9, W-4, insurance forms)
- Assign mentor/buddy for first week
- Schedule orientation and training
- Introduce to team
First impressions matter. Professional onboarding shows you're organized and sets expectations from day one.
Critical Hiring Principles:
- Hire slow, fire fast: Take time to find right person. If it's not working out after 30-60 days, cut ties quickly.
- Culture fit matters as much as skills: You can train skills, you can't train attitude. Hire people who align with your values.
- Never compromise on "must-haves": Required certifications, schedule availability, core skills are non-negotiable.
- Trust but verify: Check references, test skills, confirm certifications. People inflate resumes constantly.
π Ready Pro Coaching: Hiring Support
We provide job description templates, interview question banks, skills assessment rubrics, and offer letter templates. Plus, we can review candidates with you, sit in on interviews, and help make hiring decisions. You're not guessing - you have experienced advisors.
Training Programs: Developing Your Team's Capabilities
Why Training Programs Matter:
Hiring good people is only half the battle. Without structured training, even talented employees struggle to perform at the level you need. Most restoration businesses do "shadow training" - new hire follows someone around for a few days and hopes they pick it up. This results in inconsistent quality, knowledge gaps, and employees who never reach their full potential.
π« The Cost of Poor Training
- Customer complaints: Untrained employees make mistakes that damage your reputation
- Rework costs: Jobs done incorrectly must be redone at your expense
- Safety incidents: Improper training leads to injuries and workers comp claims
- High turnover: Employees who feel unprepared quit within 90 days
- Owner burnout: You're constantly fixing mistakes instead of focusing on growth
Poor training costs 3-4x more than investing in proper training upfront
The 30/60/90 Day Onboarding Framework:
New employees need a clear roadmap for their first 3 months. This framework sets expectations, tracks progress, and ensures they're fully capable by day 90.
Days 1-30: Foundation Building
Goals:
- Learn company culture, policies, and procedures
- Understand safety protocols and OSHA requirements
- Master basic technical skills for their role
- Shadow experienced team members on jobs
- Build relationships with team
Week 1 - Orientation:
- Day 1: Complete HR paperwork, review employee handbook, safety training, facility tour, meet team
- Day 2-3: Equipment familiarization, tool training, vehicle operation
- Day 4-5: Shadow lead technician on actual jobs (observe only)
Week 2-4 - Skill Development:
- Begin hands-on work under supervision
- Learn specific processes (water extraction, equipment placement, demo procedures)
- Practice customer communication basics
- Complete initial safety certifications
- Daily check-ins with supervisor for questions/feedback
Day 30 Evaluation: Can they perform basic tasks with supervision? Are they reliable and safe? Do they fit the culture?
Days 31-60: Independent Work Development
Goals:
- Work independently on routine tasks
- Handle customer interactions professionally
- Make basic decisions without constant supervision
- Begin specialized training for role
Activities:
- Lead portions of jobs while experienced tech observes
- Practice documentation and reporting
- Handle customer questions with coach present
- Start IICRC certification courses (if required)
- Weekly feedback sessions with manager
Day 60 Evaluation: Can they complete jobs with minimal supervision? Are they meeting quality standards? Ready for more responsibility?
Days 61-90: Full Integration & Specialization
Goals:
- Perform all job duties independently
- Meet productivity and quality benchmarks
- Identify areas for continued development
- Complete required certifications
Activities:
- Run jobs independently (solo or leading helper)
- Handle full customer lifecycle on assigned jobs
- Participate in team training sessions as experienced member
- Begin cross-training in other areas
- Set performance goals for next 6 months
Day 90 Evaluation: Performance review, compensation discussion, career path conversation. Make permanent hire decision.
Technical Skills Training Checklists:
Create detailed checklists for each skill that employees must master. Check off each item when they demonstrate competency.
Water Mitigation Technician Checklist Example:
Equipment Skills:
- β Operate water extraction equipment
- β Set up air movers properly
- β Place dehumidifiers effectively
- β Use moisture meters accurately
- β Document moisture readings
Process Skills:
- β Assess water damage extent
- β Identify affected materials
- β Execute proper demo procedures
- β Monitor drying progress
- β Complete job documentation
Customer Service Training:
Technical skills alone don't make great employees. They must represent your brand professionally to customers.
Customer Service Standards - All Employees Must:
- Arrive on time (call customer if running late)
- Wear clean uniform with company branding
- Introduce themselves and explain what they'll be doing
- Use floor protection and booties in customer homes
- Answer customer questions patiently and honestly
- Clean up work area before leaving
- Ask customer if they have any concerns before departing
- Follow up within 24 hours after job completion
Role-play scenarios during training: difficult customer, scope change request, billing question, damage discovery
Certification Requirements & Career Paths:
Show employees how they can grow within your company. Clear career progression increases retention and motivation.
Example Career Path - Technician Track:
- Entry Technician ($15-$18/hr): Learns basics, assists on jobs, no certifications required initially
- Technician ($18-$22/hr): IICRC WRT certified, works independently, 6+ months experience
- Lead Technician ($22-$28/hr): IICRC ASD certified, supervises helpers, 2+ years experience
- Crew Chief ($28-$35/hr): Multiple IICRC certs, manages crew, trains new techs, 3+ years
- Field Supervisor ($40K-$55K salary): Oversees multiple crews, quality control, 5+ years
Ongoing Training & Development:
- Monthly Team Meetings: Review procedures, share lessons learned, address issues
- Quarterly Skills Refreshers: Re-train on critical procedures to prevent bad habits
- Annual Recertification: Test employees on core competencies yearly
- External Training: Send top performers to industry conferences and advanced certifications
- Cross-Training: Teach mitigation techs about reconstruction, expose office staff to field work
Training Investment ROI:
Proper training costs $2,000-$5,000 per employee (time, materials, certifications). But it prevents $20,000-$50,000 in mistakes, rework, and turnover costs. Training isn't an expense - it's the highest-ROI investment in your business.
π Ready Pro Coaching: Training System Development
We provide 30/60/90 day templates, skills checklists for every role, customer service scripts, and training tracking systems. We'll help you build a complete training manual so every new hire gets world-class onboarding.
Delegation Systems: Working ON Your Business, Not IN It
Why Delegation Is So Hard:
You've done every job in your business. You know how it should be done. When you delegate, employees do it differently - sometimes worse. So you take it back and do it yourself. This cycle keeps you trapped in operations forever.
π« The Delegation Trap
Common thought pattern:
- "It's faster if I just do it myself" (True today, but you'll do it 100 more times)
- "They'll mess it up" (Maybe, but they'll learn)
- "I'm the only one who can handle this customer" (Until you train someone)
- "If I delegate, what's my role?" (Building the business, not doing the work)
Result: You're working 70 hours/week while your team operates at 50% capacity because you won't let go.
The Delegation Ladder: What to Let Go First
You can't delegate everything at once. Follow this sequence to gradually remove yourself from operations:
Level 1: Routine Operational Tasks (Delegate First)
These are repetitive, process-driven tasks that don't require high-level judgment:
- Answering phones: Office admin handles scheduling, takes messages
- Equipment setup: Technicians set up jobs per documented procedures
- Data entry: Admin inputs job info into system
- Inventory management: Lead tech manages supply ordering
- Invoice processing: Bookkeeper handles bill payments
Delegate these immediately. They consume time but don't require your expertise.
Level 2: Technical Execution (Delegate Second)
Actual job performance - mitigation and reconstruction work:
- Running mitigation jobs: Lead tech runs water/fire jobs independently
- Reconstruction execution: Project manager oversees rebuild projects
- Quality control: Crew chief inspects work before customer walkthrough
- Customer communication: Techs handle on-site customer questions
Once you have trained leads, step out of field work completely. Trust your team's technical execution.
Level 3: Management Decisions (Delegate Third)
Day-to-day operational decisions:
- Job scheduling: Operations manager assigns jobs to crews
- Vendor selection: Project manager chooses subcontractors within guidelines
- Pricing approval: Estimator approves scope changes under $1,000
- Employee discipline: Manager handles first-level coaching and warnings
- Customer complaints: Operations manager resolves issues (escalates major ones)
Operations manager becomes your "mini CEO" - runs daily operations without your involvement.
Level 4: Strategic Decisions (Keep These)
High-impact decisions that shape the business:
- Major financial decisions: Large equipment purchases, facility leases, financing
- Key relationship management: Top insurance partners, major commercial accounts
- Hiring/firing managers: Building leadership team
- Strategic planning: Market expansion, service line additions, growth strategy
- Company vision & culture: Setting values and direction
This is YOUR role as owner. Strategy, not operations. 10-20 hours/week.
Creating Standard Operating Procedures (SOPs):
You can't delegate effectively without documentation. SOPs capture how to do tasks so anyone can follow them.
SOP Template Structure:
1. Purpose: Why this process exists
2. When to Use: Triggering conditions
3. Who's Responsible: Role that performs this
4. Step-by-Step Procedure: Numbered, detailed steps
5. Quality Standards: What "done right" looks like
6. Common Mistakes: What to avoid
7. Resources Needed: Tools, materials, forms
8. Related SOPs: Links to connected procedures
Example: Water Mitigation Response SOP
Purpose: Ensure consistent, professional response to water loss emergencies
Steps:
- Receive call from dispatch with address, contact, and loss type
- Call customer within 15 minutes to confirm ETA and gather additional info
- Arrive on-site within 90 minutes of dispatch (within service area)
- Introduce self, show ID, explain process to customer
- Walk property to assess damage extent and source
- Photograph affected areas before starting work (minimum 10 photos)
- Set up equipment per water loss equipment placement SOP
- Take and document initial moisture readings per moisture mapping SOP
- Explain drying process and timeline to customer (3-5 days typical)
- Complete job paperwork and obtain customer signature
- Enter job info in Job-Dox system before end of day
Decision-Making Authority Levels:
Define who can make what decisions without approval. This prevents bottlenecks where employees wait for you to approve everything.
Example Authority Matrix:
Technicians Can Decide:
- Equipment placement and setup
- Material usage under $50
- Customer questions about drying process
Lead Technicians Can Decide:
- All technician decisions PLUS:
- Crew assignments and schedules
- Material orders under $500
- Minor scope adjustments (add 1-2 air movers)
Operations Manager Can Decide:
- All lead decisions PLUS:
- Job pricing and estimates under $5,000
- Equipment purchases under $2,000
- Customer complaint resolution
- Employee discipline (verbal/written warnings)
- Emergency hiring decisions
Owner Must Approve:
- Equipment purchases over $2,000
- Employee terminations
- Major customer settlements over $5,000
- Contracts and agreements
- Strategic partnerships
Accountability & Reporting Systems:
Delegation doesn't mean abdication. You must have systems to monitor performance without micromanaging.
Weekly Reporting Requirements:
- Operations Manager Report: Jobs completed, revenue generated, customer satisfaction scores, team issues, upcoming week forecast
- Sales/Estimator Report: Leads generated, estimates submitted, close rate, pipeline value
- Office Manager Report: Receivables status, past-due accounts, insurance claim statuses
- Weekly Team Meeting: 30-60 minutes, review metrics, address issues, celebrate wins
Key Performance Indicators (KPIs) to Track:
- Revenue per Technician: Target $200K-$300K/year per field employee
- Job Completion Rate: Target 95%+ of jobs completed on time
- Customer Satisfaction: Target 4.5+ stars on reviews, 90%+ satisfaction surveys
- Estimate Close Rate: Target 50-70% of reconstruction estimates closing
- Employee Turnover: Target under 20% annual turnover
- Gross Profit Margin: Target 50%+ on all jobs
The Delegation Mindset Shift:
Letting go is uncomfortable. You'll watch employees do things differently than you would. That's okay. Perfect is the enemy of scale. Aim for 80-90% as good as you would do it - that's sustainable and allows growth. Your job is to build systems that work without you, not to be indispensable.
π Ready Pro Coaching: Systems Documentation
We'll help you create your complete Operations Manual with SOPs for every process. We provide templates, help you document workflows, and build authority matrices. Plus, we coach you through the emotional challenge of letting go.
Leadership Development: From Technician to Business Leader
The Identity Crisis of Business Growth:
You started your restoration business because you were good at restoration work. You were the best technician, could handle any loss, satisfied every customer. Now you have employees, and your job is no longer doing restoration - it's leading people who do restoration. This requires a completely different skill set, and most owners struggle with this transition.
π« The Technician-Turned-Owner Problem
You became a business owner because you were skilled at the craft. But business ownership requires:
- Vision: Seeing 3-5 years ahead, not just today's jobs
- People Skills: Motivating humans, not just managing projects
- Strategic Thinking: Systems and growth, not just execution
- Emotional Intelligence: Understanding team dynamics and psychology
- Letting Go: Accepting 90% execution vs your 100%
Many technically brilliant owners fail because they never develop leadership skills. You can't scale with technical skills alone.
The Mindset Shift: From Doer to Leader
Leadership starts with changing how you see your role:
OLD Mindset (Technician):
- β’ "I'm the best at this, so I should do it"
- β’ "If you want it done right, do it yourself"
- β’ Success = Getting all the work done
- β’ Value = My technical expertise
- β’ Control everything to ensure quality
NEW Mindset (Leader):
- β "My job is to develop people who are great at this"
- β "If I build the system right, others will do it well"
- β Success = Team achieving results without me
- β Value = Creating systems and developing people
- β Empower people with training and accountability
The Five Core Leadership Competencies:
1. Vision & Direction Setting
Leaders paint a picture of where the company is going and why it matters. Your team needs to understand the destination, not just today's tasks.
How to Develop This:
- Define your 3-year vision: Revenue goal, team size, services offered, market position. Write it down. Share it with team.
- Break it into annual goals: "This year we'll hit $2M revenue by adding 3 new crew members and launching reconstruction services"
- Connect daily work to vision: "Great job on that complex water loss - this is the quality that'll get us to market leader status"
- Monthly vision reminders: At team meetings, remind everyone where you're headed and why
Why it matters: People work harder when they're part of something bigger than just a job.
2. Communication & Feedback
Most owner-employee conflicts stem from poor communication. Clear, frequent, honest communication prevents 90% of problems.
Communication Framework:
- Daily Huddles (5-10 min): Quick morning standup - what's happening today, any issues, quick wins
- Weekly 1-on-1s: 15-30 min with each manager - review their week, address concerns, provide coaching
- Monthly Team Meetings: Company performance, celebrate wins, address issues, training topics
- Quarterly Reviews: Formal performance review with each employee - strengths, areas for growth, goals
Giving Effective Feedback (The SBI Model):
S - Situation: Describe the specific context
"During the water loss at 123 Main St yesterday..."
B - Behavior: Describe what you observed (facts, not judgments)
"You arrived 45 minutes after the scheduled time and didn't call the customer..."
I - Impact: Explain the consequences
"The customer was frustrated and posted a 1-star review. This damages our reputation and makes it harder to win future jobs."
This approach is clear, non-accusatory, and focuses on behavior rather than personality.
3. Conflict Resolution
Conflict is inevitable when you have a team. Avoiding it makes it worse. Great leaders address issues directly but respectfully.
The 5-Step Conflict Resolution Process:
- Address it quickly: Don't let issues fester. If two employees have tension, address it within 48 hours.
- Meet privately: Never address conflict publicly. Pull people into office/vehicle for private conversation.
- Listen to both sides: "Tell me your perspective" - let each person explain without interruption.
- Find common ground: "You both want the job done right and the customer happy, correct?" Establish shared goals.
- Create solution together: "How can we work together moving forward?" Let them propose solutions, you guide/approve.
Common Conflict Scenarios:
- Technician vs Technician: "He's not pulling his weight" - Address with both, set clear expectations, monitor
- Technician vs Office: "She doesn't understand field work" - Create job shadowing so office sees field reality
- Employee vs You: "You're being unfair" - Listen genuinely, explain your reasoning, be willing to adjust if they're right
Unresolved conflict destroys morale. Address it like you'd address water damage - immediately and completely.
4. Building Company Culture
Culture is "how we do things around here." It's set by what you tolerate, celebrate, and prioritize. Strong culture attracts and retains great people.
Defining Your Culture (Core Values):
Identify 3-5 values that define your company. These should be:
- Authentic (actually how you operate, not aspirational)
- Memorable (short phrases people can remember)
- Actionable (guide decision-making)
Example Core Values - Restoration Company:
- 1. Customer First: We treat every home like it's our own
- 2. Own It: Take responsibility, fix problems, no excuses
- 3. Grow Together: We invest in developing our team
- 4. Do It Right: Quality over speed, every time
- 5. Have Fun: Work hard, celebrate wins, support each other
Reinforcing Culture:
- Hire for culture fit: Interview question: "Tell me about a time you went above and beyond for a customer"
- Celebrate values in action: "Shout out to Mike for owning that mistake and fixing it immediately - that's Our Value #2"
- Fire for culture violations: If someone consistently violates values, they don't stay even if technically competent
- Model it yourself: You can't demand integrity while cutting corners. You set the standard.
Strong culture reduces turnover by 30-40%. People stay where they feel valued and aligned.
5. Motivating & Retaining Top Performers
Your best employees have options. They'll leave if not engaged. Money matters, but it's not the only motivator.
What Actually Motivates Employees (Research-Backed):
- Autonomy: Ability to make decisions and control their work. Let experienced techs run jobs their way (within quality standards).
- Mastery: Opportunity to get better at their craft. Provide training, certifications, skill development.
- Purpose: Feeling their work matters. "You're helping families recover from disasters" is more motivating than "set up equipment."
- Recognition: Acknowledgment of good work. Public praise in team meetings, employee of month, bonuses for great reviews.
- Growth Path: Clear trajectory for advancement. "If you get IICRC certified and perform well, you'll be Lead Tech with $5K raise."
- Fair Compensation: Paid competitively for market. Not necessarily highest, but not lowest either.
Retention Strategies That Work:
- Stay Interviews: Before they consider leaving, ask "What would make you even more excited to work here?"
- Anniversary Bonuses: $500-$1000 cash bonus at 1/3/5 year marks. Shows you value loyalty.
- Profit Sharing: 5-10% of quarterly profit distributed to team. They win when company wins.
- Flexibility: Top performers who want Fridays off or adjusted schedules - accommodate when possible.
- Investment in Development: Pay for certifications, training, conferences. Shows you're invested in their future.
- Exit Interviews: When someone leaves, genuinely ask why and learn from it.
Replacing a trained employee costs $15,000-$30,000. Retention investments pay for themselves many times over.
The Leadership Development Path:
Leadership skills don't appear overnight. Here's how to develop them systematically:
12-Month Leadership Development Plan:
Months 1-3: Communication Foundations
- Implement weekly 1-on-1s with all direct reports
- Practice SBI feedback model with every correction
- Read: "Crucial Conversations" by Patterson
- Start monthly team meetings
Months 4-6: Delegation & Systems
- Document 5 key processes as SOPs
- Delegate 3 major responsibilities to team members
- Read: "The E-Myth Revisited" by Gerber
- Create authority matrix for decision-making
Months 7-9: Culture Building
- Define and publish company core values
- Implement employee recognition program
- Read: "The Culture Code" by Coyle
- Survey team about culture and morale
Months 10-12: Strategic Leadership
- Create 3-year vision document
- Develop succession plans for key roles
- Read: "Traction" by Wickman (EOS system)
- Work with Ready Pro Coaching on advanced leadership topics
Leadership Challenges You'll Face:
Challenge: "I'm not a natural leader"
Reality: Leadership is learned, not innate. Every skill in this module can be developed through practice. Start with communication - master 1-on-1s and feedback.
Challenge: "People don't respond to feedback"
Reality: They respond to how feedback is delivered. Use SBI model, be specific, show you care about their success. If they still don't respond, that's a fit issue.
Challenge: "I don't have time for all these meetings"
Reality: You don't have time NOT to. 30 minutes of 1-on-1 prevents 3 hours of problems. Strategic time investment, not wasted time.
Challenge: "My team doesn't care like I do"
Reality: They won't care as much (it's not their business). But they'll care MORE if you connect their work to purpose, give autonomy, and recognize effort.
The Leadership Truth:
Every problem in your business is either a leadership problem or a systems problem. Team not performing? You haven't set clear expectations or provided proper training (leadership). Jobs not profitable? You haven't built proper estimating and cost-tracking systems. When you blame your team, look in the mirror first. Great leaders create environments where average people achieve exceptional results.
π― Ready Pro Coaching: Leadership Development
We provide ongoing leadership coaching, help you navigate difficult conversations, role-play challenging scenarios, and give real-time feedback on your management approach. Leadership is best learned through practice with an experienced coach - that's what we provide.
Your Team Scaling Roadmap
Building a scalable restoration business requires systematic execution across all six modules. This isn't theory - it's the proven playbook used by successful restoration companies nationwide.
Implementation Sequence
- Year 1: Hire first admin and tech, document 10 core SOPs, implement basic training
- Year 2: Hire operations manager, build 30/60/90 onboarding, establish culture
- Year 3: Complete delegation, develop leadership skills, scale to $2M+
- Year 4-5: Refine systems, build depth, prepare for exit or passive ownership
Success Metrics
- β Owner working 20 hours/week or less on strategy only
- β Business operates profitably for 30+ days without owner
- β Management team capable of running all operations
- β Employee turnover under 20% annually
- β Customer satisfaction 4.5+ stars consistently
- β 50%+ gross margins maintained across all jobs
"The best CEOs are the ones the company doesn't need."
Build your business to work without you, then choose how you want to be involved
Exit Strategy & Sale Preparation
Build a business that can be sold for maximum value or run passively without you. Learn business valuation, buyer psychology, due diligence preparation, and transition strategies that create generational wealth.
Ready Pro Coaching: Your Exit Planning Team
Exit planning isn't something you do the year before you sell - it's a multi-year process that maximizes your business value. Ready Pro Coaching provides the strategic guidance to position your business for a premium sale or passive ownership.
What Exit Strategy Coaching Includes:
- β Business Valuation Analysis: We assess your current business value and identify gaps to increase it
- β 2-5 Year Exit Roadmap: Custom timeline with specific milestones to prepare for sale or passive ownership
- β Financial Optimization: Restructure finances to maximize EBITDA and appeal to buyers
- β Operations Manual Development: Document all systems so business runs without you
- β Buyer Network Access: Introductions to acquisition firms, private equity, and strategic buyers
- β Sale Negotiation Guidance: Review offers, structure deals, maximize after-tax proceeds
The difference between a $500K sale and a $2M sale is preparation. Work with our team to build a business that commands premium valuations and attracts serious buyers. Whether you're selling in 2 years or 10 years, start preparation now.
Understanding Business Valuation: What Determines Your Business Worth
How Restoration Businesses Are Valued:
Unlike residential real estate (which has comparable sales), businesses are valued based on their financial performance and future earning potential. The most common method is a multiple of earnings.
The EBITDA Multiple Formula
Business Value = EBITDA Γ Multiple
EBITDA = Earnings Before Interest, Taxes, Depreciation, and Amortization
(Essentially your operating profit before accounting adjustments)
Multiple = How many times your annual profit a buyer will pay (typically 2-5x for restoration businesses)
Example Valuation:
$2M annual revenue, $400K EBITDA (20% margin)
Multiple: 3x (average for restoration)
Business Value = $400K Γ 3 = $1.2M
What Determines Your Multiple:
- Business Model: Owner-operated businesses get 0-1.5x. Businesses with management teams get 3-5x. The less the business needs you, the higher the multiple.
- Revenue Stability: Predictable, recurring revenue commands higher multiples than unpredictable emergency work. Commercial contracts and insurance partnerships increase multiples.
- Growth Trajectory: Businesses growing 15-25% annually get premium multiples. Flat or declining revenue gets discounts.
- Customer Concentration: If 30%+ revenue comes from 1-2 customers, multiple drops. Diversified customer base increases value.
- Systems & Documentation: Businesses with documented SOPs, training manuals, and operational systems get higher multiples. Buyers pay for transferable business models.
- Financial Clarity: Clean books, detailed P&Ls, and professional accounting increase buyer confidence and multiples. Messy finances destroy value.
- Team Quality: Experienced management team that will stay through transition increases multiples significantly. Key person dependency (you) decreases value.
- Market Position: Market leaders with strong reputations command premiums. Generic "me-too" businesses get lower multiples.
Typical Restoration Business Multiples:
0-1.5x EBITDA: Owner-Operator Model
Owner works 60+ hours/week in operations. No management team. Inconsistent financials. Business can't run without owner. Limited buyer interest.
2-3x EBITDA: Working Owner with Team
Owner involved but has some delegation. Basic systems in place. Stable revenue. Some documentation. Moderate buyer interest from individuals or small PE.
3-5x EBITDA: Absentee Owner / Turnkey Business
Management team runs operations. Owner is strategic only. Complete systems documentation. Growing revenue. Strong buyer interest from PE firms and strategic acquirers. Premium valuations.
Real-World Valuation Examples:
Business A: Owner-Operator
- $1.5M revenue, $300K EBITDA
- Owner does estimates, sales, and sometimes jobs
- 3 employees but all need owner supervision
- No operations manual, systems in owner's head
- Multiple: 1x
- Valuation: $300K (barely sells)
Business B: Turnkey Operation
- $2.5M revenue, $500K EBITDA
- Operations Manager runs day-to-day
- 12 employees, documented hiring/training systems
- Complete operations manual, SOPs for all processes
- Growing 20% YoY
- Multiple: 4x
- Valuation: $2M (multiple offers)
The Harsh Truth:
Most restoration business owners work for 10-20 years building a business that's worth almost nothing when they try to sell. Why? Because they built a job, not a business. Buyers don't want to buy your job - they want to buy a system that produces profit without them working in it. Start building for exit from Day 1.
π‘ Value Creation Action Steps
Every system you document, every person you train to work independently, and every month of growing EBITDA increases your business value. Work with Ready Pro Coaching to create a specific value-building roadmap.
Sale Preparation: Building a Business Buyers Want
The 2-5 Year Preparation Timeline:
You don't prepare to sell 6 months before listing your business. Professional exit planning takes 2-5 years to maximize value. Here's the roadmap:
Years 5-3 Before Sale: Foundation Building
- Hire and train operations manager to run daily operations
- Document all processes in operations manual
- Build recurring revenue sources (commercial accounts, insurance partnerships)
- Implement formal financial reporting (monthly P&L, balance sheets, cash flow statements)
- Create organizational structure with clear roles and responsibilities
- Begin tracking KPIs and business metrics
Years 3-2 Before Sale: Value Optimization
- Reduce owner involvement to strategic oversight only
- Focus on profit margin improvement (target 15-25% EBITDA)
- Eliminate customer concentration (no customer >15% of revenue)
- Clean up financials - separate personal and business expenses completely
- Build management team depth (multiple people who can run operations)
- Create growth initiatives that show upward revenue trajectory
- Address any legal/compliance issues (licenses, insurance, contracts)
Years 2-1 Before Sale: Market Preparation
- Conduct formal business valuation with professional advisor
- Prepare "Confidential Information Memorandum" (CIM) - the sales package
- Organize due diligence documents (3+ years financials, customer contracts, employee records)
- Strengthen management team retention with incentives/equity
- Negotiate key employee stay agreements for post-sale transition
- Identify and fix any red flags buyers will discover
- Engage business broker or M&A advisor
Year of Sale: Transaction Process
- Market business to qualified buyers
- Field initial offers and negotiate Letter of Intent (LOI)
- Buyer conducts due diligence (60-90 days of intense scrutiny)
- Finalize purchase agreement and deal structure
- Close transaction and fund escrow
- Begin transition period (typically 3-12 months helping new owner)
Critical Sale Preparation Elements:
1. Financial Cleanliness
Buyers scrutinize your numbers intensely. Sloppy financials kill deals:
- Three years of professional financial statements (P&L, balance sheet, cash flow)
- Clear separation of business and personal expenses
- Tax returns that match financial statements
- Documented add-backs (owner salary above market, personal expenses, one-time costs)
- Consistent accounting methods and software
2. Operations Manual / System Documentation
This is your business's instruction manual. Without it, buyers assume chaos:
- Emergency response procedures
- Job workflow from call to completion
- Estimating and pricing standards
- Quality control checklists
- Customer service protocols
- Hiring, training, and termination procedures
- Equipment maintenance schedules
- Insurance claim processing
3. Customer Contracts & Relationships
Prove your revenue will continue after you're gone:
- Written agreements with preferred vendors/insurance companies
- Commercial contracts with property managers/HOAs
- Customer list with contact info and revenue history
- Referral source documentation
- Marketing materials and brand assets
4. Team Stability & Retention
Buyers fear losing key employees post-sale:
- Management team with documented responsibilities
- Stay bonuses for key employees through transition
- Employee handbook and HR documentation
- Low turnover history (shows culture and stability)
- Succession plan for each role
Red Flags That Kill Deals:
- Owner does all sales/estimates/customer relationships
- Financial statements don't match tax returns
- Significant customer concentration (one client is 30%+ of revenue)
- Declining revenue or margins over past 2 years
- Legal issues (lawsuits, liens, license problems)
- Key employees not under contract or planning to leave
- Poor online reputation or customer reviews
- Outdated or broken equipment
Exit Options: Ways to Extract Value From Your Business
Four Primary Exit Strategies:
Option 1: Full Sale to Third Party
How It Works: Sell 100% of business to buyer (individual, competitor, or private equity). Buyer pays cash and/or financing. You exit completely or stay for transition period.
Pros:
- Complete exit - full cash out
- Fastest path to liquidity
- No ongoing responsibility after transition
- Highest multiples if business is well-positioned
Cons:
- All-or-nothing - must be ready to leave
- Capital gains tax on full amount
- Buyer may change/damage business you built
Best For: Owners ready to fully retire or start new venture
Option 2: Management Buyout / Internal Sale
How It Works: Sell to your operations manager or management team over time (3-7 years). Often seller-financed with monthly payments from business cash flow.
Pros:
- Preserve company culture and team
- Buyer already knows the business
- Can structure tax-efficient transition
- Maintain some involvement/income during transition
Cons:
- Lower multiple (usually 2-3x vs 3-5x)
- Paid over many years, not immediately
- Risk if new owner can't run business profitably
Best For: Owners who want gradual transition and care about legacy
Option 3: Partial Sale / Equity Partner
How It Works: Sell 30-70% to investor/partner while retaining ownership stake. Partner brings capital, expertise, and often drives growth for larger future exit.
Pros:
- Get liquidity now while keeping upside potential
- Partner helps scale business for bigger exit later
- Can "sell twice" - partial now, remainder at higher value later
- Access to partner's resources and expertise
Cons:
- No longer sole decision maker
- Must agree on strategy with partner
- Growth pressure to hit partner's return targets
Best For: Owners who want liquidity but aren't ready to fully exit
Option 4: Convert to Passive Income (No Sale)
How It Works: Build management team that runs business without you. Take owner distributions while business operates independently. Never sell, pass to heirs, or sell later at your discretion.
Pros:
- Ongoing cash flow for life
- Keep ownership and control
- Can pass to family
- No capital gains tax
- Asset that produces passive income
Cons:
- No big liquidity event
- Responsible for business performance
- Must maintain management team
- Value trapped in business (not diversified)
Best For: Owners who want freedom without selling, or plan to pass to next generation
Choosing Your Exit Path:
The right exit depends on your goals, timeline, and personal situation. Ready Pro Coaching helps you evaluate options and choose the path that maximizes YOUR definition of success - whether that's maximum cash, preservation of legacy, gradual transition, or passive income.
Key Questions to Consider:
- What's your target retirement age and timeline?
- How much money do you need from exit?
- Do you want complete exit or stay involved?
- Do you care what happens to the business after you're gone?
- Are there family members who want to take over?
- Is your management team capable of buying/running it?
- What's your comfort level with selling/transition process?
Building an Exit-Ready Business
Whether you're selling next year or in 10 years, every decision you make today affects your exit value tomorrow. Build your business with the end in mind.
Exit-Ready Characteristics
- β Business operates without owner (10-20 hrs/week owner time)
- β Strong management team in place
- β All systems documented in operations manual
- β 15-25% EBITDA margin
- β Growing revenue trajectory (15%+ YoY)
- β Clean financials with 3+ years history
- β Diversified customer base
- β Valuable 3-5x EBITDA multiple
Ready Pro Coaching Deliverables
- β Current business valuation assessment
- β Custom 2-5 year exit roadmap
- β Value gap analysis and improvement plan
- β Operations manual template and development
- β Financial optimization strategy
- β Management team development plan
- β Buyer network introductions
- β Transaction guidance and negotiation support
"The best time to prepare for exit was 5 years ago. The second best time is today."
Schedule your exit planning session with our team