Sunday 3 May 2020

How Much Money Can a Restoration Company Startup Make?

Posted by at 9:02 AM in

How Much Money Can a Restoration Company Startup Make?

Consider these numbers.

Mitigation jobs in the US average $3,500 and rebuild (you have to put back any build materials you take out due to damage) is $12,000.

If you got one mitigation customer a week for 52 weeks, that would produce $182,000 of annual mitigation income. This is not a particularly stellar outcome!

52 rebuilds at $12,000 produce $624,000 of income. Providing full-service (mitigation and rebuild) produces $906,000 of annual income from only one job a week. Every company owner expects to get many more jobs than one per week.

The expected profit margins for mitigation work is 75% and for the rebuild is 50%. If a company performed 52 mitigation jobs in a year, $135,000 of profit would be generated. This would be enough for a single owner operator to live on, but not much leftover to grow the business. Many mitigation-only startups struggle to gain a toe hold in their community because the revenue and net profit margins are so meager, especially in the early years of operation.

If a full-service company completed 52 jobs in the first year, it would produce $906,000 in revenue and $450,000 in profit. One can provide for a family and grow the business with this level of revenue and profit.

I have personally coached many restoration startup companies who have earned $750,000 - $1,000,000 of revenue in their first 12 months.

If you are considering starting a restoration business, I commend you! It is a wonderful recession-proof industry, and I highly recommend it to you.

With equal passion and enthusiasm, I encourage you to begin as a full-service contractor providing both mitigation and rebuild services.

Below are the postings of the How to Start a Restoration Company Series. I hope together they will answer most of the critical questions you have. Afterward – give me a call, and let's talk about how to put it all together! Click on the title to view.

For more information or help to start your restoration business contact me at https://www.growmyrestorationbusiness.com/contact-us