Reconsruction division

[Greg Cole]

I took over the overhaul of our reconstruction department effective two weeks ago.
Oddly enough, I know more about brain surgery than I do reconstruction......
It's been one hell of an education. I'm enjoying the hell out of it!
Can't say that the managers are enjoying me breathing down their neck though! lol
Anyone else doing recon?

 

[Desk Jockey]

We are asked often but it seems so problematic that we've avoided it entirely.

We definitely pass up tons of potential work but so far we are mitigation only.

In, out and bill it.

 

[Greg Cole]

We are asked often but it seems so problematic that we've avoided it entirely.
We definitely pass up tons of potential work but so far we are mitigation only.
In, out and bill it.

We signed $182,000 in reconstruction since September 21st. Have another $200k in the approval stage with insurance. Definitely a headache if not managed correctly. I've gotten involved personally in order to spearhead this and provide the systems needed to run more smoothly.

 

[Desk Jockey]

I went to a NIDR bidding & pricing class in Reno 10-12 years ago. Martin King was the presenter (RIP) and as I signed in I few like I was in the wrong place. Heavy hitter were everywhere, company's had 4-6 estimators there wearing company colored blazers. Everyone getting donuts & coffee talking about how many 10's of millions they were doing.

Those guys are light years from us.

Any way as the class progressed Martin started exposing profit margins for average reconstruction companies.
He pounded away at how many that were doing 5-6 million or more were actually taking on work to stay busy but profit was reaching a point of diminishing returns. Told them that if they were smart they would quit subbing out the mitigation and bring all that and contents cleaning in house. He told them the real money is in that portion of the business.He said 1.6-2 million was the sweet spot at the time. Any more than that and you are not making what you should for the risk.

At lunch all those guys that had snubbed me at registration, became my instant best friends.

They quizzed me on everything from how we operated and what we used and how we priced everything. Hell I thought I was there counselor. They spilled the beans how they struggled to make good money for the exposure they were taking



As I said that was more than a decade ago, prior to preferred vendor programs and third party evaluators.

Good luck at least you have the tenacity for it! I don't care for the additional headaches.

Me...fookem, I'm in, I'm out and on down the road!

 

[Greg Cole]

I went to a NIDR bidding & pricing class in Reno 10-12 years ago. Martin King was the presenter (RIP) and as I signed in I few like I was in the wrong place. Heavy hitter were everywhere, company's had 4-6 estimators there wearing company colored blazers. Everyone getting donuts & coffee talking about how many 10's of millions they were doing.
Those guys are light years from us.
Any way as the class progressed Martin started exposing profit margins for average reconstruction companies.
He pounded away at how many that were doing 5-6 million or more were actually taking on work to stay busy but profit was reaching a point of diminishing returns. Told them that if they were smart they would quit subbing out the mitigation and bring all that and contents cleaning in house. He told them the real money is in that portion of the business.He said 1.6-2 million was the sweet spot at the time. Any more than that and you are not making what you should for the risk.
At lunch all those guys that had snubbed me at registration, became my instant best friends.
They quizzed me on everything from how we operated and what we used and how we priced everything. Hell I thought I was there counselor. They spilled the beans how they struggled to make good money for the exposure they were taking
As I said that was more than a decade ago, prior to preferred vendor programs and third party evaluators.
Good luck at least you have the tenacity for it! I don't care for the additional headaches.
Me...fookem, I'm in, I'm out and on down the road!

Yeah- the profit margins are less than miti for sure. If the volume is there- it can be profitable. My goal is to have a miti, packout, and a recon division all running at profit.

 

[Desk Jockey]

Yeah- the profit margins are less than miti for sure. If the volume is there- it can be profitable. My goal is to have a miti, packout, and a recon division all running at profit.

Not trying to be a dick about it (that comes natural ), its just not us.

I think you can do it because you have the management skills to do it better than the average guy could or would.

 

[Jeremy N]

I took over the overhaul of our reconstruction department effective two weeks ago.
Oddly enough, I know more about brain surgery than I do reconstruction......
It's been one hell of an education. I'm enjoying the hell out of it!
Can't say that the managers are enjoying me breathing down their neck though! lol
Anyone else doing recon?

We do a bunch of it. It can be tiring. It takes a bunch of focus and attention. Proper management is the key. Being in someone's house that much longer is more time for potential problems and customer satisfaction. Watch out for crazy, emotional, controlling woman. Life can get miserable quickly in that situation.

 

[Nate The Great]

We do a bunch of it. It can be tiring. It takes a bunch of focus and attention. Proper management is the key. Being in someone's house that much longer is more time for potential problems and customer satisfaction. Watch out for crazy, emotional, controlling woman. Life can get miserable quickly in that situation.

You know my gf too? FML!!

Me...fookem, I'm in, I'm out and on down the road!

Me too..... Or well I used to be.......

I agree though, Recon isn't all that great when you start getting down to the nitty gritty....

 

[Desk Jockey]

Me too..... Or well I used to be.......

You're a baad man...very baad!

 

[Hoody]

Agree with all the comments about recon - like Richard we did a lot to try and save as much as possible to limit the amount of recon needing to be done. The good news is, companies that do the work have a wide range of talent and skill to pick from. There are a lot of finish carpenters that will take work for 10-15 an hour to hang, tape, mud drywall, and nail up new trim and baseboards. If you are actually hiring these people and don't have the volume it becomes challenging because then they want to be independent contractors or will look for side work.

I was watching Undercover Boss one night and the Belfor episode was on. Even a company that large has struggles of keeping their recon guys busy where they aren't tempted to take side work. We did recon but we also started a separate contracting division that also did other things such as siding, roofing, additions, windows, etc. Even though we had a good deal of volume of work, it was still tough to keep them busy unless we sold the additional services a traditional contracting company offers.

Standing in the kitchen picking out color palettes to match the new furniture and flooring they were getting . Needless to say I became friends with an interior designer that could teach me some of that stuff to make it easier.