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Catastrophe RestorationManaging Your Restoration Business

CAT Claims: Join the Circus, or Stay Home

Part 1 of 3-part catastrophe claims series.

By Les Cunningham
CAT Claims: Join the Circus, or Stay Home
February 8, 2018

Let’s talk about what you need to know in order to decide whether or not you and your company are up to leaving home plate to work a CAT storm outside of your normal work area. There are a lot of questions that only you and your team can answer, whether they are staying at home base or traveling. It will pay you to involve all of your team members in this discussion. It will also pay to have a company meeting. Invite your team and their families to attend to discuss what, why, and when things will be happening. In a nutshell, tell them the current plan. Emphasize that change will happen and all of us will need to adjust to the changes as they happen. Tell them you will keep them in the communication loop as soon as you know what is going to happen. If you do not do this, they will be listening through the “company grape vine”, and you may not like the results of what happens.

CAT Losses

The other thing you have to be keenly aware of is that generally in a busier than normal time, you work harder for less profit.

The Traveling Circus

One of my clients described a CAT effort as a lot like owning and operating a traveling circus. The CAT effort will place a large amount of stress on the families of everyone in the company. This is true whether or not they stay and continue to work locally or leave home and travel to a CAT. Both the home base office and the temporary CAT office are going to require each other’s help on an ongoing basis. This will come at a time of not having enough trained people to run either office properly. A lot of companies think that hiring temporary help will resolve the issues. Hiring temporary workers actually throws gasoline on the fire for a time. The existing staff is going to be understaffed, stressed and now they have to put in additional time to train temps for company specific needs. This comes at a time when they are feeling that they don’t have enough time to do their normal job! This will stress the company performance and add stress to their home life. This is a spot where lack of training for a CAT really shows up. Working away from home isn’t going to work like it does at home. It’s going to be much more difficult to get good help, much less experienced help. One of the many reasons is that everyone in the area is really busy trying to keep up with their own stuff, let alone having time to help someone else. The conclusion might be that you need to both train and prepare for a CAT before a CAT exists. Most companies don’t train enough, plan enough for future activities nor budget both money and time for this activity. Most companies train technicians, but not sales people, administration people or the rest of the people in production, besides technicians.

The other thing you have to be keenly aware of is that generally in a busier than normal time, you work harder for less profit. Usually I get push back on this statement. It’s ok if you do not believe me, so ask a company who has worked a CAT and they will tell you how EASY it is to lose money on a CAT.

One of the clearest answers that I have ever received on this subject was the following explanation. When I asked if his companies CAT effort was profitable, his response was: “Well….it depends….on whether or not my invoices get paid.” A lot of companies do not realize that doing the work does not mean you will get paid for doing the work.

Wishing you good judgment and profitable efforts as to whether or not you decide to chase a storm!  

KEYWORDS: CAT loss disaster restoration flood damage restoration hurricane damage restoration wildfire damage restoration

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Les Cunningham, CGC,CR,CCR,CGRa, is president and CEO of Business Networks, Inc. He is a restoration industry expert and can be reached at 1-800-525-1009, ext. 14 or e-mail him at Les@BusinessNetworks.com

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