Restoration Rewind Delta Development Group Monthly Newsletter
September 2013
Delta Disaster Services of Northern Colorado had a very quick entry into the disaster restoration business. Within 24 hours of completing their 2 week franchise training and taking their final test, they had a major hail event in their market area.
The Northern Colorado crew had not even received all of their equipment when their first emergency call came in. Fortunately, Delta Disaster Services of Denver was able to assist them with equipment and manpower so they could properly address the jobs that came their way.
Delta Disaster Services of Denver’s in the National Spotlight again!
Congratulations Michael!
On behalf of the entire staff at Qualified Remodeler, we are pleased to inform you of your firm’s acceptance into the 2013 Qualified Remodeler Top 500. We have mailed your firm a congratulatory announcement, suitable for framing, which lists your national rank. Be sure to review our August issue, which features the Top 500 list. Sincerely,
Rob Heselbarth Editorial Director
Marketing News
When Delta Development Group determined it was going to franchise its business model, we knew we needed to find the best of the best. Meaning that in each market area, we were looking for people that have established business relations, a high reputation of integrity and an impeccable personal value system. You can use these traits and a few others to competitively sell your business to your
market area. A competitive analysis has been done in each Delta Disaster Services market area, and they all reveal most of the same results. They show that many of the other companies in the industry, in the various markets, do not match up to the Delta level of business. Most of our competitors have not been long-standing contractors. Most of them were not even professionals in the home service industry, let alone restoration contractors. The other thing to note is that many of them have never been in business for themselves. Most of them had desk jobs and then wanted to become entrepreneurs. The Delta business model is built by an entrepreneur with entrepreneurs in mind. In our research we have found that most of our competitors are structured for quick growth and very little else, success with them is truly hit or miss. More and more you will find that many people in your market area do not match up to your business and while they might be labeled as such, most of our competition are not actually competition at all. Use these positive notes as great marketing tools for your business. Sell your experience in the construction industry. Sell your entrepreneurial motivation. Sell your owner’s background. Sell your restoration knowledge. As a member of the Delta network, you have a lot of attributes on your side, use them to help you grow.
Technical News Equipment Profile: Rescue Mat System – For drying out hardwood floors. Included in our the initial equipment package are pieces of equipment that allow the capability to dry out hardwood floors, including High Temperature Dehumidifiers as well as an E-Tes unit.
The Rescue Mat System pictured above uses the power of a high-pressure blower, like the DriForce, to vacuum water right through the surface of the floor. There are two different sizes available, making it easy to custom fit your Rescue Mat System to any floor layout.
Delta Disaster Services of Denver recently took on a large fire loss of its own. We will track the progress of this job over its lifetime to show you what a large loss such as this entails. The date of loss for the job was August 20, 2013. Currently a contents adjuster is on site to address all the contents. (Everything is totaled), before we can move into demolition. Next week Delta Disaster Services of Denver will begin lining up the subcontractors to address the necessary trade issues that will be needed for this reconstruction. We are awaiting the insurance adjuster’s engineering report so that we can begin to write our estimate Additionally, what makes this particular fire loss significant to us is the amount of time it took to obtain and nurture the account. We picked up this referral source approximately 3 years ago. They started off assigning us smaller jobs which have incrementally gotten larger throughout our relationship. This particular fire is the first true “large Loss� that we have received from this particular referral source. It is safe to say that one our long-standing competitors has encountered problems and this certain referral source now wants Delta to step up.
Florida Supreme Court Rules That General Contractors are Entitled to Overhead and Profit. A ruling published by the Supreme Court of Florida earlier this month held that general contractors are entitled to overhead and profit charges under a replacement cost homeowner’s policy. In Trinidad v. Florida Peninsula insurance Company, the Supreme Court said, "...we hold that an insurer's required payment under a replacement cost policy includes overhead and profit, where the insured is reasonably likely to need a general contractor for the repairs, because the insured would be required to pay costs for a general contractor's overhead and profit for the completion of repairs in the same way the insured would have to pay other replacement costs he or she is reasonably likely to incur in repairing the property..." "Trinidad is clearly a step in the right direction for the restoration industry and homeowners in Florida," said Paul T. Zeniewicz, Esq., an attorney for Cohen Battisti - Attorneys at Law. "The opinion affirms that overhead and profit are included in a covered loss when the homeowner is reasonably likely to need a general contractor for repairs. The impact of this decision negates the prevailing opinion that incorrectly implied that overhead and profit were only recoverable when a general contractor employed three separate and distinct trades. In short, the decision simply reinforces what we already knew... that contractors and vendors should be able to recover for overhead and profit costs under a replacement value policy. We look
forward to using the Trinidad opinion to bolster our position moving forward." The ruling also clearly outlines what is considered overhead and profit. "Specifically, overhead includes 'fixed costs to run the contractor's business, such as salaries, rent, utilities, and licenses,' and profit 'is the amount the contractor expects to earn for his services.'" In addition, the ruling goes on to say that "because replacement cost insurance provides coverage based on the cost to repair or replace the damaged structure on the same premises, we conclude that overhead and profit necessarily must be included within the scope of a replacement cost policy where it is reasonably likely a general contractor would be needed for the repairs. Accordingly, overhead and profit are a necessary component of replacement costs, just as they are for actual cash value, because replacement cost insurance is intended to compensate the insured for what it would cost to repair or replace the damaged property. Thus, we conclude that overhead and profit are included in the replacement cost of a covered loss when the insured is reasonably likely to need a general contractor for the repairs."
Reaction from those in the restoration industry was extremely positive. "FINALLY!! For those of us restoration contractors who are general contractors, we finally have a response to the inexperienced adjuster who says 'we don't pay overhead and profit.' The answer is the "law" entitles us to it."
Delta News Delta Development Group is pleased to announce that we have taken an area hold agreement for the Eastern Pennsylvania franchise market. Our newest franchisees are well-established remodelers and bring a tremendous amount of expertise and credibility to our system. We expect to finalize contracts by the end of September to have our new franchisees in our October training class. The owners of this franchise are Faith and Erik Bones. We will have much more to share in next month’s newsletter.
Employers face mold problems By Stephanie Armour, USA TODAY
After moving into a new office building in New Orleans, Sherry Watters and her co-workers began complaining of odd ailments. Rashes. Runny noses. Breathing problems so severe that some employees carted oxygen to meetings. Watters never thought leaking water from roofs, pipes and other sources was to blame for her headaches and the other complaints. But now the lawyer at the Louisiana Department of Social Services is convinced that water damage caused a toxic mold infestation that sickened hundreds of staffers. "We could see the mold, the big black spots on the ceiling," says Watters, 45, who was relocated this year along with other employees from the Plaza Tower office building. "It was in the vents, the air ducts. We just wanted a safe and healthy work environment. It was scary." Already a costly hazard for homeowners, mold is fast becoming a pressing legal and health problem for employers as well. Mold has shuttered public school buildings and hospital wings, prompted employers to scramble for alternative work sites, and left contractors paying multimillion-dollar jury awards. Employees are filing lawsuits about health problems they say were caused by mold. They're refusing to work in buildings they suspect are infested. And in some cases, companies are spending millions of dollars on environmental tests, new office buildings and remediation efforts after workers complain. Thousands of lawsuits have
been filed in the past decade, and many of the largest settlements and jury awards involve commercial buildings. No employer is immune: In July, Hilton Hotels closed part of a facility in Hawaii after mold was found by a cleaning attendant. Guests were relocated, and a search is now on for the cause of the moisture. It's an increasingly familiar story. Other organizations, such as medical centers, elementary schools, hotels, day care centers, publishers and government agencies have grappled with mold problems in the past few years. Employees say they've experienced memory problems, bloody urine, rashes, suppressed immunity, canker sores, spontaneous nose bleeds and respiratory ailments so severe that they've led to hospitalizations. Lawsuits can come with staggering price tags. After Santa Clara County temporarily closed its courthouse in San Martin, Calif., because of mold, they sued the general contractor, architect and others for alleged building deficiencies. The case was settled last year for $12 million. "The average owner of a building, rather than trying to do what's right, tries to cover it up," says Madro Bandaries, a lawyer at Gretna, La.-based Amato & Creely, which is handling several cases involving mold in the workplace. "The buildings become petri dishes for mold. This is an issue employers are going to have to deal with.
Finance How do you eat an elephant…one bite at a time. Sometimes looking at the overall financial objective of the company can be overwhelming. We have always believed that you need to break your numbers down into monthly, weekly, daily, and even hourly increments. This is important, it gives you a good sight on what your financial goals are on an achievable and measurable level. So let's say that your company's objective this year is to do $1 million in gross sales. We know if the million dollars is broken down by 12 months, my objective becomes $83,333.33 per month. If you further breakdown the objective into a weekly goal, the objective then becomes $19,841.25. At Delta Disaster Services of Denver we track all of our production on a weekly basis. Meaning that at the end of every week, Michael Mastous is given an update on all production by division versus what our monthly goal is. This information is also shared with all other supervisors and managers in the company late on Friday afternoons. Denver has also been known to take the numbers and break them down even further. In the example above, we would also look at what our daily production objective is, as well as hourly. So in this scenario, in order to reach $1 million in sales for the year, we need to do $2,739.72 per day or $342.46 amount per hour, (assuming it's an eight hour day, right)
We will leave you with this…
“Some people dream of great accomplishments, while others stay awake and do them”. Danielle Luedtke