CATx Blueprint Vol. 006 | 10 Things To Know Before You Start Commercial Restoration

Entering the commercial restoration space can be highly profitable, but it also comes with major challenges that many contractors don’t anticipate. It’s not just bigger projects—it’s a different game entirely.

Before you dive in, here are 10 critical things you need to know so you can start strong, avoid costly mistakes, and position yourself for success.

1. Commercial ≠ Large Loss

Many people assume commercial restoration only means massive projects—that’s not true.

🏢 Commercial just means working on business properties instead of homes.

📦 It can be small jobs—office floods, restaurant fires, or apartment water damage.

⚡ Starting small is smarter than jumping straight into multi-million-dollar losses.

✅ Takeaway: You don’t need to land a huge project to get started. Focus on small commercial jobs first, then scale up.

3. Commercial Clients Care About Business Continuity, Not Just Cleanup

Unlike homeowners, commercial property owners and managers don’t just want their building restored—they want to stay operational during the process.

🚨 Business downtime = lost revenue.

🚨 Lost revenue = angry owners, lost customers, and insurance headaches.

✅ Takeaway: Be prepared to:

✔️ Offer phased work plans so businesses can operate during restoration.

✔️ Provide temporary power, HVAC, and drying solutions.

✔️ Work after hours or on weekends to minimize disruptions.

3. You Must Understand Business Interruption (BI) Insurance

Many commercial claims include Business Interruption (BI) Insurance, which covers lost revenue while the business is shut down.

💰 Why It Matters:

🔹 The longer the job takes, the more the insurance company pays in BI claims.

🔹 Carriers will delay approvals to reduce the BI payout.

🔹 Business owners will push for faster restoration—but insurance may slow things down.

✅ Takeaway: Mastering BI claims can help you speed up approvals and secure more jobs.

4. You’ll Deal with More Decision-Makers

With residential projects, you usually work with:

🏡 One person (the homeowner) and their adjuster.

With commercial projects, you deal with:

🏢 Property managers

🏢 Business owners

🏢 Insurance adjusters

🏢 Third-party consultants

🏢 Risk managers

🏢 Building engineers

🚨 These people don’t always agree. You’ll have to navigate their competing priorities.

✅ Takeaway: Learn how to communicate and negotiate with multiple stakeholders.

5. Insurance Companies Fight Harder on Commercial Claims

💰 Bigger claims = more scrutiny from the insurance carrier.

🔹 They will bring in third-party consultants to challenge your estimate.

🔹 They will push back on pricing, drying times, and scope of work.

🔹 They will delay payments to pressure you into lowering your bill.

✅ Takeaway: If you don’t have strong documentation, contracts, and negotiation skills, you’ll lose money.

6. Scoping is Everything—It Determines Your Profitability

Many commercial contractors lose money because they underestimate the true scope of work.

🚧 Common Scoping Mistakes:

❌ Missing hidden damages (water-wicked walls, smoke penetration)

❌ Not accounting for containment & safety measures

❌ Underestimating equipment needs & rental durations

❌ Forgetting business continuity expenses

✅ Takeaway: Scope everything properly before submitting a price—pricing starts with accurate scoping.

7. Payment Takes Longer—You Need Cash Flow Reserves

Unlike residential claims, where payments arrive in 30-60 days, commercial payments can take:

💰 60-120 days (or longer).

🚨 This can destroy your cash flow if you’re not prepared.

✅ Takeaway: Before taking on commercial projects:

✔️ Have financial reserves or lines of credit to cover operating expenses.

✔️ Require deposits and progress payments to stay cash-flow positive.

✔️ Structure contracts that protect you from long payment delays.

8. Compliance, Permits, & Regulations Are Stricter

Commercial buildings are subject to stricter building codes, OSHA regulations, and environmental rules.

🚧 You may need:

✔️ Engineering approvals for structural drying

✔️ Industrial hygienists for mold and asbestos clearance

✔️ OSHA-compliant job sites (fall protection, confined spaces, PPE)

✅ Takeaway: Before you take on a commercial job, understand the compliance requirements for that property type.

9. Your Marketing Approach Must Be Different

Homeowners find you through Google searches, referrals, and insurance agents. Commercial clients don’t.

🏢 Property managers, facility directors, and risk managers hire contractors they know and trust.

📈 Your job is to build relationships with the right people before they need you.

✅ How to Market to Commercial Clients:

✔️ Join BOMA (Building Owners & Managers Association) or IFMA (Facility Management Association).

✔️ Attend commercial real estate events and networking groups.

✔️ Connect with property managers on LinkedIn and build relationships.

✔️ Offer free emergency planning consultations to get in the door.

🚨 “Getting on a vendor list” is NOT enough—you need personal connections.

✅ Takeaway: Focus on relationship-based marketing, not mass advertising.

10. Start Small and Scale Up—Don’t Jump Into Huge Jobs Right Away

🚨 Many restoration companies fail in commercial work because they take on a job that’s too big, too soon.

🏗️ Large commercial losses require massive resources, cash flow, and experience.

✅ Start Small With Jobs Like:

✔️ Office space water damage (1-2 floors)

✔️ Restaurant fire cleanup

✔️ Retail store mold remediation

✔️ Small multi-family unit restoration

Once you gain experience, then start bidding on larger projects.

✅ Takeaway: Master small commercial jobs before chasing million-dollar projects.

Final Thoughts: Are You Ready for Commercial Restoration?

Commercial restoration is a huge opportunity, but it requires a different mindset, skills, and financial strategy.

🚀 If you’re ready to start, focus on:

✔️ Small jobs first (don’t chase massive projects right away).

✔️ Learning commercial insurance, BI claims, and payment cycles.

✔️ Building relationships with property managers and facility directors.

✔️ Structuring contracts to protect your business and cash flow.

✔️ Strengthening your scoping, compliance, and documentation processes.

At CATx, we help restoration contractors successfully enter and scale in commercial restoration—without making costly mistakes.

📩 Want expert guidance on breaking into commercial work?

Contact CATx today and let’s build your commercial restoration success plan!

🔗 Click here to learn more about CATx

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