CHICAGO — A late-night fire scorches a two-story home, but firefighters are able to douse the flames before the structure is destroyed. Still, the smoke and water damage is extensive. Now, in his time of greatest need, the homeowner turns to his insurance company to begin the process of getting his family’s lives back to normal.
So, who does the insurance provider turn to at a time like this? It’ll call in contractors to see about repairing and/or rebuilding the structure, but before that can happen, something has to be done about the family’s personal belongings. Can they be saved? Are they worth saving?
That’s when the smart adjuster calls in a dry cleaner that specializes in restoring garments and soft goods. Long an offshoot of dry cleaning, restoration has come into its own as the add-on that can easily eclipse the core business.
When American Drycleaner last featured this niche market five years ago, it was written that “restoration is no longer a matter of saving a cherished wedding gown or antique quilt—it’s about reclaiming any item still useful to the customer and cost-effective enough to rehabilitate for the insurer.”
That still holds true today, plus the insurance industry’s increased awareness of restoration dry cleaning has led to more work for those businesses with the expertise to meet the needs of the homeowner and the insurance carrier during arguably the most trying of times.
Since launching in 2002, the Certified Restoration Drycleaning Network (CRDN) has about 150 franchise operators in the United States, Canada and the United Kingdom. It generates revenues in excess of $100 million annually.
“We see the market continuing to expand,” says CRDN CEO Wayne Wudyka. “(Insurance) carriers are far more aware of the category and the value of a good textile restoration expert today more so that they ever were.”
Jim Nicholas is president of FRSTeam, a Hayward, Calif.-based franchiser of restoration services. His company has been selling franchises since 2005 and currently has 40 franchise locations and seven company stores throughout the United States.
“Insurance companies have identified the value of having a relationship with a textile restoration company, rather than have us be a tertiary contact or someone that a contractor would just bring in,” he says. “There are more insurance companies that are looking at us as a specialty in and of ourselves, and a relationship that warrants more direct interaction.”
Nicholas sees more market segmentation along the national and regional fronts than there was five years ago. “There’s more established brands now. There are some marketplaces where, in some of the large urban areas, you can have between eight and 10 restoration dry cleaners all competing for the business in that market space.”
There are other franchises in the market, such as Evans Garment Restoration and TexCare, and there are independent restoration operators as well.
A group of independents, most of which are longtime family-owned and -operated businesses, comprise North American Restoration Dry Cleaners (NARD), an association led by Mark Folzenlogen, president of A-One Fabric Restoration in Cincinnati.
More and more cleaners have “flooded” the restoration market since retail dry cleaning sales began to dip amidst the weakened U.S. economy several years ago, according to Folzenlogen.
“There were a lot of people getting into the industry, and we were concerned that it was beginning to get a bad reputation,” he says. “You’ll find most of our members have been in the business a long time, so we’ve come up with best practices to try to offer the best possible answer for the longevity of this industry.”
Check back Thursday for the conclusion!