May 1, 2026
Can a 3-month restoration consulting engagement actually add $180K to net profit? Yes. In a real engagement with a Midwest restoration company doing $4.2M in revenue, a structured 90-day operations engagement recovered $180,000 in annualized net profit through five specific changes: tighter supplements, supplier renegotiation, AR cleanup, equipment utilization discipline, and a fired underperforming TPA program.
Details have been changed to protect client confidentiality. The numbers are real. The findings are real. The actions are real. This is what an actual 90-day engagement looks like when it works.
We’ll call them Apex Restoration. Independent. Midwest. Family business, second generation. Doing $4.2M in revenue: 60% mitigation (water, fire, mold), 35% reconstruction, 5% specialty. The owner — Dave — had grown from $2.8M to $4.2M in six years. Real growth. But net profit was almost exactly the same as it had been at $2.8M. He’d hired more people, added trucks, opened a second location. The bottom line wasn’t moving.
Revenue (TTM): $4,180,000. Gross margin: 36%. Operating expenses: 30% of revenue. Net profit: 6% ($250,800). AR days outstanding: 73. Owner hours per week: 65+. Manager turnover (last 24 months): 3. Gross margin was 6–8 points below where it should be. AR was 25–30 days too high.
Finding 1 — Supplements were a disaster: Apex was filing supplements on 35% of insurance jobs. Industry-best: 75–85%. Supplements that did get filed were weak — missing line items, missing photos, missing scope justification. Estimated annual recovery: $85,000–$110,000.
Finding 2 — One TPA program was actively unprofitable: About $480K in annual revenue running at 22% gross margin after all program concessions and hold-back. After accounting for allocated overhead, the program was actually losing money. Dave had never run the math. Estimated annual recovery: $40,000–$65,000.
Finding 3 — Equipment was being given away: Air movers, dehus, scrubbers not making it onto invoices consistently. Crew chiefs billing three days when equipment was on-site four nights. Estimated annual recovery: $20,000–$30,000.
Finding 4 — AR was managed reactively: No weekly cadence, no escalation protocol. Some invoices 120+ days outstanding because nobody had ever called the carrier. Estimated annual recovery: $15,000–$25,000 in collections headed for write-off.
Finding 5 — Subcontractor margins were thin: Dave hadn’t pushed pricing in three years while subs quietly passed along their own cost increases. Estimated annual recovery: $20,000–$35,000.
Gross margin: 39% (up from 36%). AR days outstanding: 51 (down from 73). Supplements rate: 78% (up from 35%). Annualized run-rate net profit: $431,000 (up from $250,800). Net profit improvement annualized to roughly $180,000. Dave was working about 50 hours a week instead of 65+. The leadership team had a working operating cadence. The owner had visibility into the business he’d never had before.
It’s representative of engagements at this revenue level ($3M–$5M with 6–8 points of margin gap to fix). Smaller companies have smaller dollar opportunities but similar percentages. Larger companies often have bigger absolute numbers — I’ve run engagements where the first-year recovery was $400K+.
The engagement paid for itself by week 7 in identified margin recovery, before any changes had been fully implemented. By day 90, the ROI was over 4x. By end of year one, over 10x.
Walking away from the bad TPA program. Dave had been in it for years. The program manager was a friend. The trucks were rolling and it felt like real work. Looking at the math and accepting that “busy” was actually “unprofitable” was emotionally hard. The other changes were easy by comparison.
Mike McCabe is The Profit Detective — 36-year restoration veteran and Fractional Operations Manager at Floodlight Consulting Group.
Most engagements pay for themselves within the first week.