1-800-Packouts – Presenting a Unified Front

Business View Magazine interviews Kevin Loner, CEO of 1-800-Packouts, as part of our Top Franchise Opportunities series

After a flood, fire, or any other natural or manmade disaster devastates a home or business, the process of cleaning up generally is orchestrated by the policy owner’s home and property insurance companies who then contract the services of an extensive army of restoration professionals, all playing their own particular part in the claims process. “You have a mitigation side that sets up dehumidifiers for drying out a structure after a water claim or a fire,” explains Kevin Loner, CEO of 1-800-Packouts. “Then you have a textile company that will come in and remove all the clothes and drapes.”

“We handle all the personal property for a claim,” he continues, “which is any furniture, any artwork, any brick-a-brac, any keepsakes, basically any furnishings. This handling of personal property is called a ‘packout’ – an industry term that the insurance restoration field uses. When you have a loss in a house or a business, they look at it and say, ‘Will there be a packout?’ They don’t ask about personal property; they don’t ask about moving it out; they simply call it a ‘packout.’ That’s where we come in. We inventory, pack, and move the items in our own branded boxes and trucks back to private facilities that are not open to the general public. The items are stored in private-room, climate-controlled units that each franchise owns. If we need to clean the items, like after a fire when they are covered in soot, our franchises have high-tech ultra-sonic cleaning rooms that are used. After cleaning, the items would go back into long-term storage until the home is ready to be moved back in after all restoration work is completed. We bring all the items back, and we will set them back in place.”

Loner comes from a family that has been doing personal property claims for almost thirty years. His new company, 1-800-Packouts, however, was recently started in 2013, after the fortuitous attainment of the 1-800-Packouts moniker. “We’re blessed to have the 1-800-Packouts name and number. We were initially looking to put it to market for ourselves to go along with the company that we also own that provides service on the structural restoration side of the insurance restoration field; however, we began to get approached regularly by many [insurance] carriers in the industry that were asking us what we were planning to do with it.”

Loner realized they had a potential tiger by the tail. Having an 800 number like this is a tailor-made marketing phenomenon in an industry, especially the insurance restoration industry, where everyone still does business over the phone. “Of course, that’s when the light bulb went off and we said, ‘We might have something here that can help the industry.’ That’s when we started looking at 1-800-Packouts as a national franchise group.”
Loner explains, “There’s a need for a unified front in the contents industry because when we deal with insurance carriers, they prefer segmenting out the main services, now. They love to have a one-stop, singular place to go and to call for that service in that segmented market. With 1-800-Packouts, adjusters, inside handlers, and agents know what a packout is. When they hear ‘1-800-Packouts’ they know immediately what we do, and what we handle, and we’re instantly branding ourselves. Having been in the industry a number of years, we knew that this name and number were special. Then, when we saw the quick response from carriers in the industry with just our use of it, we knew we had something that we could take to the rest of the country and potentially abroad.”
Jarod Trammell, 1-800-Packouts’ Franchise Executive elaborates: “We had the name and the number and we used it just for ourselves on a regional basis because we handle a lot of large loss claims in the eastern U.S.,” he says. “Once we started getting these phone calls from these carriers, adjusters, and different people, asking us about this name and number that we were using, we started looking at: ‘Do we branch this thing across the U.S., or franchise it?’ Of course, with business being done in different markets of the U.S. in many different ways, it’s much easier for people who are already in those markets and accustomed to how business operates there, to operate a franchise there. That’s why we went the franchising route. Now, we have successfully taken a company and our proven methods that we used solely for ourselves, and the same model is now being used across the United States. We have locations from California to Maine and we continue to fill in locations in between.”

“We’re happy to see where we’re at now,” says Loner. “This is our first endeavor into franchising, so we’ve taught ourselves virtually everything, as we have gone along. We are now over 40 locations nationwide, and we have eight or nine more locations in our immediate pipeline as of today. We have just hit our one year anniversary date for launching our franchise sales. The majority of our franchise group are what we consider ‘conversions;’ meaning they were already doing some form of personal property or packout service before joining our franchise group. What we are able to provide is the efficiency, national platform, and the template pieces that carriers and TPAs are now looking for from this segmented market of the restoration industry.”

Loner believes that a national franchise model for content packouts is the way forward for this part of the restoration industry, and that it will naturally follow the same course as did the fire/water cleanup and the textile franchise segments. “Once the territories are purchased, the local companies have little to no leverage because that national unified front has already solidified handling the business,” explains Loner.

What gives these franchise companies, and now 1-800-Packouts, so much more leverage is that they are listed on a lot of insurance company vendor programs. It is just easier for the carriers, and now for their TPAs – Third Party Administrators, which more and more insurance companies are subcontracting to handle their vendor management programs – to deal with a national operation than with a host of independent contractors. “What is happening now in our industry is that if you are an independent packout company in a particular area, and maybe you have even been doing it for many years in that market, the insurance carriers are stopping them from handling the packout, and they are bringing 1-800-Packouts in to take care of it. Why? Because we are a national vendor for them and they know what to expect when they are dealing with our company,” Loner states. “Being an Independent will become even tougher trying to keep the claim volume up, because carriers and TPAs are looking for a unified front so that it is an easy-in and easy-out process for them.”

Loner further explains, “For example, your house may be insured for a half a million dollars on the structural side because that is what they feel it will cost to rebuild in the event of a total loss, but you might have an additional personal property coverage of $750,000 or more for all of the furnishings. This is a wide-open gap that the insurance carrier needs to be able to close up and control, and thanks to our methods of handling and cleaning the contents in an effective and efficient manner, they are using us as the vehicle to control that.”

1-800-Packouts is growing. “We already have a good core group and we are looking to continue to grow that group,” says Loner. “We are probably looking at a total of 350 to 500 franchises. We won’t have to have a thousand or two thousand dots on the map for our model. We just want a solid group of people throughout the U.S., that are good stewards of the money for the insurance carriers and TPAs. You must have high ethical and morals practices in this business because you’re dealing with people’s personal property. When you really think about the fact that people sell their houses and move, but many of the same items will go with them to each new place, you begin to understand the responsibility that we have in our field of work. Many people have an emotional attachment to items that makes an item virtually invaluable. So, they’re holding us to an even higher standard when we come to handling those items and our franchises throughout the U.S. have to be prepared and they have to hold themselves to that same high standard.”

“What is important to us is that we have given our franchises the tools for efficiency and effectiveness to be able to handle these jobs,” adds Trammell. “It is also important to us that the client and the carrier are both looked after in the proper manner during the process, and that the experience is good for both of them when one of our franchises handles a claim.”

Loner sums up the company’s most immediate goals: “In the next 18 months or so, we are planning to go international. We already have the approvals in place in Canada. Then we’ll turn our sights to overseas. The overall goal for us is to be the number one resource to handle personal property claims, and that when people think of personal property claims, they think of us, 1-800-Packouts.”

AT A GLANCE

WHO: 1-800-Packouts
WHAT: A franchisor in the contents mitigation industry
WHERE: Simi Valley, California
WEBSITE: www.1800packouts.com

PREFERRED VENDORS