It’s all good news for property services franchises. The bfa's research shows that property services is the third biggest franchise sector
Here’s a certainty: you will have to spend money on home renovation and maintenance. The lights will fuse for no apparent reason, the drains will need unblocking the day before you go on holiday and you’ll look at your kitchen in October and decide you can’t possibly leave it as it is, what with the family coming for Christmas.
Even renters commonly have to get the oven professionally cleaned before moving out. It’s all good news for property services franchises.
British Franchise Association research shows that property services is the third biggest franchise sector. One in every eight franchise units (about 920) are part of property services franchises.
Services range from cleaning, drain clearing, electrical maintenance, kitchen refurbishment and ventilation to full-scale renovation and disaster restoration.
Franchises include mobile businesses, where franchisees do the practical work themselves and may later expand to employ technicians. Typically, they suit people who already have, or can learn, the practical skills, but who also have customer service skills.
There are also many management franchises, where owners manage teams of specialists who carry out the practical work. Rather than practical skills, franchisees need project, team management and sales skills.
Before deciding on which franchise to go for, research the market for their services.
Renovations and makeovers
Homebuyers often tear out old kitchens and bathrooms and replace them with new - a boon to franchises that manage the design and installation of them. Nevertheless, HMRC statistics show that residential property transactions have declined by 12.4 per cent since July 2018, so this source of business will have shrunk.
However, the number of homeowners choosing to improve rather than move has risen fivefold since 2013. In the last five years, the numbers rose from three per cent to 15 per cent of UK households - a total of four million. These figures come from the 2018 Home Renovations and Extensions report from insurance company Hiscox, which is full of useful information if you’re considering a property sector franchise.
Many of these projects are more than cosmetic makeovers. Hiscox found that planning permission requests from homeowners rose 29 per cent in the 10 years to 2017. In the London boroughs of Redbridge and Harrow, one in 28 households made an application. Outside London, St Albans led the way at one in 34, then Uttlesford in Essex and Elmbridge in Surrey (both one in 35). Weymouth and South Ayrshire brought up the rear: only one in 700 households submitted planning applications in 2017.
Money to be made
Hiscox reports that in 2017 renovators with work underway or in the pipeline were working to a budget of around £16,100 for each project, although one in five expected to invest upwards of £25,000.
However, overspends and delays in project completions are rife. Two in five people who had completed projects said they overshot their original budget by an average of 20 per cent - equal to over £3,200. Over a third of past home improvers (35 per cent) experienced delays in project completion averaging three months.
No wonder the stress of ‘having the builders in’ is a regular topic of conversation. Figures quoted by Refresh Renovations, a New Zealand franchise that launched in the UK two years ago, show that in New Zealand, which has a similar culture to the UK, 31 per cent of renovation projects result in a dispute.
These are not just rows about the colour of the bathroom. Vincent Smith, UK general manager at Refresh Renovations, says: “Often disputes are caused by a lack of understanding between clients and builders about what’s wanted, dissatisfaction with the work and time and cost overruns. Figures also show that about 30 per cent of renovation costs are wasted because of poor upfront planning and lack of project management.”
Refresh Renovations provides a project management service for domestic renovations, working with clients for a fixed fee to a set timeline.
Vincent adds: “Our franchisees do not need construction sector experience or a desire to be a builder, but they should have good people and process management skills and a customer-focused attitude.”
Repair and maintenance franchises
People seem to be putting off getting their homes fixed, at least for now. Office for National Statistics figures show that there was a six per cent decline in private housing repair and maintenance during the period April to June 2019.
However, pipes will still leak, drains will get blocked, cleaning will always be required and electrical faults will need fixing, so demand for domestic repair and maintenance services is always there - and there are plenty of franchises that supply them.
Franchise businesses aim to sell their services on professionalism, looking to provide a combination of technical skills and customer care.
Philip Carr, managing director of Neighbourly UK, which owns six franchise brands, including Drain Doctor and Mr.Electric, says: “Our 250-plus franchisees serve millions of customers across the UK, from homeowners to landlords and housing associations. They look for trained, uniformed and well-equipped services experts, who can provide exceptional work and customer service.”
If you want to start - or already have - a property maintenance business, a franchise can help you stand out, partly because an established franchise has a name that is already known, the franchise head office will provide national publicity for you and, in many cases, supply leads and appointments. Many have national contracts.
Branding is important. Drain Doctor says on its franchisee recruitment website that a study of 9,000 customers showed that contractors affiliated with a national franchise were preferred by a 2:1 margin.
What to check
Rik Hellewell, founder and managing director of oven valeting franchise Ovenu, established for 25 years, says: “The growth in lettings has meant more business for us because landlords specify that ovens must be clean at the end of tenancies. But competition has increased, as less scrupulous operators undercut on price and quality.”
He advises people considering an oven cleaning franchise: “Check reviews from customers, check the services provided by the franchisor, research the history of the company and ensure it is well funded. Speak to existing franchisees and customers.”
After a career in the food industry, Simon Herbert chose an Ovenu oven valeting franchise, having used the company’s services in the past.
He says: “I learnt many skills in the food industry over the last 20 years, including IT, logistics and finance, which I can apply to this new venture. Franchising made sense, as I have never been in business before and the support of the brand and head office will help.”
Ovenu trains franchisees in its valeting process, which involves dismantling ovens and soaking parts in a tank of safe, non-caustic products for cleaning. It also provides head office marketing assistance and customer leads, leaving franchisees free to get on with the practical side of the business.
“I’m serving homes and businesses throughout Ashford, Kent and hope to grow the franchise and expand further into new territories,” Simon says.
3 most popular renovation projects
Choosing a franchise that addresses the most popular household renovation projects may give you a higher chance of success. The top three areas where homeowners were undertaking or planning work in 2017 were:
1. The bathroom (54 per cent).
2. The kitchen (51 per cent).
3. The garden (29 per cent).
Special mention: loft extensions. Planning applications for loft extensions increased by 114 per cent between 2008 and 2017 and were the number one reason for the growth in domestic planning applications.
“I loved doing up houses. Now it’s my business”
Kelley Malcher, from Woking, Surrey, says: “I have renovated three of my own properties and enjoyed planning the projects and coordinating the teams doing the work, so when I wanted my own business I looked at the property renovation sector.
“My previous jobs had given me people and project management skills and experience in liaising with customers. In my last job, I was project managing web developers, so it was not a big jump to manage teams of builders.”
Because she lacked experience in running a business, Kelley decided to invest in a franchise and chose Refresh Renovations. Now she manages client’s projects such as home extensions, loft conversions, kitchen redesigns or bathroom refits. Since launch 18 months ago, she has managed 11 projects and won some repeat business.
“My own experience of builders not sticking to quotes or overrunning and sometimes delivering poor quality work made me determined to ensure my teams deliver quality results on time and on budget,” Kelley says.
Following up leads from the Refresh Renovations website, referrals and word of mouth recommendations, Kelley visits all potential clients and follows the Refresh five-stage design to build process, keeping the customers’ needs as the focus. She then manages the project, including planning, surveys, design and practical work.
“There is a relatively small cost for the planning stages in the Refresh process, but this enables us to spend the time needed organising each project properly, meaning that budgeting and timelines are more streamlined,” Kelley says. “Spending time upfront planning sets us apart from most building companies.
“It’s a creative and rewarding business - it was in profit in year one - and for clients, it makes renovation projects less stressful.”
Linda Whitney writes about franchising for the Daily Mail, What Franchise and many other publications.