COULD A HOME IMPROVEMENT FRANCHISE BE A LIFESTYLE IMPROVEMENT FOR YOU?
If you’re obsessed with The Block, have Bunnings on speed dial and are looking for the perfect franchise opportunity, don’t look past the home improvement industry.
Two reasons why it’s worth a look:
• Many of us have caught the DIY bug during Covid lockdowns, when we’ve had nothing better to do than look at four walls and become acutely aware of what does and doesn’t work at home.
• And with interest rates at an all-time low, travel out of the question and house prices booming, where better to spend your money than on your home? Or on a franchise that will let you to grab a slice of the home improvement pie?
That pie is certainly a fat one
One out of three Australians are planning to renovate in 2021, with an average spend of $26,000, according to a survey commissioned by leading Australian bathroomware retailer, The Blue Space.
That’s a potential spend of around $200 for every person in Australia, a whopping $52 billion this year, up nearly 16% from the $45 billion estimated by consulting firm DGC Advisory to have been spent in 2020.
Having been kept at home for so long by the pandemic, the majority of those surveyed by The Blue Space said they were inspired to improve their spaces so that they and their families could better enjoy them.
Spoiled for choice
Whether homeowners wish to add value to their properties with a fresh coat of paint and new carpet, flooring, drapes or blinds, or go a step further with a new kitchen or bathroom, an extra room, a second storey, a garage or an outdoor entertainment area, one thing is for sure: there’s a franchise out there to service their needs. So if you’re considering a home improvement franchise, you’re certainly spoiled for choice. But apart from that, why go for home improvement rather than another popular franchise category such as home services or food and beverage?
Create lasting value
One of the top reasons given by home improvement franchisees, in my experience, is the satisfaction you get from creating a home environment for your customers that enhances not only their lives but the lasting value of their homes. The key words here are ‘creating’ and ‘lasting’. With home services such as cleaning and repairs, you’re not creating anything new, simply maintaining what’s already there. The satisfaction that home improvement franchisees get from creating lasting value generally means that the hours they invest in growing their business don’t feel like work because they love what they are doing. And every customer offers an opportunity to create something unique.
Other reasons for choosing a home improvement franchise include the flexibility and variety in franchisees’ working lives, franchise affordability and the fragmented nature of the home improvement industry. Although home improvement franchisees need to be self-motivated and reliable, they are not generally constrained by retail opening hours or regular contract service times. Because many are able to operate from home or mobile bases, their start-up and operating costs can be lower than many other franchises. And as there are few major players in the home improvement industry, joining a franchise gives franchisees several competitive advantages over stand-alone businesses – including ready-made branding, marketing and operating systems as well as the training and support you need to get your business up and running as smoothly as possible, even if you have little industry or business experience.
Get a leg-up into your own business
“Our mission is to give builders a leg-up into their own businesses and take as much of the cost and risk out of starting up as possible,” says Russell Poole, Managing Director of Pzazz Building, which has the distinction of being New Zealand’s first national specialist home renovation franchise. “Because we see our relationship with our builders as a longterm partnership, we keep our initial fees low so they have enough capital available to build healthy, growing businesses. It’s a win-win for both parties.” To get into other home improvement franchises can cost between $10,000 and $1 million+, depending on the type of business. For example, Outside Concepts, a franchise specialising in outdoor home improvement projects such as carports, pergolas, gazebos, verandahs, decking and pool and spa enclosures, charges $57,500 + GST. As with all franchises, you will also need working capital—cash needed to operate the business and live off until the business starts making money. Outside Concepts says this normally takes between 6 and 12 months. Many of their new franchisees continue with their existing employment or take a part-time job to cover living expenses while building the business. This reduces the amount of working capital they will need. “One of the top reasons given by home improvement franchisees, in my experience, is the satisfaction you get from creating a home environment for your customers that enhances not only their lives but the lasting value of their homes.”
Questions to help you choose
Upfront cost is just one of the factors in choosing the right franchise. Another is the amount of training and support you will receive from the franchisor, especially if you are new to the industry or to running a business. Franchises such as Pzazz Building will provide you with comprehensive training, business systems, design services and support, and will pass on any customer leads they receive from their national marketing, but expect you to manage and grow your own business. On the other hand, franchise systems like Bathroom Werx will provide you with the marketing, call centre, job scheduling, invoicing and debt collection needed to administer your franchised business so you can concentrate solely on the job of servicing customers and making money.
• To find the home improvement franchise opportunity that works best for you, you will need to ask yourself some tough questions about your expectations, needs and skills and evaluate them against what each opportunity offers.
• What am I good at? Will the franchise allow me to use my skills while training and supporting me in things I’m not good at?
• What do I like doing? Will I be satisfied with operating this type of business in the long term?
• Am I comfortable with following the franchise’s systems or do I prefer doing my own thing? While all franchises require you to follow their systems, many in the home improvement sector require a degree of entrepreneurialism rather than simple compliance.
• How much can I afford to pay and what return am I likely to get on my investment?
Robin La Pere is a franchise consultant with more than 20 years’ experience as a franchise manager, CEO and owner as well as a consultant, coach and speaker on franchising. Based in Auckland, New Zealand, he works with clients throughout Australasia and internationally. He is a specialist in business model development, strategic planning, process improvement, innovation and franchise recruitment marketing.
Disclaimer: Robin La Pere is a shareholder and non-executive director of Nuovo Group Ltd, the owner of the Pzazz Building brand.