Business Franchise Australia

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Home Services – Taking care of business

Do you remember that great song “Takin’ Care of Business” written by the Canadian rock group Bachman -Turner Overdrive (BTO) for their 1973 album?

 

Maybe this is showing my age! The song was about a recording technician who would take the 8:15 a.m. train to work, inspiring the lyrics “take the 8:15 into the city”.

 

How life and taking care of business has changed since 1973!

 

As much as we all still like to have a retail splurge and spend a day at a shopping centre (occasionally) we have become accustomed to many services being delivered to our door.

 

The home services sector is one of the growth sectors in franchising with great opportunities for a prospective franchisee who wants to run their own business with flexible work hours and not be tied down to a retail or office environment.

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The services and products that can be delivered to our doors these days are enormous.

 

For the consumer we all want to free up our leisure time and have the ease of our groceries delivered to our door, our pooch washed, lawns mowed, gutters cleaned, and car serviced as we are all super busy.

 

There are many advantages to both consumers and businesses with a home services business.

 

For the business, they no longer have to wait for the consumer to knock on their door nor incur the overheads of high end premises and costs of a retail footprint.

 

They can keep their overheads low and focus on service and marketing on social media and through other more effective marketing options.

 

New Franchise Opportunities in Home services 

Home Care and NDIS

 

The area of home care and NDIS support has really taken off greatly supported by the Governments commitment to funding the sector.

 

Sanicki Lawyers have advised a number of NDIS and home care providers in relation to establishing a franchise model.

 

We have also advised numerous franchisees in the highly successful Nurse Next Door home care franchise that has been rolling out successfully in Australia.

 

Amber Biesse and Matt Fitton, co-founders of Nurse Next Door Australia, chose the successful Canadian Franchise system for the Australian market and it has proven highly successful. The franchise is well supported providing companionship to end-of-life care while helping clients stay at home longer and providing 24/7 support.

 

They also provide a centralised scheduling team that handles calls and inquiries daily and manage client visits.

 

The Federal and state governments have announced spending around $39 billion on the NDIS in 2023-24 and continues to be supported by the Federal Government.

 

We have also been working with John Roberts Director of Complete Care & Nursing Franchising. Complete Care as a company has been operating for some years in the NDIS sector very successfully and developed state of the art software systems to support their patient carers and clients in a very regulated sector.

 

John was determined to then roll out his system and successful brand for franchisees ensuring the franchise model would be affordable, with fair and reasonable fees payable by franchisees to ensure their success.

 

John has vast business experience in many business sectors over a long and distinguished career and established the Complete Care Franchise system to support franchisees with the latest technology, financial modelling, training and marketing.

 

Home cleaning

The cleaning franchise market is highly competitive and has grown during and post the pandemic from when it was considered an ‘essential service”. It continues to be a growing sector due to changed work conditions.

 

The opportunity in this sector is immense and include well known systems such as Jims Group, O’Brien (glass plumbing and electrical), V.I.P. Home Cleaning & Lawn & Garden Maintenance, James Home Services and many others.

 

Over 75% of the revenue in this sector is generated by Jim’s Group, O’Brien and VIP Home Services with around 32% of the revenue from building installation services and 15% in maintenance, gardening and other construction services.

 

 

Home Maintenance and Repairs

 

These franchises tend to be underestimated yet offer excellent opportunities for individual operators to run their own business with flexible work hours.

 

This sector mainly consists of sole traders or  husband and wife team or partnership and includes plumbing, fencing and painting franchises.

 

Franchise businesses are more effective in marketing and promoting services than independent tradespeople which make mobile and home service franchises attractive.

 

This sector is underpinned by household spending on outsourcing trade services and household chores, like gardening and cleaning.

 

Industry revenue is estimated to grow by around 2.3% to $1.4 billion up to 2028-29 and certain franchises will continue to benefit from residential building and low cost affordable housing initiatives driven by rising population.

 

Franchise businesses will continue to capture a greater share of the trade and home handyperson skills market than individual sole traders.

 

The future in the sector is also positive as household spending on repairs and maintenance continues to provide a stable source of work for franchisees.

 

Sanicki Lawyers acts for a  number of home help franchisors such as The Grey Army (home repairs and maintenance) and for many years for Fix N Chips (surface repairs and cleaning) which are franchises that provide franchisees flexibility of work hours and a good return for their effort.

 

 

Mobile Franchises 

Mobile franchises are also attractive due to their low cost of entry, low overheads and flexible work conditions. Due to low overheads a franchisee can earn a reasonably good wage for their effort and build their customer base using digital marketing and social media again at low cost.

 

Like any franchise you still need to do your due diligence to see if its right for you as no two franchise systems are alike in relation to the franchise fees they charge and ongoing costs.

 

Some franchisors will charge a fixed fee whilst the majority still charge a royalty based on the gross revenue and also a marketing levy.

 

We recommend you seek legal advice and seek financial advice before you commit.

 

Once you have taken up a franchise there are only limited ways to exit the franchise, so you do need to  ensure the franchise model and revenue will allow you to take a reasonable salary out of the business for your effort along the way, as there may not be a capital gain at the end!

 

How to select the right franchise for you?

 

Even though they may be low cost entry, the average cost to set up a home based or mobile franchise may still cost between $60 to $100,000 which is a significant investment  so you need to make sure the financials work for you.

 

Seek independent financial advice and do your own  modelling and projections before you commit.

 

If the numbers don’t work, then we suggest you walk away as there will be many other opportunities and systems that will.

 

Here are things to consider to reduce your risk and make an informed decision.

 

  • Is the franchise an established or new brand? A new franchise can be a great opportunity but it can also be a higher risk.
    • Is there a long term market need for the product or services offered or is it a passing fad or trend which means in 3 or 5 years there will be little demand for the product or service?
  • Who is the franchisor? what experience have they had? will you meet the owner/ director or just the sales representative or broker?
  • What training and support is offered ? what time and attention do you need to give to the business to take a reasonable salary ?
  • Talk to other franchisees in the system and get their feedback on the franchisor and system?  You should contact at least 3 to gain different views.
  • Is the Franchisor embracing the digital and on-line environment and social media or competing with it? If not, it may be vulnerable to competitors in the market.
  • Are you simply buying yourself a job? That’s fine, but don’t be afraid to walk away before you sign up if the numbers don’t work or if you are unable to at least draw a basic salary.
  • Are you a “force for good “and prepared to work within the franchise system rather than trying to fight or change it?  If you want to change the system, don’t be a franchisee as it will likely lead to dispute!
  • Is this something you can see yourself still enjoying in 2 or 3 years once the novelty wears off ?
  • Will you need to drive and travel long distances to see your customers? This can add to your operational costs.

Lots to consider but franchising continues to be a very successful business model that enables many who would not otherwise have the ability or experience to open their own business to carry on a business supported by a good brand, system and training.

 

Summary 

As with any business investment it comes with risks so do your due diligence on the franchisor just as much as they will do their due diligence on you and make sure you take care of your own business, by seeking Specialist Franchise Legal and financial advice before you commit. 

 

Robert (Hound Dog) Toth | Special Counsel | Accredited Commercial Law and Franchise Specialist

Robert Toth is Special Counsel and Franchise Specialist at Sanicki Lawyers, with over 35 years of experience in franchise, licensing and distribution law. Robert is also  an Accredited Commercial Law Specialist and regularly publishes articles on line on Franchising and Licensing and acts for Overseas Franchisors and Master franchisees and in disputes mediations. 

email: robert@sanickilawyers.com.au | mobile: 0412 67 37 57