Home Supply Franchise Demands Decline As Handyman Franchises Boom
September 10, 2014
The do-it-yourself (DIY) handyman trend boosted the fortunes of home supply stores for decades. But as baby boomers aged and time became more precious than money for this generation, “do-it-for-me” (DIFM) handyman services have blossomed – and franchise companies have been quick to take advantage.
The shift from DIY to DIFM began roughly as the 1980s drew to a close. While a few handyman service companies already existed, it wasn’t until the mid-1990s that they began to appear in force – and franchise.
By 2003, home repair and improvement was named one of the fastest-growing franchise categories in the U.S. by the Wall Street Journal. Since then, the segment has expanded even farther – both as a resource for the nation’s growing number of aging homeowners, and as a business opportunity for entrepreneurs.
Franchisors in the handyman, home repair, and property maintenance segment are not looking for franchisees who can wield a hammer, fix a leak, or build an addition to an existing home. They’re looking for executives who can recruit skilled workers and successfully manage a business, whether home-based or from a storefront. Total entry fees vary, depending on territory size, brand, services, and region, and typically range from as low as $35,000 to $175,000 or more.
Estimates of the home improvement market run as high as $150 billion annually , with nearly one third of that classified as minor repairs that homeowners lack the time or skill to do themselves. And with the large majority of the nation’s housing stock more than 15 to 20 years old, franchisors see huge opportunity for growth in this built-in, geographically diverse, and under-served marketplace.
Other factors contributing to the growing need for reliable home repair and improvement include: second homes, vacation homes, income/rental units, and commercial property maintenance. Another demographic plus for home improvement franchisors is the increasing number of seniors living well into their 80s and 90s and wishing to remain in their own home.
Tied in to that is the trend to remodel and renovate current homes, rather than move, not only for seniors, but also for younger families with school-age children who cannot afford to “move up” in today’s pricey real estate market.
Further, franchisors in this segment are well aware that each home sale involves at least three opportunities: 1) the seller preparing for the house for sale by repairing and improving it; 2) the buyer then altering their new home to suit their needs and tastes; and 3) homeowners continually spending about 1 percent of their home’s value each year on maintenance.
Historically, it’s fair to say that in addition to being a lucrative, evergreen industry, the home repair business has been disorganized, flaky at times, and shady at others. The new breed of franchisors entering the marketplace see themselves bringing reliability, responsibility, and higher ethical standards to the business.
One long-time problem franchisors are solving through the use of scheduling and management software: having the handyman show up on time and complete the job on schedule – a stark contrast with the old story of the single guy and his pickup truck showing up to estimate a job, get a deposit, start the work, and never be seen again.
For consumers – whose home is the single most expensive investment they will ever make – it’s reassuring to know that franchisors are providing skills assessment, continued training, and background and reference checks for the repair personnel who show up at their homes. Franchisors are also able to provide (and back up) on-time guarantees, as well as guarantees on labor – and they can be found a year or two later if needed.
Franchisors that understand the value of providing a reliable, quality delivery system for home repair services will thrive in the coming decade. In addition to a vastly undersaturated market, much room for innovation remains as the segment expands and matures.