Not everyone is an entrepreneur, but that doesn’t mean you can’t reap the financial rewards of those who are, says Gas-elec’s John Davidson.
John Davidson was an electrician by trade but wanted to earn more from the business he enjoyed. In 1996 he launched Gas-elec, a gas and electrical safety inspection service for landlords and businesses. The difference between his company and the others was that this service could be performed by one engineer in a single visit. Demand exceeded supply very quickly and he realised recruiting and training new staff would take too long, result in disappointed clients and stunt business growth. Davidson decided that a franchise operation was the only answer. He’d achieve nationwide coverage using qualified engineers, and the engineers would benefit from guaranteed additional business. And it worked. Now Gas-elec has 100-plus franchisees, providing services to more than 80,000 properties and enjoying year-on-year growth.
“The reason for our continued growth is purely down to flexibility,” says Davidson. “We’ve always been sensitive to changing market developments and new legislation. For example, the government’s drive to achieve long-term cost savings through energy efficiency and carbon emissions reduction installations means it will be illegal to let a property which has an EPC rating below E from 2018. This increased pressure on compliance will continue to grow our sector.”
With a constrained supply of social housing leading to exponential growth of the private rental market, this franchise operation will continue on its upwards trajectory.
But franchising’s not for everyone. There’s the upfront investment to consider – that’s around £23,000 for starters – and his most successful franchisees are those who are proactive at selling. And that’s when Davidson saw another way for all installers to make more money… and it has nothing to do with franchising. It’s a home improvement finance scheme, called Home Project Finance.
“There’s a limit to the profit you can make from an annual service or boiler installation but it’s definitely easier to get business from existing business. And, in reality, your customer probably wants to realise the dream kitchen or upgrade the heating system, but money’s the stumbling block. This no-nonsense finance package enables the customer to access the funds to make home improvements up to a value of £25,000, and provides the installer with additional work.”
Davidson says you don’t have to be marketing-savvy to see where a home would benefit; you just need to know about how the benefits of the scheme works and the customer takes it from there. The installer isn’t involved in the finance agreement at all and the customer can access the funds within as little as 48 hours after approval.
Home Project Finance is an effective way to make smaller jobs become larger projects, boost revenue and deliver the priceless marketing tool of word-of-mouth endorsement.