This article was first published online by Franchise Times on October 27, 2021 and subsequently published in the November-December 2021 print edition.
Last month I explored an environmental brand’s 20-plus years of global expansion experience, focusing on its recent foray into Canada. This month, the discussion continues with franchise development professional Ron Bender and his role in launching Canadian home services brand Local Handyman Group into the U.S. market.
“Over the past 18 months, the home services industry has exploded. Many franchise systems in the space have proven to be ‘pandemic proof,’ and some even bolstered by the pandemic,” said Bender. “This, combined with the increase in the individuals looking for new opportunities and control over their income, made this brand stand out.”
While there are no guarantees, with each international franchise expansion adventure there are often elements franchisors and their advisers believe support the timing and decision to expand. Some may represent textbook considerations being satisfactorily addressed. Others are visceral in nature, and may include taking advantage of market conditions.
In the case of Local Handyman Group, CEO Craig Jooste said the company “spent a tremendous amount of resources on building out our infrastructure, enhancing system efficiencies and shoring up supply chain. Our expansion has been methodical and carefully timed.” No doubt, these are key items on any robust international franchise development checklist.
From Bender’s perspective, Local Handyman Group checks several other boxes. “Consumers are attracted to a business that is locally operated. They also have more comfortability and confidence that locally operated businesses will pay attention to, and can resolve, their problems. Moreover, the fact that the brand has been successful in Canada—a neighboring country with many points of commonality in the home services space—provides additional advantage,” he said.
Franchisors’ concerns around expansion while COVID-19 continues to affect the world is a live issue. Travel restrictions, supply chain delays and issues, and multifaceted business interruption (among other things) continue to impact businesses.
Local Handyman Group’s system does not require personnel or supplies to cross the border. The training program has been designed to be delivered remotely. The Local Handyman Group has secured supply chain arrangements with international suppliers that operate in Canada and the U.S., such as Sherman Williams, Fiat/Chrysler, Home Depot, etc., which are translatable for U.S. franchisees. While raw materials shortages in certain regions may be a challenge, the expectation is that such a shortage will still work in Local Handyman Group’s favor by bolstering the home improvement trend (which requires less raw materials) over new construction (which requires larger amounts of raw materials). Finally, the mobile nature of the concept allows franchisees to maneuver through many of the governmental restrictions imposed on businesses.
Making the model replicable
As with any franchise system crossing a border, there are practical and system-specific issues that Local Handyman Group will no doubt need to consider and address. The team is cognizant of that, and is assimilating the patchwork of diverse licensing and other regulatory requirements it may face in various parts of the U.S.
Such licensing and regulation also depend on the specific services that respective franchisees choose to provide under the Local Handyman Group umbrella of services. The team has also developed checks and balances to ensure that the vision, mission and culture of the brand are consistently carried over into the U.S.
“We have a heightened sense of ensuring that the model and the culture of the brand is replicable in the U.S. We feel that home services translate well into the U.S., as compared with other industries where the cultural differences between Canada and the U.S. may have an impact on the appeal and ultimate success of a brand’s product or service. Having said that, we will be working closely with our U.S. franchisees to ensure that this is the case,” said Jooste.
The Local Handyman Group team also provided some insightful thoughts on its strategies and expectations for the U.S. expansion. As far as geographical targets, the brand has set its sights on Texas, Florida and the Carolinas, where it expects to gain traction fairly quickly.
“We consider these states to be fairly franchise-friendly; both candidates and customers looking for services are comfortable with the franchise business model. They also have experienced tremendous amounts of residential growth over the past 30 years, which provides greater opportunities for new businesses entering the market. In addition to that, these states have also experienced a more open business climate during the pandemic,” said Bender.
The team intends to position a Local Handyman Group franchise as both a standalone as well as a “bolt on” franchise opportunity. The bolt on option may appeal to business owners already in the home services space as a means to diversify and create cross selling opportunities. It is expected that the bolt option may also be of appeal to professionals looking to take a different career path, and who would prefer to invest in a number of low start-up cost, easy to operate, franchise businesses, as opposed to more expensive brick and mortar concepts.
Another trend the Local Handyman Group team is looking to take advantage of is the increasing concern many millennials (and generation cohorts after them) have around the cost and ultimate utility of college and university education, at least right out of school.
As these interesting times continue to roll on, the Local Handyman Group is taking the plunge to expand into the U.S., and appears well poised to make a splash.