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Acquisitions at branch level are something we promote and encourage. Many of our agents have successfully acquired competitor agents or their portfolios.
Nick Neill Ewemove
decorations, flooring etc) to include fixtures and fittings such as signage, displays, soft seating, desking, staff seating, storage and so on, should be considered.
“New start-ups may wish to work from home initially until cash flow picks up,” says Stephens. “Franchisees have opened with budgets of circa £15-£20k. One recently opened office brought in just under £5million of sales in their first half year and this increased to £8million in the same period the following year. This success has continued into 2022 with further growth of 74% for the Q2-Q3 period, with a total value of £15.6m brought to market so far this year.” So given the right market conditions, a franchise can be a springboard to success.
Differing models
Lucy Britton at Winkworth says a royalty fee for a franchise with Winkworth is 8 per cent of gross receipts. “We have entry level business sales up to £1.5m, we also have a succession planning model that can help facilitate a management buy-out over a period of time,” she says. “We have a few funding options depending on each individual situation.”
Nicholas Faulkner, director at Century 21 UK, says the company offers three models available to meet an individual franchisees’
OurSolomodelisdesigned for experienced agents and offers the opportunity to work remotely on a self-employed basis using the Century 21
UK brand.
Nick Faulkner Century 21
CASE STUDY – EWEMOVE
Paul Chant, Northampton North
“We’re now in a really strong position to keep on pushing our business. The plan
is to purchase another territory and take over all of Northampton. Of course, like with all businesses when owners look
to expand, there is a period of hard work, but we know it’ll pay dividends. EweMove HQ, or ‘The Sheep Pen’, appreciates our position as being the experts within our respective territories.
needs. “Our Max model is designed for franchisees who want a high street presence and provides discounted rates with selected third-party suppliers. Both our Max and Flex model include a five-year territory agreement. Our Solo model is designed
for experienced agents and offers the opportunity to work remotely on a self-employed basis using the Century 21 UK brand,” he says.
Century 21 advise Max agents that they will need over £100k to cover their premises costs, set up costs and running costs for
the first year. Solo agents are advised to have £2.5k as a set-up cost and will need access to approximately £30k as an annual running cost.
Self-employed ‘brokerage’
Ben Littlewood at Moveli says brokerages, unlike franchises, don’t charge a large lump sum to get set up. Moveli is a brokerage that operates in the mid-upper market across London and in prime spots across the country. The cost of joining a brokerage
(or self-employed model) is usually split into a monthly ’subscription fee’ which can vary between around £150-£1,000 a month plus asplitonthecommissiononanydealsthat you might do, he says. This can vary greatly from the agent keeping between 40 per cent to as much as 95 per cent. However, the higher commission models usually charge
a higher subscription fee.
In the UK, however, brokerage models are
fairly new, only a few years old. As a result,
“It’s in the last six months where we’ve realised how big the business has become and that we’re working seven days a week! We’ve got to a point where the business
is very successful and going well, and to continue that growth and maintain our excellent service standards we need to bring more people in.
“EweMove has a solution for us. Franchisees can run an associate model, where we can take somebody on who can benefit from a high commission-based salary which is very low-risk to the business. In this capacity, we’ve already completed 10 property sales in the area that our new Associate is responsible for. If this associate model continues to work well for us and our growing team, the plan is to take another associate on and ultimately step back a bit.”
“I want to grow and nurture my EweMove franchise, that’s for sure.
That means that I will be acquiring another territory and therefore another business.”
We’ve had some impressive success stories, including an agent who went from earning £60k pa on the high street in a job he hated, to banking over £380k in a year.
Ben Littlewood Moveli
commissions offered to agents transitioning
to their platforms was around 80 per cent
to entice agents from the high street over
to the new way of working. Now, it seems that the commission on average has lowered to around 70 per cent for the agent and
30 per cent for the brokerage.
Plus, the other cost to budget for is the
lack of earnings in the first six months of switching to a brokerage.
“At Moveli we’ve had some impressive successstories,”saysBenLittlewood, “Including an agent who went from earning £60k pa on the high street in a job he hated, to banking over £380k in a year. Others include a new starter who listed over 26 sales in his first 9 months and a recent agent who just joined has already banked over £85k in her first two months as a broker.”
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