Letting or Estate Agency Franchise
Find out how much a letting or estate agency franchise costs, and compare this with the Southcourt Letting and Estate Agency Business Package
Case Study: Franchise or Freedom
It is well known that if you want to be your own boss and start a low risk business, one option is to buy a franchise from an established business with a track record of success. Franchises can be bought for a wide range of business types from burger bars, shops, cleaning companies, estate agents to oven cleaning services. But is a franchise the right choice for you? In the lettings and estate agency industry there are alot of letting agents and estate agents offering franchises.
What is a franchise?
A franchise is an arrangement where you enter into a long term licence agreement with an established business to use their trade name, products and services. They often provide an entire system for operating the business that includes processes, operating manuals, software and sometimes premises.
They effectively sell a ‘territory’ version of their own business. This means that you are usually restricted in your business activities to operating in one town and cannot accept clients outside of that area. There are often significant disadvantages with running a franchise that restrict your growth, and some of these disadvantages don’t become apparent until well after you’ve started.
So we don’t sell franchises.
A lettings or estate agent franchise doesn’t come cheap. You will typically spend thousands of pounds JUST on purchasing the right to operate under the franchised business name in a defined territory. Then once you’ve put in all the hard work to get the business up and running, you will pay a fixed percentage of your monthly turnover in commission or ‘royalties’, and often for further costs such as ‘group marketing’ fees. These can be a real drain on your bottom line profit and limit the potential for extraction of funds from your business for yourself, thereby limiting your salary. After a while you might start to question your sanity!
Secondly, when you purchase a franchise you are locked in for a lengthy period, and are forced into an onerous full-time commitment, where your work-life balance is of low priority to the franchisor. Once that period is up, you will be obliged to pay a further fee to renew your licence and continue trading. Most franchise companies also insist on an unnecessary and expensive high street office, which adds significantly to your costs. With 90% of lettings business conducted online, provided you have a professional website your small business will be as visible as a major franchise outlet.
Thirdly, across the UK there is no single brand of agency franchise provider who stands head and shoulder above the rest. So doesn’t this negate the whole purpose of a franchise? For example, your letting agency could be called ‘Yorkshire Lettings and Sales’, and this would have equally as much chance of gaining clients as anyone else, even the big boys. You can test this by simply searching for properties in your area on Zoopla – if you find a property that you like, why would the name of the agent make any difference to your decision to view it? Think about it.
” Setting up with our low cost business package will give you freedom of choice. Freedom to operate your business either part or full-time, and from home or office just as you choose – but with the support of an established organisation like Southcourt. These are options you simply do not have as a franchisee.“
With 45 years combined experience under our belt, we know the lettings and estate agency business inside out. Our business start-up package provides step by step training and takes you carefully through the various processes involved in running your letting agency. We reveal tricks of the trade and clever ways to acquire new business, as well as providing the essential tools you will need, including software and a modern website.
We show you how to operate your business either full time or part time, from office or from home. In our Support Centre (www.southcourtsupport.com), in addition to our telephone and email support, you will be able to utilise the services of our chosen trading partners, including tenant referencing, EPCs, rent guarantees, deposit replacement warranties, PAT testing, inventories, furniture pack suppliers, and much more.
In fact, we provide everything you will need to start and grow a lucrative lettings business from scratch. What’s more, our business package costs just a few hundred pounds including your own fully operational property website. Compare this to the cost of a franchise and you can see why Southcourt Property is one of the largest networks of agents in the UK.
” We firmly believe that if you’re looking to start a letting agency, you should not spend a penny on a franchise. If you value flexibility and independence, and the opportunity to truly be your own boss, you should be looking at the Southcourt Package.”
|Southcourt Business Package||Franchise|
|Cost||The Southcourt Business Package is a fraction of the cost of a letting agent or estate agent franchise. You should recoup your outlay with your first one or two customers. You can operate part-time or full-time depending on your circumstances and requirements.||A franchise will cost you several thousand pounds just as an purchase cost. We consider this to be exorbitant and totally unrelated to the perceived benefits offered. It also excludes those wishing to set up a letting agency on a part-time basis, or as an add-on to an existing business.|
|Independence||Unlike a franchise, it’s entirely up to you to decide how much time you wish to devote to the business, and how you wish to run it – you’re in complete control. No-one is breathing down your neck, but you have support when you need it.||You will have none with a franchise. You will feel more like a manager than an owner. You will be restricted by set rules, with little chance to vary or develop your business.|
|Ongoing Payments||Unlike a franchise, you keep all your earnings, and pay us NO COMMISSION CHARGES WHATSOEVER – you keep 100% of your profits. The only ongoing payment to us is your website hosting and software (see pricing).||With a franchise you will be obliged to pay a monthly commission on your turnover of around 10 to 12%, this figure increasing as your business grows. On top of this you’ll usually pay for software, and other operational costs to fund “head office” – usually several hundred pounds per month|
Setting up a letting agency or estate agency can be achieved by using our top rated and proven business package with ongoing support. No qualifications are required, and you can be up and running within days, working from home or office, and either part-time or full-time.
If you aspire to run your own letting agency or estate agency, you can start up as a new venture, or as an add-on to an existing business. With Southcourt Property you have the opportunity to do so with the full support and huge experience from a company who has successfully started over 1000 agents.