Home inspection franchises, they are inexpensive to buy, they are inexpensive to operate, but
does it make sense to buy a franchise in this space, and can you make money? We'll look
today at Franchise City
There are a few industries that we get pushback from people because in their mind if you arent
getting a big brand name like McD's there is no value in the franchise model. We get
that with painting, we get it with cleaning, we get it with property management and with
home inspections.
But in these businesses you arent necessarily buying the branding, you are buying access
to systems and processes that if they are good, will make you more effective and efficient
which equals more money. Things like as client acquisition, business operations, quality
standards, efficiencies and dozens of other little things that can help you actually make
more money in the long run even after paying royalties. That's the point of a franchise
but unfortunately not all provide the same value. With a good franchise there is also
a support structure in place if you have questions, or get stuck you can call someone and ask.
And while you may know how to paint and clean,or inspect a house do you know how to scale a
business? Grow a business? Most people do not and thats why we see many independent
inspectors actually converting to a franchise model.
So how does home inspection work. You, or your employee receives training on how to
inspect a house, get certified by one of the governing bodies, then you help people, usually
home buyers, look for potential issues when they are buying a house. Typically will look
at the roof, electrical, plumbing, basement and foundation, walls and windows, and you
can add extra services like mold and radon testing for a fee.
Now the average home inspection not including extras is currently about $315. Many will
charge more for value added services and being the cheapest isn't always the best strategic
market positioning, thats mistake many novice business owners make. But even $315 is not
bad for a couple of hours of work. You might ask how many inspections could you actually
do in a day? I headed over to the Int'l Association of Certified Home Inspectors forum, and the
consensus was you could theoretically do up to 5 inspections a day if you worked ridiculously
hard, no one recommended it because you would have no life, and is virtually impossible
to keep that up, and your quality is certain to suffer, but 5 inspections a day X $315
X 260 working days a year would be $409,500 dollars with one person, not even considering
hiring other inspectors and scaling your business. Because this is a work from home gig your
expenses and operational costs are very low so a decent amount of that gross revenue goes
into your pocket. Now even if you took it easy and did only 2 inspections a day you
are still grossing over $150k a year (163,800)
Before we look more closely at the franchise model let's look at that forum comment again
"I did 5 inspections once this year. It is too many. I regularly do 4 and that is hard
as well. Performing the inspection isn't the issue, it is **producing the reports as you
quickly fall behind volume.
So here is a key distinction, if you have technology that can speed up the reports,
you can do more inspections in a day. And that is the reason people buy a home inspection
franchise, because among other things they have systems and processes and technologies
that help you be more efficient.
When people come to us to help them find the best home inspection franchise, or any franchise,
this service is free by the way we have consultants here that walk you through the process looking
at many factors to find the best for your specific situation. We'll cover a few of those
today. So the first as we just mentioned is the technology. There are companies that have
the ability to complete much of the report right onsite, while you are doing the inspection,
enabling the inspector to do more inspections per day. There are a few other technology
considerations we won't go into here but you want to drill down on the inspection technology
they have, and how much benefit it brings. Does it justify the royalties you will pay.
Next up is customer acquisition. Some franchise buyers gravitate to home inspection because
they like that solo operation, lone wolf in the field, and they might be a bit introverted
and not be very socially outgoing. Which is fine ---if the company is doing lead generation
for you. Some franchises rely very heavily on local networking, so you will need to be
hanging out at Realtor offices, buying donuts, regularly shmoozing to get business. If you
are a people person that's fine, but always make sure the client acquisition model matches
your personality and operational preferences.
Speaking of operational preferences, does the franchise allow for part time operation.
We have many people looking to do a few inspections a week while they still keep their job, do
a couple after work or on weekends, great way to make some extra income. Some franchises
wont allow part time, some will. This allows you to start a business while you are still
working, then once you build up a client base, you can quit that 9-5 job.
Next is training and support. what does that look like. Do they have mentors and trainers
that will help in that critical first 90 day period. What is the experience of the trainers?
Do they include jump start marketing? Really look at what is included. Many people just
buy the first home inspection franchise they look at and might regret it later. Some are
better than others, but that will depend on your specific situation.
Next is territory. So a big decision in any franchise is whether to buy a highly established
or emerging brand. And most people think that is the way to go. There is no right answer.
But while highly established brands might have more established systems and processes
in place, but not always, but with highly established franchises you will often not get your
choice of prime territory, or there may not even be territory availability in your area.
With newer franchise brands you can often negotiate larger territory sizes, and even
potentially operate outside of your territory until they place a franchisee. First thing
we do here is conduct a territory check to see what brands are available in your area
and which are sold out so you arent wasting your time.
Next is strategic market benefits. yes, real estate is booming, yes the home inspection
market is booming, but with that success brings competition. If you will be competing with
many other independent operators and franchises in your territory, and you will, you need
a strategic market advantage. And that can be competitive pricing, faster reports, value
adds thrown in for free, more experience, there are many ways to differentiate in the
market, be sure the franchise you buy reflects the market you will serve. Additionally if
your preference is to scale and grow starting as a one person operation, two, four 8 etc,
you will eventually want to expand beyond your own territory. with highly established
brands that can potentially not be possible.Always consider your future plans.
What does a home inspection franchise cost? Your all-in total investment can be as low
as about $35,000 up to over $100,000. We suggest buyers have realistically have at least $50,000
to invest but each franchise has their own minimum requirements.
Any drawbacks to the business? There are drawbacks in any business, but in home inspection you
need to have a strong strategy for client acquisition, that is the backbone of the business
and if you dont have online lead generation available and arent extroverted you may have
a difficult time. Make sure you have a market differentiator as competition in this space
can be intense. And last but not least, if you plan on running the business yourself,
be prepared to do some dirty stuff not every house will look like this, some may look like
this. You should also be good with heights as you'll be up on roofs. For the right person
a home inspection franchise can be a good fit especially for $400k a year. If you need
help identifying and comparing home inspection franchises, or any franchises our service
is 100% free click above to learn more, please like and subscribe and thank you for watching.