How To Start A Home Improvement Business In The UK

Discover how to start a home improvement business in the UK by choosing the best customers to target and the right profitable franchisor to connect with.

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Home improvement can be a very profitable business, but it's not easy to know where to start.

There are many home improvement businesses out there, but not all are created equal. You could waste a lot of time and money if you don't do your proper research first.

We've written this article to help you discover the best way to start a home improvement business in the UK. By following our advice, you'll hit the ground running and connect with the most profitable franchisor for your needs.

Contents

• Why owning a home improvement business is the right choice
• Check that you have the necessary skills
• Choose your home improvement sector
• Choose the location of your franchise territory
• Devise a market study and a realistic and thorough business plan
• Choose the legal status of your home improvement business
• Take out the necessary insurance
• Next steps in starting a home improvement franchise?

Why owning a home improvement business is the right choice

Home improvement sector overview

The home improvement sector in the UK is worth 14.5 billion pounds, with 3.8 per cent growth thus far in 2022. [ibisworld] Furthermore, home improvement is split into new build properties for private, public and commercial buildings accounting for 57 per cent in the UK. Where Repair, Maintenance & Improvement (RMI) is the remaining 43 per cent. [Insightdiy] However, RMI is growing more rapidly than newly built houses and the reason is found in the sector trends below.

High housing prices encourage people to move less and focus on their homes

The home improvement sector follows the trends of the real estate industry. If housing prices increase, fewer people change houses and subsequently focus on improving their living situation with an extension, repair, new kitchen or bathroom. Thus, as housing prices have soared in the past decade - due to low-interest rates - Brits are less likely to move houses than ever before. Similarly, most people's finances are tied to their homes as well, encouraging people to invest and improve their homes to inadvertently improve their wealth.

Covid-19 pandemic made people realise the importance of our homes

Similarly, as opposed to many other industries during Covid, the home improvement sector grew in 2021 by 6 per cent. The reason is that we realised the importance of our homes after Covid-mandated lockdowns, making us spend more time at home. For example, the open-plan kitchen and living room saw a substantial increase in popularity.

A more extreme climate means increased demand for home improvement

With the steady increase in extreme weather in Britain, more Repair, Maintenance & Improvement are needed. In some sense, some home advancement businesses are cyclical, following certain weather patterns such as new roofs and roof repair increases after several storms hit the UK.

Check that you have the necessary skills

Before deciding to jump on a home improvement franchise opportunity, you must determine if you have what it takes and the motivation to succeed.

Do you like working with your hands?

Achieving success and financial freedom in home improvement comes from a well-crafted business plan (which we will get to). But your long-term, consistent success comes from your motivation. You will be your own boss, and while a franchisor will guide you on the right path, ultimately your success is in your own hands.

Your hard and soft skills should reflect the industry

Additionally, the home improvement subsector you ultimately are going to choose should reflect where your skills and passion are located. If you lay awake at night thinking about kitchen designs and innovations, then the kitchen subsector is the one for you. Similarly, if you are used to working with your hands and love fixing things around the house, the home improvement sector is right for you.

A tip here is to list your skills in the order you like to do them the most. This will help you immensely in finding the right home improvement subsector for you.

Choose your home improvement sector

In the same context, choosing the right subsector means assessing the home improvement options available to you. So go over each subsector, and figure out if they are the right choice for you. Here are three thriving subsectors to consider.

Start a Kitchen Business

The kitchen is the house's beating centre, and the development of kitchen retailing, as well as installation services, is a reflection of this significance. On Point Franchise, kitchen franchisees have seen impressive growth. In fact, the kitchen and bathroom business is growing at a rate of 5% yearly, despite other industries struggling.

Start a Gardening and landscaping business

From an increasingly busier modern lifestyle, Brits are seeking landscapers for their garden health and maintenance. In addition, as our population ages, gardening has increased in demand due to the hard work gardening is. This demand is further exacerbated by an increase in awareness of nature and subsequently the importance of our gardens. It has never been better to join this cyclical business as our seven landscaping franchise opportunities show in their results.

Start a General Home Repair business

With the growing popularity of house renting in the UK, general home repair has seen a remarkable rise in value with a £54.5 billion valuation. A home improvement franchise in this subsector offers steady work, repeat customers, and plenty of referrals.

I recommend listing the subsector that you see as most desirable and that matches your skillset. This will help you devise if there is available territory for a franchise in your area.

Choose the location of your franchise territory

Franchising means you are gaining access to the rights of a franchisor's profitable business model, branding, and network. Because of this, you need to figure out if your business should be closer to home, or if you don't mind a long commute: maybe even if you want to manage everything remotely.

For example, plumbing and general repair require a van to cover an expansive franchise territory. Oppositely, a kitchen and bathroom franchise means you will have a physical showroom to meet customers that generally only covers part of a county. This will help you locate the right franchisors is what they offer in the area you have decided on and narrow down the market research you are about to embark on.

Devise a market study and a realistic and thorough business plan

Who will be your customers?

Now that you have chosen a list of subsectors you would enjoy and that match your skill set, and a list of areas that you would be able to operate within, now is the time to open Google and do some research.

First, compile market and economic data for the areas you have chosen. For example, how many businesses are there in your area? What types of businesses are they? For private homes, are they young professionals or elderly seniors? Does your area have a high or low disposable income?

These questions will lead you to who your customers will be. See if you can divide them up into three groups:

1. Customer group A will bring in the most revenue
2. Customer group B brings in less revenue but is growing rapidly
3. Customer group C is small in size and hard to get repeat business from but is valuable to have nevertheless.

Craft a winning business model

Using the information you have up until now, find a business model template that works for you. I recommend Business Model Canvas and begin to fill in the empty spots. No matter the business model you are crafting, see if you can find synergies between your customers and the products you will be offering.

This will help you immensely in your conversations with franchisors.

Choose the legal status of your home improvement business

In some respects, a franchise will make your life easier with choosing the legal structure of your business. In fact, some franchisors will have a requirement to be registered as a certain type of business. So always remember to read the FDD, or Franchise Disclosure Document!

Many franchisors let you freely choose what legal structure you wish. Here is a quick breakdown of each legal status in the UK:

• Sole Trader: Like its name, this legal structure is suited for the one-person team. So if the business is contingent upon your skillset, this type is best. However, unlimited liability may pose a problem for you in taking on debts, and it is generally harder to find financing for Sole Trader companies.
• Partnership: A Partnership business is similar to the Sole Trader but with multiple people. This type is best if you have people that would enter home improvement with you with different skillsets. Similarly, in a Partnership, you also share the financial burden.
• Limited Company: Works as a separate legal entity from its owner(s). This means that debts incurred cannot impede the owners' credit or personal finances. It is likely that owners' will have to give personal guarantees. While managerial and legal costs are higher in setting up a Limited Company.
• Limited Liability Partnership (LLP): An LLP is a combination between a Partnership type and a Limited Company type. Essentially, a business entity is created on its own, where each partner is only liable for the money they have put into the business.

Take out the necessary insurance

Similarly, insurance for your business is paramount. So here are the two insurance types to consider:

• Professional indemnity insurance helps you in client compensations, such as property damage.
• Public liability insurance assists you in covering public claims made against you.

Next steps in starting a home improvement franchise?

If you have come this far, you are definitely interested and ready to start your own home improvement business. In which case, sit down and do some research, draw up a business plan and begin to contact franchisors in the area you wish to operate. You've got this!

Afterwards, check out our home improvement franchises to begin your search for the right franchisor for you.