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11th January 2012

Martin & Co to buy franchises

Martin & Co has announced a new strategy, with its head office embarking on a purchase of franchisees' businesses. The firm said it has ambitions to be its own biggest franchisee.

 

Ian Wilson, managing director of the franchise lettings chains, said: “It's the strongest possible signal we could be sending that we believe in the power of our own brand and in the long-term prospects for the UK lettings market by investing our own money in lettings businesses.”

 

He added: “By guaranteeing our franchise owners a fair price for their business at the time when they want to sell, it de-stresses the whole sale process for them in these uncertain economic times.”

 

The first office it has bought back is in Worthing. Another four purchases this year are planned. It is the second shift of strategy in six months. Martin & Co operated a high street-only model until last summer when it started offering online franchises. It says it has so far recruited 14. This latest strategic direction shift means that Martin & Co will now be trading as a letting agent in its own right.

 

Wilson said: “Well-run lettings businesses lack a 'reverse gear'. We are very much looking forward to controlling our own offices directly and deploying all of the head office expertise and best practice know-how at our fingertips to increase their revenue and profitability.”

 

He said Worthing became an obvious choice, as it is reasonably close to Martin & Co's head office in Bournemouth and because the timing was right for the franchise owners.

 

Martin & Co franchise director Scott Burgess said: “It can be a stressful period for franchise owners if they are ready to sell but do not have a buyer waiting in the wings. We could offer a fair price, and because we were funding the deal from cash reserves we could work to the seller's timescales, without worrying about whether the bank would approve funding. Ultimately we want to be the biggest business owner in the group as well as being the franchisor.”

 

Wilson added: “Lots of large corporate chains are trying to acquire lettings businesses to consolidate their market position but they have to continuously search for acquisition targets and then complete extensive due diligence because they don't know the provenance of the business concerned.

 

“We already have 180 businesses of known provenance and 27,000 managed properties on our books so are confident that our acquisition programme can be scaled up as quickly as funds allow.”

 

Giles Mugford, Franchisee of the Camberley branch said; “Every business has an exit plan, and although I plan to be in business for a long time, it's welcome that the Franchisor has made the selling process easier.”