Home-managed franchises grow driven by lower cost
Home based model currently accounts for about 15% of franchising in the country
When, in May 2013, Felipe Buranello and Eduardo Pirré decided to take the cleaning company Maria Brasileira to the franchise model, they imposed a condition: the owners of the units could not work from home.
This is because the partners wanted to professionalize the sector. The company also offers residential and corporate maintenance services.
“We could not run the risk of the customer calling and a child answering or he hearing, in the background, the barking of a dog or the whistle of a pressure cooker”, recalls Buranello, 34, CEO of Maria Brasileira, founded in 2012.
In 2019, however, as the company had already become the market leader and only 10% of the contracts with the end customer were closed in person, he and Pirré, 32, decided to offer the home office format. It worked out.
With a reduction in the value of the initial investment — from about R$ 75 thousand to R$ 39.6 thousand — provided by the new model, the network not only reached smaller cities, but also grew during the pandemic.
Since 2019, the number of units has increased by 73%. Today there are 437, in 373 municipalities in 25 states plus the Federal District — we still need to get to Amapá. The goal is to close 2022 with 500 units and R$ 135 million in revenue.
Maria Brasileira’s transition from a network based exclusively on commercial outlets to a franchise that is mostly home office illustrates a movement in Brazilian franchising that gained momentum with the coronavirus and that, even with the relaxation of restriction measures, continues to rise.
Part of the microfranchises category, whose investments do not exceed BRL 105,000, the format, also called home based, represented, in 2020, 7.1% of the general units operating in the country. The following year, it was 10.3% and, today, it amounts to 14.8%, according to the ABF (Brazilian Franchising Association).
In times of high inflation and economic insecurity, reduced costs and low risk make home-based businesses an attractive business, says Adriana Auriemo, director of relations, microfranchises and new formats at ABF.
The average initial investment in the segment is currently around R$ 35 thousand, with a return between a year and a year and a half. There are, however, home based franchises on the market that are being opened with R$ 1,200.
Today, there are about 600 micro-franchise brands in the country, but there is no data on how many businesses are managed from the home of their owners. The format is the most sought after on the ABF Franchising Portal, with 60% of queries.
One of the great drivers of the sport was the rise in unemployment (or the fear of it) in the severe phases of the crisis.
Married and father of an 11-year-old boy, engineer Rogerio Malagoli, 46, feared being fired from the truck and bus parts factory, where he has worked since 2017. He anticipated a possible job loss, which did not occur, and, In August 2020, it purchased a Brasil Nutri Shop franchise for food supplements and accessories for R$15,000, with 850 franchisees and an investment of R$10,900.
Royalties are charged on top of the value of the product — 20% stays with the franchisor.
With no experience in commerce, Malagoli, who runs the business with his wife, Melissa, was able to quickly form a network of contacts.
Bodybuilding enthusiast, I already knew a lot of people in the middle. Another important strategy was to take its products to two giants of the marketplace —Amazon and Shopee, where 70% of sales are made. The engineer earns around R$ 25 thousand per month.
Affinity with the brand is essential, according to the director of ABF. As the home office format is focused on the entrepreneur, it is important that the sector and type of work are suited to the personality of the entrepreneur. A requirement of Maria Brasileira, for example, is the franchisee’s disposition for interpersonal relationships.
That’s not a problem for nutritionist Denise Lapa, 50. About six years ago, she bought a Maria Brasileira franchise from her now-husband, Rubens. With social isolation, she was forced to hand over the office, dismiss the attendant and adopt the home office format – which guaranteed her a monthly savings of R$ 2,000.
At first, it was not easy to adapt the company to the routine of the house, where the couple, their 19-year-old daughter, a cat and a dog live. The interruptions took away from Denise’s concentration.
Gradually, everything fell into place. She set up a “corner” for the company in the apartment and took the team’s training to the building’s party room. Under her command, 18 employees perform 12 calls a day, which guarantees her monthly revenue of around R$40,000 and a profit of around R$15,000. The royalties charged by the brand range from R$606 to R$2,424.
There are two other points that home office franchisees should pay attention to, says the director of ABF.
The first is not to mix the finances of the individual with those of the legal entity. “And it also takes discipline both to work when you have to work and not to work when you don’t have to.” Business and mental health will thank you.