Episode 2: Trent Huey – Neighborly Franchises Mr. Electric, Mr. Rooter, and Mr. Appliance

Welcome to another episode of The Franchise Business Radio Show powered by the franchise sisters and sponsored by their company, franchise intellect, a consulting firm that provides knowledge of the franchise community and thoughtfully aligns aspiring, ambitious entrepreneurs with the right franchise. Investigate before you invest by contacting the franchise sisters.

Welcome back to another episode of The Franchise Business Radio Show powered by the franchise sisters. This is Pam curry, along with my co host, business partner and sister Sherry curry.

The Franchise Business Radio Show was designed to be a platform to educate and bring business professionals together to serve aspiring entrepreneurs looking to invest and operate a franchise. I’m excited about today’s show. Sherry, as you know, we are not going to be discussing just one franchise brand. We are going to be discussing three franchise brands. I know Pam, it’s very exciting. And I am also excited to welcome and introduce our guest today from neighborly. So neighborly is a network of 19 plus distinct home service franchise brands. And our guest today, Trent Huey, is going to be sharing about three of those rams, Mr. Electric, Mr. Reuter and Mr. Appliance. Welcome Trent, glad to be here. Thank you all for having me. We are thrilled to have you. But before we dive into any questions, I’d like to share a little bit about you to our listeners. So Trent is the Vice President of Development at neighborly, a role he has held since October 2020

prior to this, he served as Director of Development at Mr. Electric. Trent began his career at Halliburton as a service supervisor from 2020 12 to 2016 and worked abroad and domestically and the USA.

Trent earned a bachelor’s degree in education and Earth Science from Baylor University and obtained his certified Franchise Executive certification in October 2022

so again, happy to have you on the show. Trent, glad to be here. All right, so let’s start at the top. Tell us about neighborly. Oh, goodness. Where to start? How much time do you have?

Like you said, neighborly is the world’s largest home service franchisor with 19 different service verticals. We have 32 overall brands, but 19 service verticals in the United States, and we’ve broken those down into three different cluster clusters, the repair cluster, the enhanced cluster and the Maintain cluster. And so the three brands that I oversee are in the repair cluster, Mr. Electric, Mr. Ruder, Mr. Appliance. And as you can tell by the name, they repair things are broken, something’s messed up, and they come in and fix it. Mr. Handyman is also in our cluster, along with glass doctor, air serve

and precision garage door service as well. But specifically the three that I oversee, Mr. Electric, Mr. Appliance and Mr. Rooter.

Okay. I love that. I never do that. I like that the repair cluster, the repair cluster that says it all. Well, Trev, why don’t we do this? Let’s go ahead and start off. Kick off with the brand that you represented when you first started with neighborly. Could you help explain this, what I call essential trade business model, mystery. Electric, absolutely. So I was very fortunate to come to a brand at neighborly that had seen, you know, very slow growth and the mindset of Mr. Electric really changed about 1011, 12 years ago, when we realized that, hey, electricians are very good at what they do, but electricians sometimes are not the best business owners. So Mr. Electric started testing out. Hey, let’s get a business owner into this who’s not an electrician, can’t get in a truck, can’t hang a ceiling fan and see how well they do. And sure enough, that model has proved out very successfully, you know. And a lot of our most successful owners nowadays, or have never been in a truck, can’t do electric type work. So the type of work that we’re talking about is any type of service work. Hey, this plug is not working. Hey, my ceiling fan is not functioning properly. To hey, I need solar panels on my house, or I need a generator, or I just bought an electric car and I upgrade my panel. Or what everybody’s favorite is smart home technology, connected home. They want to be connected to their home, you know, wherever they’re at across the world, across the globe, they want cameras up. They want to be able to control everything from from their their smartphone, tablet, computer, wherever they’re at. So any of that type of work, additions, you know, like electricity, touches every single corner of every room that we’re in. So it is a it’s around us, and people want more of it. Well, you aren’t Q.

Anything when electricity goes down, everything shuts down. Julie does, no doubt. Well, obviously you have a couple of Mr. Brands in the repair cluster. You mentioned them, but let’s talk about two others, Mr. Rooter and Mr. Appliance. Explain those brands to us. So Mr. Ruder is exactly what it is. It’s our plumbing franchise. So basically, take the word electric out, put Rooter, and it’s a plumbing franchise. So they, they come in and focus on, hey, this toilet is not working. My faucets leaking. I need a new hot water heater. Or, like, what Mr. Ruder is getting into now is the main line process. Hey, my line is clogged all the way out to the city, to where the city connects, or backed up to my sewer, and there’s a crack in it, we need to fix it. So Mr. Ruder focuses on the plumbing side, and then Mr. Appliance is exactly what it says it is. They fix appliances. So what’s neat about Mr. Appliance is it is the only appliance repair franchise in the United States. There is not another one. It is the only one. And what’s neat about Mr. Appliances, it’s the heart of the home. You know, think about going home and your dishwasher not working, your washer or dryer, refrigerator, your oven. That’s the heart of the home. That’s where people gather to eat, spend most of their time together, is in the kitchen. And when an appliance isn’t working, it causes problems, and Mr. Appliance can come in there and fix them. Oh, I’m feeling that pain right now. Just had to fix the refrigerator. The washing machine isn’t working well, and I’m going to hand it over to Sherry, but I’ve just got to give you one quick plug here. Trent, I think neighborly and some of your marketing materials are just off the chain. I’ve seen busses go by here in Charleston with the Mr. Rooter wrapping and I always laugh, and I love it every time it sticks out. Yes, it does. It does. And I know you guys are developing even more that marketing and how you guys can kind of unify underneath the neighborly brand to service every aspect, like you were saying, plumbing, appliances, electric, so on and so forth. And I’ve had a Mr. Appliance in my home as well because of the dryer. And let me tell you, I needed him there right away, because we do a lot of washing in my house right now.

But okay, so these trade industries have been around for a long time.

So I think one question our listeners might want to understand is, what does is the growth? Is the growth stagnant? Is it? Is it increasing? What’s the demand going on when it comes to this type of service that’s needed. Yeah, you know, the demand we’re seeing specifically for the electric one is, and it’s the number that I know is they’re seeing year over year growth of about eight to 7% total across the board, which is just phenomenal. And it’s in the two hundreds of billions of dollars amount of revenue that’s in the electrical industry. Same with the plumbing and same with appliance repair. You know, nowadays it’s cheaper to have your appliance repaired than it is to go buy one. They’re full of electronics. You can they’re they’ve got Wi Fi in them. Now, you know, so most people will spend up to half the cost of an appliance to get it repaired before they will go buy a new one. So, yes, this, this industry is growing. It’s more needed, more needed than ever, and that’s exactly what I did. I got my dryer fixed. He was great. He was very professional. He got the job done there. He had everything he needed. So it was it was a turnaround really quick, which I really appreciate it. But um, so Okay, so we know the growth is there. We know the demand is there. So let’s go ahead and get into the Franchise Disclosure Document, that favorite document that we all love, also known as the FDD, super intimidating and big, but super important for anybody who’s considering franchise ownership to look at in detail, because it really explains everything you need to know about the business and what that partnership is going to look Like between you and that franchisor. So we’ve got 23 items in the FDD. Item number seven is one that is always reviewed up front. And the reason why is it talks about the investment range for the brand. And what I like about item seven is it really breaks it down. It line items out everything you’re gonna need to invest in in order to get those doors open and start running your business. So how about you share a little bit about the item seven for your brands? Absolutely. So Mr. Electric item seven runs between 150 to $280,000

depending on the size of the territory you’re looking at. Mr. Reuters going to be a little bit more expensive because there’s a little bit more equipment that you need from that standpoint. So it’s running from about 180 to about 350 and then Mr. Appliance is a little bit on the lower side. There’s not as much equipment. Your vans are smaller, you know. So Mr. Mr. Appliance is running the range of about 115 to about 230,000

in available capital that is needed. So in our fdds, you know, neighborhoods been around a long time. They really got that part figured out so they really lay everything out. You know where it needs to be, how much you’re looking for in terms of whether you’re doing Rob’s SBA self financing, whatever you’re whatever you’re looking to do. No, no, that’s great. I’m really glad that you brought up Rob’s SBA self financing, because we’ve got those investment ranges, like you said. But there are ways to do.

Have a wise funding strategy to get those doors open, and certainly we can share with anybody who’s coming to us, you know, strategies that would work best for you as a franchisee. So thank you. Yeah, great. I always want to have a wise funding strategy for any business that you’re getting ready to invest and operate.

Since we’re on the topic of the Franchise Disclosure Document, probably one of us talked about items in the FDD

is the item 19, and the item 19 stands for financial performance representation. Not all franchisors provide data points in the item 19. Could you share what data points you offer across the three brands, absolutely. So two of our brands do average revenue. So Mr. Electric is about 1.1 million average per per territory, 1.1 point 1 million in revenue. Mr. Rooter is about 1.8 million in revenue per location. And then Mr. Appliance does a little bit different. They do it by average service ticket. And Mr. Appliances is average service ticket is right at $261

per job that they go out and complete.

I think

that’s what I paid. I said. I think that’s approximately

every time I’ve

had, yeah, every time I’ve had them come out, it’s been between 240 and 270 just about every single time.

That’s great,

you know. And just, I think, an interesting point that you just made their trend is that when someone is looking at the item 19 in the FDD, it gets laid out differently by every single franchisor. So it’s just getting in there and studying it and understanding how those data points are being laid out. It is, and neighborly does a great job, especially with all of our brands. But with electric and Rooter, especially, they break it down into the bottom 10% top 50% top 25% so you can see the the tiered levels. You know, we get asked all the time, you know, why are people in this bottom 10% Well, you know, they’re either not actively running the business, they’re not following the systems, doing those types of things. And you know, when people start asking about the top, the bottom 50% I’m like, Why do you see yourself in the bottom 50% we’re looking for people who want to be in this top 50, top 25 top 10% we’re looking for those leaders that want to come blow this thing out of the water, but there are people that get into franchising that just don’t follow the systems, and it’s just that’s why you got some some in there that are below that 10% range. And you may have already answered this question then, because I was curious to find out, who are you looking for as franchise owners? Is our particular profile for the different brands? Is it the same across the brands? I’d say the profile is can be very diverse, but we look for three key trades, and I think that’s what’s very, very important in this. You know, can they lead a team? So they led a team in the past, from two people to 10 people or bigger. Can they follow and execute a marketing plan, and can they manage numbers? So we’re really looking for those three key traits, and those traits, we’ve got successful owners who are engineers, they are CFOs, they’re CPAs. They worked in the oil field. They were VPs of sales. They were former business owners. They currently own another business. Some of them are serial entrepreneurs. This is just what they do,

from that standpoint, but, but I’d, I’d say you’re looking at someone that is very well versed in just leading a team and being out in front of people and not scared to to talk to people. I think that’s one of the biggest things. Just not scared to talk to people. You gotta remember, when you’re in the service industry, we’re not in the transaction industry, we’re in the sales industry. Even though it’s service, it’s you’re in the sales, but you’re selling, you know, you’re selling trust, you’re selling loyalty, you’re selling commitment to that job so that someone feels safe in their home.

Yeah, and I think that holds especially true for the trades, you

know, because it is a heavy investment. And you’re right, you’re coming into someone’s home, which is very personal, absolutely. So that makes a lot of sense for me, you mentioned something earlier, and that is basically that in every franchise system, there’s hit there is what I call performance gap, right? You have your top performers, your middle performers, your low performers. What? What qualities do you see in your top franchise owners? First off, they’re not scared to ask questions. And I think that’s key with anything. If they don’t understand something, they are not scared to ask or, Hey, I’m seeing this. I need help. You know, hey, I need help here. And they’re not scared to call other owners and say, Hey, what did you do in the first six months that helped you be successful? They go to training, they go spend time with the other owners. I mean, that’s one reason why you get into a franchise system, is that these systems have been proven successful over and over and over again. Now, how you directly implement those systems into your business may be a little bit different, but the root of those systems is there, and it’s there for a reason. So go spend time with the owners and see what they are doing to be successful. Call them and say, Hey, I need help on this. So I think that’s the two biggest things.

Is, take take the owners up. I’m going to spend time with them, and don’t be scared to ask questions and ask for help. Yeah, now that’s a that’s a great thing to remember. I think people, when they get into franchising, they forget the whole point is, is you’re in business for yourself, but not by yourself. That means you reach out to you reach out to corporate, but talk to your other franchisees who are also doing the exact same thing you’re doing every day, and see if they have some, you know, suggestions on how you can get better and better and kind of mirror whatever it is they’re doing. So it’s, yeah, the access to people, and executing that access is really important.

I’d be remiss not to miss this question, because we always get it. I know you said earlier that, you know, I think it was 1012, years ago. You took Mr. Electric and said, You know what, we don’t need an electrician. We need a business owner. But let’s face it, Anytime somebody’s reviewing these plans, they need to. They want to understand how does that work? Is there licensing requirements? Who holds the license? Because I’m not an electrician, so can you kind of explain how a licensing piece works for these types of brands? Absolutely. So Mr. Electric and Mr. Reuter do require a qualifying license. But there’s three ways that we show this candidate, this new owner, how to acquire the license. First off, we’ll look in house at other owners to see if they have a license that they can use to qualify the business. Two, we’ll show them how to hire the license, where that person comes to work full time in the business. Or three, well, we have resources to where they can actually find a license, and we call it leasing a license, but they’re paying this person, consultant type, money, to use their license to qualify the business. So there’s three ways that we go about doing that for those two brands and Mr. Appliance. The only state that requires a license is California, so there’s a small license that is needed for California for Mr. Appliance. But other than that, there’s no license needed for Mr. Appliance, and Mr. Appliance actually has the training for service professionals. So there are, there are avenues to where you can hire someone. They can get the training to go fix the refrigerators, Disher, dishwashers, washers, dryers, you name it, so they can go in people’s houses and perform the work. That’s great to know. I did not know I did not know you didn’t need a license for Mr. Appliance, except for, frankly, state, California, yeah, just California. And I love how you support you have a clear path. It’s just based on the frame. The person who’s getting in the territory what path they want to take. But you guys will guide them and coach them through whatever the path is. It works best, absolutely. Yeah, whatever’s best for them. You know, if they talk, if they talk to 12 owners, six of them might say Lisa license. The other six might say, hire the license. It really just comes down to to what you want to do as the business owner and how you want to proceed. Okay, good stuff. Alright. What have we missed? What else would you like to share? Anything regarding neighborly or the brands? You know, I think the biggest thing is just the fear over Hey, I can’t go perform electric work. I can’t go perform plumbing work. Or, hey, I don’t know how to fix appliances. Well, if you look at anything else, you don’t know how to do it. Either you don’t have to run a hotel. You don’t know how to run a Chick fil A, you don’t know how to run a hot work. So you don’t know how to do that. What makes this any different? You know, I will tell you this. The the least sexy businesses are sometimes the best. These aren’t sexy, but they got teeth. Let’s just, let’s just say that they’re continuing to grow. They’re essential with everything that we need. So focus on the long term growth of the business, and not what is just hot at this moment. Think long term 10, 1215, years from now, what is recession resistant, what’s essential, what’s needed, what’s not going anywhere and what is always going to be needed. You’re always going to need electricity, you’re always going to have to have your plumbing fix, and you’re always going to have to have your appliances working. We know those three things

definitely. And thank you so much for sharing. And welcome. You’re just wealth knowledge. Trent just great information. What I like to do is kind of wrapping up the podcast. I like to ask this closing question, and that is, what tips would you give to aspiring entrepreneurs?

I would say the biggest thing is, everybody is fearful when they get into business. Trust your fear. What I have found in doing this for 19 years are the ones that I want to say were the most fearful, but can say that they were feel fearful, were sometimes the most successful because they did not want to not be successful. It was the ones that came in be like, Oh, I got this. No worries that you know, weren’t the most successful. So acknowledge your fear, say that you’re scared, and go and act on it. Go, take take charge of it. So that’s one of the biggest things that I’ve seen. Get over that fear, go, take charge of it and be successful. Great tip, yes, sometimes you have to use that fear to put a little fire in your belly and to motivate you. If you channel it properly, it can be a positive.

Absolutely, yeah. And I always like to say, but you don’t want fear to be your decision making. No, never, ever. Everybody who’s gotten into business has been fearful. Everybody. I mean, there’s not one person who has gotten into business that said, Hey, I’m not, I’m not at least a little bit scared. Everybody’s fearful. I like to say, to tell people, you know, what, if, if you don’t have some degree of reservations, I’m a little concerned, absolutely, a long time on the phone, like, if you’re not scared, I’m scared, I want you to absolutely yes, I agree. Well, thank you again for being a guest on the show trend, and definitely enjoyed having you on the Franchise Business Radio Show, and to our listeners, if franchise ownership is something you’re considering, contact us here at Franchise intellect.

So we’d like to give you a free ebook top 10 Questions to consider before investing in a franchise, and we would be happy to schedule a free franchise consultation call with you. Our goal is to pay it forward to aspiring entrepreneurs and provide franchise insider knowledge and coaching. We like to say, investigate before you invest in a franchise. That’s right. The goal is to put you in a position to make a wise franchise decision, dodge costly mistakes and achieve financial independence. It’s easy contact the franchise sisters at Franchise intellect. Thanks for tuning in. This is the franchise sisters on the Franchise Business Radio Show. Signing off this bump you.