Property has proven to be a very tricky market to get right in the last couple of decades, with shaky economic circumstances driving many estate agents out of business. But, thanks to some astute decisions, one estate and lettings franchise, Pearson Ferrier, has gone from strength to strength.
Mitchell Pearson, the company’s co-founder, has always been something of a self-made man: not long after leaving school, he started to look for opportunities that would allow him to own his own business. “My family had brought me up around horses so we’d always been cheek to jowl with farmers,” he says. Because of this, in 1982 Pearson bought a milk round, something that over the next 11 years taught him many of the disciplines involved in running his own business, from time-keeping to customer satisfaction. Unfortunately, he eventually found the work was taking its toll. “I was working very early mornings and, in some cases, quite late at night; it was really getting on top of me,” he says. “So in 1992 I decided to sell everything.”
Looking to put the capital he’d unlocked to work, he began to buy property through a local branch of Nationwide, the estate agents, something that brought him into contact with its manager Julian Ferrier. “He had a great track record in the business and we struck up a friendship,” Pearson says. Having added a few properties to his portfolio, Pearson began craving a more active role. Attending an interview for a sales negotiator position at Nationwide he’d seen advertised in the local paper, he once again found himself sat across a desk from Ferrier. “I became his understudy at Nationwide,” he says. “And we worked well together.”
Before long though, London started calling for Ferrier. “He had a change of heart and decided that the Smoke was the place for him,” says Pearson. Consequently Pearson found himself managing the Nationwide office until local businessman Bill Howard offered him the chance to enter into a partnership, an opportunity he jumped at. “The corporate ladder I was on wasn’t really my scene,” explains Pearson. “I’ve always been self-employed and in charge of my own destiny.””
When Howard and Pearson came to open an office in Ferrier’s hometown of Ramsbottom, he was the natural choice to take the helm as manager. “And, not long after that, Julian and I decided that we should buy Bill Howard out,” he says. “That’s how we formed Pearson Ferrier.”
And the business took quite a different approach to its contemporaries; the duo decided to buy a local lettings business, something that was fairly uncommon for estate agents of the time. “They were resistant to lettings agents,” Pearson says. “They saw it as a problematic market and a poor relation to estate agency.” For a time, it seemed like the naysayers would be proven right: despite having a local portfolio of 50 houses and putting out adverts in the local press, very little happened for weeks. “Then, all of a sudden, a lightbulb came on and the buy-to-let boom began,” he says.
From here, Pearson Ferrier began seriously ramping up its growth. By 2007, it had opened seven offices employing 50 people and was planning to open around four locations a year for the next five years. “The future was mapped out for us and we weren’t looking back,” he says. “But then the recession hit.” This required the founders to make some very tough choices and they decided to scale the business back to four offices. “I’m very glad we did because the recession bit hard, bit deep and lasted much longer than any of us had expected,” he says.
It wasn’t really until 2013 that the market began to show signs of recovery, thanks in no small part to the launch of the government’s Help to Buy scheme. Pearson Ferrier decided the time was ripe for expansion once more. “We were still young and ambitious enough to move forward,” Pearson says. “After all, anybody who sits still really goes backwards in this market.”
However, one problem the business had run into during its previous expansion was the question of motivation: it was hard to properly incentivise employees and ensure their interests were aligned with those of the business. “We thought it would make sense to have someone who had a vested interest in each office that they opened,” he says. “And it wasn’t long before the word franchising came up.”
Despite its lengthy track record in the estate and lettings market, the founders were eager to make sure that the business would lend itself well to a franchised model. “We wanted to be working above board and make sure our brand was franchiseable,” says Pearson. To that end, Pearson Ferrier sought out the assistance of The Franchising Centre, which guided it through a rigorous testing process and helped the founders round out its model. Before long, the franchise had signed its first franchisee in Bolton and many more followed after. “The first two or three are the hardest,” he says. “But, as the brand grows, selling the service becomes easier.”
Pearson Ferrier has a specific set of criteria to help identify which franchisees are most suited to sit at the helm of one of its franchises. “It’s not an easy business; there’s an enormous amount of competition,” says Pearson. “But if you are committed, prepared to work hard and willing to integrate yourself into the local community, then you can make a success of it.” While past experience of the industry isn’t necessary, having professional contacts in the area can prove very valuable indeed. “It also helps if people have been self-employed before so they are aware of the ups and downs of running a business and the fact that it isn’t all cakes and ale,” he says.
But franchisees aren’t just left to face things on their own: Pearson Ferrier has a comprehensive programme of support to help new recruits get up to speed. “Prior to the opening of the office, we immediately go down to the area to start a marketing campaign,” Pearson says. By helping them to get the word out using the local press, flyering and going from door-to-door, Pearson Ferrier helps ensure franchisees have a healthy customer base from the off. “On opening a new location, we will stay with the franchisee and have onsite training for at least two weeks,” he says. “And, afterwards, we are available via Skype and are able to go back down to an area at various times over the next six to 12 months.”
Thanks to this, Pearson Ferrier is going from strength to strength. Not only has it opened 15 franchised locations across the north west in the last few years but it has made some serious inroads down south, opening locations in Bath and Gloucester. “Our target within the next three years is to be approaching 50 sites across the UK,” says Pearson. And, in addition to the introduction of commercial wing catering to everything from corner shops to industrial parks, Pearson Ferrier is also in the process of introducing a property maintenance arm. “That will enable us to offer a much better service to our landlords and indeed the general public,” he says.”
