To help give you an insider’s look on what it takes launch and operate a Homeowner Referral Network (HRN), I’ve interviewed my colleague (and friend), Debbie Farson. Debbie is a mother of 3 and left her career as an attorney to launch her HRN business. Next fall marks the beginning of Debbie’s 10th year in business–a tremendous milestone for any business owner!
1. What did you do before you launched your HRN?
I had practiced law for several years before having my first child. Then I was home full time with my children and launched my HRN a month after having my third child.
2. Why did you want to launch a business from home?
I wanted to stop pinching pennies so tightly but going back to practicing law was not a good option…a home business meant I could make my own schedule and fit it around my family’s needs.
3. What was the launch date for your HRN?
Incorporated in October 2001 but really began doing business in April 2002.
4. (If you don’t mind) how old are you?
Now: 46. When I started my business: 37.
5. What attracted you about the HRN business?
I love any kind of before/after transformation (homes, people, you name it) and have been interested in building, construction and remodeling for as long as I can remember, yet I had no training or experience in that area.
By the time I started this business, we’d owned three homes and had our share of frustrations with home improvement projects.
I figured there had to be a better way to locate and check out contractors to avoid the common problems. The HRN business gave me the chance to work with a subject matter I love (home improvements) and solve problems for others (no more bad contractors!) without having to know the ins and outs of building and construction. Most importantly, it fits in with my family as it allows me to set my own schedule.
6. How did you know that an HRN would work in your area?
Statistics on remodeling projects, how many and what cost, are easily obtainable for most areas through the library or online. There are several mid- to high-wealth communities in and around the metropolitan area where I operate.
We also have people moving in and out of this area frequently due to changes in government administrations, military facilities nearby and large businesses located here. Yet, many of the higher-income people are living in older (30 – 70 year old) homes that need remodeling.
As a result of all these factors, people with the desire to improve their homes, and the money to do it, come to this area on a constant basis yet, because it is a somewhat transient area, they don’t always know people they can ask about whom they should hire.
What better environment could there be for an HRN?
7. How did you know that an HRN would be right for you personally? (Did you have an “AHA!” moment?)
Can’t say that I did. Just made sense to me from the beginning.
8. What types of services do you refer through your network?
Any and all home improvement services, from the smallest repair to the largest remodel – – even custom home builds!
9. What is the biggest job you’ve referred?
$325,000 custom home build (sounds like small amount for custom home, but homeowners will tear down existing house they own so there is no land price included in that.)
Have had many $100,000 – $200,000 remodels over the years as well.
10. What is the strangest referral request you’ve had?
A man once contacted me for help repairing a sagging floor in his kitchen. The unusual part was that the contractor had to turn around and leave before getting to the front door – – the smell of cats was overwhelming. He did stay long enough to see stacks of newspapers in the home, with a small trail through the stacks leading from the front door to the back of the house. This was a lesson for me in learning where best to put out the word about my business – – target the neighborhoods and types of homeowners you want rather then doing scattershot mailings or ads.
11. When did your business break even? Turn a profit?
I broke even within 6 months and turned a profit the first year. I think it would have been faster had I hit the ground running, but I started slowly as I had a newborn in the house.
12. What has been the most difficult task involved in operating your HRN?
Understanding what I don’t know and when to ask for help or seek an “accountability partner”.
Sometimes, indecision or lack of information will cause you to procrastinate, especially when you are really operating the business by yourself. I’m so grateful for my mentors (those who know this business better than I) and experts in areas like computers and websites who advise me and, when I need it, keep me from putting off important things.
13. What has been the most enjoyable aspect of the business?
Never having to clear time off with anyone else and being able to operate my business from anywhere – – which I have done (the ski slopes, a cruise ship in Hawaii, the beach, my local coffee shop, a family member’s hospital room, etc.)
14. What type of response have you received from homeowners about your services?
“The company you recommended was superb. Thanks so much for recommending them, and I look forward to working with you again in the future!! You made a project that I have been putting off for a long time very easy. “
“Thanks again for this invaluable service. It is so nice to be able to get things repaired and not have to worry about it not being done correctly or the mess that you have to clean up afterward.”
“I owe you big time! Your services greatly saved me time and resulted in more than I could have asked for.”
“Great work as always. The pre-job tracking and post job follow-ups are also great. Communication is usually the problem dealing with homeowners and contractors, and Home Solutions goes out of its way to be sure there aren’t any problems and that everyone is in touch and up to date.”
15. And what has the response been from contractors?
They love the win-win-win aspect of the business. If I get them a job, they pay me. If I don’t, they don’t. Truly, it’s so simple and, if they’re in my network, they see the benefits so clearly, that I can’t remember any contractor every having a negative reaction once they begin working with us.
They also appreciate the “third party sounding board” we provide for the homeowner as it has more than once resulted in the closing of a job that might not have closed otherwise (because the homeowner could ask us questions they might not have broached with the contractor.)
16. How has your business changed since you first started until now?
It’s bigger and more efficient. I am paperless now and almost completely mobile whereas, when I started, my records were all on paper and I was tied to my home office.
17. How has the economy affected your business?
I saw a downturn in business about 1 year before anyone else felt it. The silver lining in that was that it gave me time to breathe and focus on some infrastructure and marketing issues I’d not had time for before. I believe I’m also seeing recovery sooner and, now, I’m prepared for the large volume of business because of the time I was able to spend on organizational issues during the slower time.
18. What goals do you have for your business in the future?
I need to hire help! This is what will take my business to the next level. Now, if I could just get over that “control freak” thing . . .