Renovation and home improvement will be stimulating the handyman and tradies sector over the next five years, which is good news for incoming franchisees who can take advantage of the upswing as we recover from the lockdowns.
According to analysis firm IBISWorld, capital expenditure on our homes is expected to rise at an annualised 3.5 per cent through to 2026.
Painting, fencing and general landscaping will be among the important services benefiting from the lift in spending predicted with a boost to household discretionary income and increasingly positive consumer sentiment.
Post-lockdowns, more households will be outsourcing maintenance to the professionals, IBISWorld suggests.
“Household projects requiring skilled inputs are likely to be left to tradesmen, whether franchised or independent,” Tradesman and Handyman Franchises in Australia report author Anthony Kelly wrote back in December 2020.
IBISWorld points to an increased appetite for basic renovation work as Aussies sell-up and move on.
“The solid growth in the number of households is also forecast to drive demand for new housing, along with renovation or refurbishment work on existing properties, boosting industry revenue,” Kelly wrote.
The realestate.com.au director of economic research Cameron Kusher noted just this week a record number of buyers in August were looking online for properties.
Australia’s closed borders have devastated immigration and put the brakes on population growth. With the closed borders expected to end in early 2022, things are set to change. Kelly predicts a rise in the number of households over the next five years with a projected industry revenue growth of 2.2 per cent, annualised, through to 2026 and a figure of $1.1 billion.
In addition to more business resulting from a growing population, a rise in housing transfers and improved consumer sentiment boosting the general renovations, maintenance such as site cleaning, gardening and minor repairs on smaller non-residential buildings, such as schools, can deliver opportunities for franchisees.
IBISWorld points out a contraction in employment of 0.5 per cent over the past five years, which is however, a slower fall than the drop in industry revenue (0.7 per cent). And that’s because of the “tendency for franchisees to retain full-time employment and ride out the recession”, Kelly said.
This story first appeared on our sister publication Inside Franchise Business