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This is Part 2 of a 3-part series on new business models, and whether and how entrepreneurs building in AEC (and for today, also manufacturing) tech can also adopt them.
In case you missed it, I covered vertical AI roll-ups in Part 1 here.
In today's piece, I want to talk about another interesting (and relatively novel in Startupland) business model: franchising. I'll also briefly touch on business-in-a-box, as it is closely related.
Let's dive in!
What is franchising?
I'm pretty sure that, in most people's minds, the term "franchise" is very closely associated with fast food brands such as McDonald's, Burger King, KFC, and a dozen other quick-service restaurant chains. And for good reasons: those are the largest franchises globally!
The term "franchising" finds its roots in the French verb "franchir", meaning "to make free," historically referring to liberation from restrictions. In the modern business context, it has evolved into a contractual relationship where an established entity, the franchisor, grants a license to another party, the franchisee. This license permits the franchisee to operate a business under the franchisor's established brand name and according to its prescribed business system. There are two types of franchising: product (or trade name) franchising and business format franchising. The context for this article is the latter, which, without getting into too much detail, involves the franchisor providing a comprehensive blueprint for the entire business operation, and the franchisee essentially replicating the franchisor's proven concept, from processes and service delivery to branding and customer experience.
The relationship between franchisor and franchisee is symbiotic. The franchisor contributes its established brand recognition, a tested and refined business system, comprehensive initial and ongoing training, and continuous support in areas like marketing, technology, and operational best practices. In return, the franchisee provides the capital investment required to establish and operate the local unit, manages the day-to-day operations in strict adherence to the franchisor's standards, and compensates the franchisor through an initial franchise fee and recurring royalty payments, typically calculated as a percentage of revenue. This structure offers distinct advantages to both parties: for the franchisor, it facilitates rapid expansion with significantly less capital outlay compared to building company-owned outlets, leveraging the franchisee's investment; for the franchisee, it offers a potentially lower-risk pathway into business ownership, benefiting from immediate brand recognition, a proven operational playbook, and dedicated support systems, which can significantly reduce the failure rates associated with independent startups.
Franchising is increasingly recognized across both Europe and the United States as an attractive alternative for individuals seeking an entrepreneurial career but who may lack the resources, experience, or risk appetite to build a business from the ground up. In Europe, the franchise sector has seen remarkable growth in recent years, with countries like France experiencing a surge in franchise ownership, from 58k franchisees in 2010 to over 78k by 2020, collectively employing nearly 670k people. In the United States, franchising now contributes over 3% to GDP, with more than 20k new franchise units expected to open in 2025 and franchise employment projected to surpass 9 million jobs.
While sectors like quick-service restaurants and retail have long dominated the franchising landscape, I think that the model's principles hold significant (and perhaps untapped) potential within specific segments of both AEC (and some of its adjacencies) and manufacturing. The argument here is that the inherent characteristics of certain verticals within these sectors can create a fertile ground for franchise expansion.
Let's discuss if and how franchising can work in AEC (and manufacturing).
Systematize, standardize, scale: the opportunity in home services
Within the broader AEC sector, I believe that home services stand out as a particularly fertile ground for franchise development, for a few reasons. First, execution is inherently local, requiring a distributed network of providers. Second, strong branding and marketing can build trust (based on track record) and differentiate service providers in a crowded field, a key benefit franchisors provide. Third, franchisees can benefit from the collective purchasing power and economies of scale negotiated by the franchisor.
Now, there's one thing to keep in mind: the foundamental prerequisite for a franchise model to work is that the business model is systematizable and standardizable. Ultimately, the underlying engine of scalability and consistent performance is the franchisor's ability to develop, implement, and continuously refine a replicable system.
That's why I think that a specific subset of the home service industry is particularly conducive for a franchisee model: "unprotected trades", meaning trades that require no formal state-level certification or licensing compared to highly regulated professions like electricians, plumbers, or HVAC technicians. Think residential painting, insulation installation, fencing, etc. You can standardize way beyond "processes", extending standardization to the actual execution of work, because in these unprotected trades, the work performed is remarkably consistent from one customer to the next. Unlike plumbing or electrical work (where each job might present unique challenges/variability), services like painting or insulation installation follow predictable workflows/patterns with reduced/minimal variability across jobs. This means that a franchisor can create comprehensive, proprietary training programs and curricula that can easily upskill inexperienced workers in weeks (or a few months max). This labor advantage is substantial, as finding workers/future franchisees becomes significantly easier when you're not limited to hiring from a small pool of hard-to-come-by, licensed professionals. Instead, you can recruit from a broader workforce, upskill them through your standardized training system, and maintain quality through consistent processes (and later, spin them off; more of this below).
That's not to say franchising is not feasible in highly skilled trades. It is, I just believe it's more challenging.
As mentioned, the core challenge in skilled trades is the inherent variability of each job. For example, no two plumbing leaks or electrical faults are identical, making rigid, task-by-task standardization nearly impossible. However, if you can't make every technical action identical, you can still standardize the processes, customer experience, and quality benchmarks that surround the variable technical work. Standardized operating procedures (SOPs) form the bedrock of this approach. While the specific job might differ, as a franchisor, you can develop comprehensive SOPs for common service categories, customer interaction protocols, diagnostic approaches, quoting methods, quality assurance checks, etc. Standardizing the customer experience is crucial, e.g. the way a customer is treated, from the initial call to the appearance and professionalism of the technician, the clarity of the explanation of work, and the follow-up. Hence, it follows that training is another key element to nail. Technicians should be extensively trained not only in technical skills but also in these standardized systems and preferred approaches to common problems. This will ensure a baseline consistency in how issues are diagnosed, solutions are proposed, and work is executed. Quality control checklists and audits complement this and help maintain high standards: by using detailed checklists for common job types (like those used in home inspections or outlined in plumbing quality control templates), the franchisor can ensure adherence to prescribed quality and operational benchmarks. Sitting on top, tech/software plays a crucial role in embedding these standardized processes into daily workflows, e.g. through quoting software with pre-set parameters, integrated job management, accounting, etc. (mind you: all this is valid and necessary for "unprotected trades", too).
Ultimately, whether operating in unprotected trades with highly standardizable work or in regulated skilled trades requiring adaptable frameworks, successful franchise models in home services depend on creating systems that deliver consistent quality and customer experiences. This approach involves breaking down your services into distinct components that can be systematically delivered, priced consistently, and easily taught to others, creating a system that can be executed reliably regardless of location or personnel.
At this point, the key question becomes: how do you develop and launch this franchise system?
The "franchise development blueprint" in home services (in short)
Launching a franchise is a classic "chicken-and-egg" problem. Before you can convince others to expand via your franchise, you must first demonstrate that your model works reliably and profitably.
This means you must initially operate some locations yourself, refine your processes, and prove your ability to consistently drive customer acquisition and deliver quality service at scale. You have to have people on your payroll, so you either hire them (e.g. for highly skilled trades) or you can upskill them (for the above-mentioned "unprotected trades"). Let's talk about the latter.
As previously mentioned, the benefit of unprotected trades is that you can upskill an unskilled workforce way more easily. To do that, you need to develop a structured in-house training academy/curriculum based on extensive hands-on practice. During this training period, these individuals are on your payroll despite not being fully productive, making thorough pre-hiring assessments of both aptitude and motivation essential to avoid investing in candidates who may ultimately leave before providing a return. Later, as these people move to become effective employees, you can identify which team members demonstrate not just technical proficiency but also leadership potential, for example, by consistently exceeding expectations and by showing aptitude for customer service and team management. These people could then be "spun off" into your first franchisees, thereby getting off your payroll but working exclusively under your own brand - you can lock them in contractually for 5-10 years, after which they are free to go independent (but should theoreticall stay due to the advantages you are providing). For such team members, becoming a franchisee represents both a career advancement opportunity and a path to business ownership that might otherwise be inaccessible. To facilitate this transition, as a franchisor, you might offer specific financial arrangements and financing.
It's important to note that the training academy is foundamental regardless of whether you're building in "unprotected trades" or not. The difference between the two is that while in the former you will also create a curriculum to learn the actual skills relevant to the trade, in the case of the latter, the training will mostly be focused on detailed operational procedures, sales and customer service techniques, financial management principles, software proficiency, and company culture.
That said, branding and marketing represent critical other investment areas, as franchisees are essentially purchasing immediate access to an established reputation. Hence, you must develop a comprehensive marketing infrastructure that drives growth at both national and local levels. At the broader scale, as a franchisor, you'll typically handle building and maintaining brand reputation through national advertising campaigns and public relations efforts, often funded through franchisee contributions to a dedicated advertising fund. Equally important is equipping franchisees with effective local marketing tools that would otherwise be beyond the reach of independent operators, including customized websites, SEO/SEM guidance, professional marketing collateral, and digital campaign resources. You might also want to implement a centralized lead generation system that distributes qualified prospects to the appropriate territories, significantly reducing franchisees' customer acquisition burden during their critical startup phase and supporting sustained growth thereafter. This would also help justify higher take rates. In this regard, it's crucial that your central marketing function focuses on unlocking B2B distribution channels, establishing partnerships that can create consistent revenue streams across multiple franchise territories. For example, as you build more industry track record and your network expands in both scale and geographic density, you'll likely gain access to larger, more lucrative projects that typically remain out of reach for independent contractors but which, however, can be effectively serviced by strategically pooling multiple franchisees from the same region.
Last, beyond setting standard operating procedures, proprietary technology systems represent a crucial component of a franchise offering. Your technology stack should include specialized CRM, job scheduling, project tracking, procurement, quality control, and real-time performance analytics that streamlines operations. It's important that these tools are intuitive enough for franchisees with limited technical expertise while powerful enough to generate meaningful business insights, operational efficiency and standardization to drive profitability.
With your franchise infrastructure in place, the next challenge becomes: how do you scale from a few locations to a nationwide leader?
From foundation to network
With your operational model validated and your first franchisees successfully running their businesses, it's time to consider how to scale your network more broadly. After building on the foundation of your franchise system, there are several ways to network expansion.
The first growth vector, as previously discussed, involves "spinning off" your highest-performing employees into franchisees. These individuals have already demonstrated mastery of your systems and alignment with your values, significantly reducing implementation risk. You provide them comprehensive access to your proprietary technology stack, ongoing training programs, and marketing resources. Additionally, you help them recruit (and potentially upskill) their team.
The second is by attracting external talent, for example entrepreneurial skilled trade professionals with substantial hands-on experience who want to branch out on their own, but who lack the business acumen, marketing capabilities, or capital resources to launch independent operations. These candidates bring valuable technical expertise while benefiting immensely from your established systems, brand recognition, and operational support infrastructure. This audience might be relatively easy to identify and engage at franchising events or trade shows: they're already actively looking for proven business models with support systems, making them receptive to your franchise offering.
Last, the fragmented nature of the home services industry presents a significant opportunity for platform building through conversion franchising. Let me elaborate by examining two companies that used this model and became leaders in the home service franchise space: Neighborly® and Authority Brands.
Neighborly is a "family of home services companies," aspiring to be the primary source for trusted, local home services professionals. It claims the title of the "world's largest home services company," a status built over more than 40 years in the franchising industry. Its extensive network comprises over 19 distinct service-based franchise organizations, encompassing more than 5,500 franchise units across North America and Europe. Neighborly's substantial growth has been significantly fueled by a deliberate acquisition strategy, by integrating established brands into its family (e.g. Window Genie, Mosquito Joe, and more).
Similarly, Authority Brands operates as the parent company for a suite of leading home service franchisors, including prominent skilled trade names like Benjamin Franklin Plumbing, Mister Sparky Electric, and One Hour Heating and Air Conditioning. The company supports a vast network of over 1,000 franchise owners who operate across more than 2,700 territories in the U.S. and Canada, collectively generating revenue exceeding $1Bn annually.
Conversion franchising has emerged as a key strategy for both companies to rapidly expand their footprint in the skilled trades sector.
Conversion franchising is the process whereby an existing independent business transitions to become a franchise unit operating under a larger, more established brand. This transformation involves the independent business adopting the franchisor's established business model, brand identity, operational procedures, and support systems. The process typically includes signing a formal franchise agreement, paying requisite franchise fees (which are often discounted for businesses undergoing conversion ), participating in brand-specific training, and undertaking necessary rebranding or facility revamping to align with the franchise's standards.
This model is particularly effective in skilled trades where pre-existing technical expertise and community trust are valuable assets. Franchisors acknowledge the tangible assets that converting businesses bring to the network (an active revenue stream, an established local presence and market understanding, and an existing team of technicians) and that's why, generally, franchisors offer discounted franchise fees and modified fee structures for conversion franchisees.
At the same time, independent skilled trades business owners are aware of their own limitations in critical areas like advanced marketing and branding, training, technology adoption, and systemic operational efficiency, and see franchising as a viable route to modernization and enhanced competitiveness. The extensive nature of these support functions underscores a critical point: while brand recognition is often the initial draw for a prospective franchisee, it is the ongoing operational leverage derived from the franchisor's comprehensive systems and support infrastructure that constitutes the core long-term value proposition. Effective training builds necessary skills, appropriate technology drives operational efficiency, robust marketing programs generate new revenue streams, centralized procurement delivers cost advantages via economies of scale, and continuous operational guidance helps overcome obstacles and maintain quality.
It's a win-win for both.
Again, I want to highlight how these expansion strategies typically become viable only after achieving significant scale, brand recognition, and an established track record in the industry. Reaching this inflection point requires significant upfront investment, as you'll likely need to operate multiple company-owned locations through a non-scalable model before unlocking the true potential of franchising. However, once this initial phase is overcome, a powerful flywheel effect takes hold (or, potentially, can).
Franchising in (project-based) manufacturing
The fundamental principle underpinning successful franchising (the ability to systematize and standardize a business model) extends beyond home services into other sectors adjacent to AEC, such as project-based manufacturing like small batch precision manufacturing. Hence, I want to share some thoughts on this space, too (I had previously very briefly touched upon this opportunity with an India-specific outlook here).
Indeed, I think that, just as you can franchise home painting or insulation by standardizing the work execution, or franchise plumbing by standardizing processes and customer experience, project-based (precision) manufacturing offers fertile ground for franchising precisely because it inherently relies on repeatable processes, quality control, and operational efficiency that can be codified and scaled. Geographic proximity to clients (-> distributed network of providers) also makes it particularly fitting for franchise models.
In manufacturing, the system being franchised would revolve around the production process itself: the layout of the shop floor, the specific machinery used, the workflow automation, the supply chain logistics, and the quality assurance protocols. A franchisor in the manufacturing space again provides franchisees not just with a brand, but with a proven production playbook. This can include access to financing for specialized equipment, proprietary software for operations (like quoting, inventory management, production scheduling), established supply chains with negotiated rates (or even better: centralized procurement leveraging economies of scale), comprehensive training on equipment operation and production techniques, and lead generation (and ideally: access to larger contracts). Access to capital represents a particularly significant advantage in manufacturing franchising, as equipment investments typically require substantially larger upfront expenditures than service businesses. Franchisors can leverage established relationships with equipment manufacturers and financial institutions to secure preferential financing terms for franchisees, dramatically lowering the capital barrier to entry.
As with service franchising, I think that manufacturing franchise systems will require significant upfront investment to establish proof of concept through company-owned facilities. The franchisor must demonstrate that the standardized production model delivers consistent quality, operational efficiency, and profitable margins before attracting qualified franchisees. However, once this foundation is established, the scaling potential can be substantial, particularly as the collective purchasing power of the network creates increasingly favorable economics for raw materials and equipment.
There's also an interesting caveat to the model: unlike conventional franchising, where each location essentially replicates the same capabilities, precision manufacturing franchising can strategically distribute complementary production capabilities across a network of specialized shops. In fact, precision manufacturing often requires diverse, capital-intensive equipment that would be financially impractical and operationally inefficient for any single location to maintain. Instead, as a franchisor, you could strategically develop specialized "nodes" within your network, each focused on distinct but complementary manufacturing processes. For example, one franchise location might specialize in CNC milling for precision metal components, while another focuses on advanced composite fabrication, and so on. Each shop maintains expertise and equipment in its particular domain, operating as part of an integrated production ecosystem. Your franchisor's proprietary technology platform sits on top and enables seamless coordination of multi-stage manufacturing projects across these specialized facilities. Centralized quality control protocols maintain consistency across the distributed production process, while a unified customer interface presents clients with a single point of contact despite the multi-location fabrication approach. As you understand, this approach offers significant advantages over both standalone shops and traditional franchise models. A key one is access to demand (generated by the franchisor): small independent shops typically face limitations in the scope of projects they can accept due to capability constraints, as they must either decline work requiring processes beyond their equipment suite or subcontract those portions at reduced margins to competitors. By contrast, the franchisor can bid on behalf of its network franchise members, knowing it has guaranteed access to complementary capabilities within its trusted network. Franchisees get stable demand and high utilization (which is ultimately the biggest challenge for small shop owners).
As for service franchising, manufacturing franchising can expand through "greenfield entrepreneurial franchises" (franchisor provides tech, pre-engineered factory layouts and turnkey financing to entrepreneurial talent opening new location), or through conversion franchising (existing shops become production franchisees).
Arlight, enough with the "theory"! Let me share two examples of startups exploring franchising in AEC and manufacturing.
"Cloud installers" and mobile-micro-factories
As a first example, allow me to be biased and choose a portfolio company: VARM.
VARM provides retrofit insulation solutions for buildings and homes, addressing the significant fragmentation of a sector dominated by small (mostly four-person mom-and-pop) shops, and helping building owners reduce heating costs and carbon emissions by up to 50%. Their ambition? Insulating 1m homes across Europe in the next 10 years.
To do so, they are building the industry standard for insulation through a highly systematized approach that can be rapidly scaled and that ensures consistent quality and efficiency across projects. On top of standardization and systematization, their approach centers on building a "cloud infrastructure" for insulation, with the core of their model being a network of independent VARM "cloud installers" (akin to franchisees), who operate off-payroll but are managed through VARM's comprehensive software stack and dedicate their capacity to the company.
Unlike other construction trades with formal apprenticeship programs, insulation has remained largely unregulated, offering a unique opportunity that VARM smartly capitalizes on by creating its own curriculum. Indeed, VARM recruits both skilled and unskilled workers, sending them through VARM's own academy to learn insulation techniques, company culture, quality standards, and software usage. After working on payroll for VARM, the best performers are offered the opportunity to become "cloud installers" (independent business owners who guarantee VARM 100% of their capacity, while gaining financial upside). These cloud installers are charged similarly to franchisees, ultimately allowing VARM to operate as a lean tech platform handling all non-value-adding aspects of the insulation business (on which small insulation shops generally spend more than half their time!). Their proprietary software platform serves as the technological backbone of this operation, streamlining everything from customer acquisition to project management and dispatching, while generating valuable data insights that continuously improve their standardized processes.
The result? An average of 5 stars from 183 Google reviews, and software-like margins.
A compelling example of "franchising systematization" applied to (AEC-related) manufacturing is Cuby.
While not a traditional franchise in the typical sense, Cuby embodies the core principle of franchising a system (in their case, the factory itself). Cuby develops and deploys mobile micro-factories near large construction sites. Their core product isn't the end building, but rather the factory: a turnkey, transportable system designed to produce building components locally using standardized processes, robotics, proprietary software, and often unskilled labor trained on their specific system. Cuby essentially offers its partners (builders, developers, contractors) a factory-in-a-box: it provides the hardware, software, and lean manufacturing processes needed to produce high-quality building components efficiently and cost-effectively, close to the point of use. This model (franchise-driven or a licensing arrangement), allows partners to leverage Cuby's sophisticated, standardized manufacturing system without needing to develop it themselves. Cuby focuses on standardizing the how (the manufacturing process) to deliver consistent results, even if the final houses cater to different designs. They tackle the labor shortage by designing systems usable by locally sourced, quickly trained, unskilled workers, mirroring the advantage seen in unprotected home service trades.
Cuby's monetization approach shares key elements with traditional franchising while introducing innovations necessitated by the capital-intensive nature of manufacturing. For example, Cuby employs SPVs (financed by developers and home builders) to finance each micro-factory (rather than the traditional starting franchise fee), and demands anything between 10% and 20% of the offtake price of each home produced (similar to the royalty fee). This allows Cuby to scale asset-light and focus investment on continuous technological improvement, rather than production infrastructure.
Where traditional franchising is often location-based with protected territories, Cuby's model is production capacity-based, with each factory designed to serve multiple construction sites within its 150-mile radius. This creates a distributed manufacturing network that combines the quality control advantages of centralized production with the logistics efficiencies of local delivery, effectively solving the transportation challenges that have plagued previous prefabricated housing attempts.
A point on franchising for white collar professions
While I've extensively covered the franchising potential in trade services and manufacturing, I thought I'd spend a couple of words on franchising in white-collar AEC professions (architecture, structural engineering, etc). The summary: I struggle to see it working, since the fundamental premise underpinning successful franchising (systematic standardization of and replicability of processes and/or tasks) breaks down here.
Think about it: at its core, high-value white-collar work in architecture and engineering derives its worth precisely from what makes it difficult to franchise: customization and client-specific requirements, deep expertise, professional judgment, and client-specific solutions. There's a high degree of creative problem-solving and intellectual labor that resists rigid systematization. You might wonder: isn't this customization and customer-level specificity similar to what we have in some blue-collar professions, e.g. plumbing? I argue it isn't.
Let's take the plumbing example. First, while (home service) plumbing jobs do vary, they typically involve a finite set of common problems with established diagnostic approaches and solutions. A leaking pipe, clogged drain, or faulty water heater may present differently in each home, but the underlying technical solutions draw from a relatively standardizable knowledge base. In contrast, architectural or engineering projects involve exponentially more variables and require solutions that are not merely variations on standard approaches but often fundamentally unique creations. The scale of professional judgment also differs dramatically. A plumber might need to make dozens of tactical decisions during a repair, but these typically occur within well-understood parameters and established best practices. An architect or engineer might make hundreds or thousands of interconnected decisions on a single project, many involving creative judgment, aesthetic considerations, or complex technical trade-offs that resist standardization. This "depth" of professional judgment required creates a meaningful barrier.
I also think that the project "frequency" and duration have a meaningful impact on the value of a franchise approach. A plumbing franchise might complete several jobs daily, creating numerous opportunities to refine processes and amortize franchise costs across many revenue events due to increased operational efficiency. Architectural firms might work on fewer, longer-duration projects, meaning each engagement carries more significant financial weight and less opportunity to leverage the repetition-based advantages of a franchise system. This lower frequency of client interactions (coupled with a high degree of customization) makes the standardization of client acquisition and relationship management less valuable compared to trades that serve many customers.
Most importantly, the value proposition to clients differs fundamentally. Homeowners hiring plumbers primarily seek functional outcomes (fixing what's broken or installing what's needed with reliability and fair pricing). In contrast, clients engaging architects or engineers are often investing in creative vision, innovative approaches, and distinctive expertise tailored to their specific project needs. The very standardization that makes franchising powerful in service trades can undermine the perceived value of professional services where originality and custom solutions command premium fees.
This doesn't mean franchising is entirely impossible in white-collar AEC professions. There are some examples of companies doing that (but I have no visibility into the extent of their success). One such company is HVJ Associates® , an engineering service firm from Texas. Interestingly, they franchise through what they refer to as "Branchising". From their website:
To reduce the capital needed to start a franchise, and to implement and embody our culture and systems, we start each location as a branch office. The branch manager is the future franchisee and goes through training during this period. Once the branch reaches a sufficient revenue threshold, we create the franchise through a combined asset purchase agreement of the branch assets and a franchise agreement. Executing these agreements converts the HVJ owned branch to an independently owned and operated franchise with existing staff, equipment, clients, and projects intact.
That said, any example remains the exception rather than the rule.
Alright. We've so far thoroughly discussed the franchise model. But before concluding this article on franchising, I'd like to explore a "lighter-weight" variation of the franchise concept that might appeal to independent tradespeople/solopreneurs.
"Business-in-a-box": back-of-house support, front-of-house freedom
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As anticipated, there's another variation of the franchise model worth spending a couple of words on: business-in-a-box.
At its core, the business-in-a-box concept empowers (prospective entrepreneurial) skilled tradespeople to "be their own boss", by providing access to comprehensive behind-the-scenes operational frameworks and tools (e.g., software that for example automates everything except their core technical work; access to equipment), therefore eliminating many business startup obstacles, while simultaneously allowing the individual to maintain complete autonomy over their customer-facing identity, service approach, and brand presentation. Hence: this model delivers many franchise-like operational benefits to solopreneurs without requiring them to operate under a unified brand.
The primary distinction between business-in-a-box and franchising is therefore clear, and lies in brand ownership and operational control. In this model, contractors retain their individual brand identity rather than adopting a national brand. There are no territory restrictions or protected service areas. Royalty payments are replaced with SaaS subscription fees. Quality control is managed by the entrepreneur, not a central organization. The technology provider has no direct responsibility for service delivery. Therefore, this approach particularly appeals to skilled tradespeople who seek independence.
The foundation of this approach is vertical SaaS that handles non-core activities: customer acquisition, appointment scheduling, payment processing, follow-up communications, inventory management, etc. This automation frees skilled professionals to focus exclusively on their craft (plumbing, electrical work, or any other specialized service) without being bogged down by administrative tasks (that typically consume 30-50% of their working hours). Plug in AI (which should extend capabilities/extent of automation) and you've got a fantastic offering.
That said, value extends beyond a mere software offering: you're not just building vSaaS. It's a far more comprehensive product, aiming to provide a nearly turnkey solution, especially for aspiring entrepreneurs and solopreneurs to launch their operations from scratch. While the industry-specific software remains a critical technological core, the "business-in-a-box" philosophy extends beyond that, by lowering the often-daunting barriers to business entry and the complexities of successfully running a business, effectively democratizing (I hate the term, but it's fitting) entrepreneurship. Imagine, for example, a skilled electrician wanting to start their own independent practice. A vertical SaaS solution might provide them with excellent software for scheduling jobs and invoicing. This is undoubtedly valuable. But a "business-in-a-box" designed for electricians would include this essential software and then layer on additional, crucial support structures, such as business setup assistance, licensing requirements, legal support (all for a fee). Furthermore, it would incorporate well-defined operational frameworks and best-practice playbooks: the entrepreneur could adopt these proven methods as is, customize them to their unique style, or use them as a learning resource.
The support would also extend to marketing and branding. For example, while the entrepreneur retains full ownership of their brand, the business-in-a-box might provide a customizable template website and pre-designed marketing material templates such as brochures or social media posts, helping them establish a professional presence and attract customers more effectively from day one.
Training would still be part of the offering, with modules addressing for example local marketing strategies tailored to their trade, techniques for delivering exceptional customer service that builds loyalty, fundamentals of financial management for small businesses, or strategies for effective lead generation and customer acquisition. Basically, filling the knowledge gaps that skilled tradespeople, often experts in their craft but not necessarily in commerce and business management, might possess.
Last, as the platform evolves, it may incorporate additional elements typically associated with franchising, such as group purchasing programs for materials and equipment or financial services. Long term, it might add a consumer-facing layer for lead generation.
For solopreneurs, the business-in-a-box approach offers compelling advantages: lower startup complexity, reduced administrative burden, access to sophisticated technology, and preservation of independence.
Conclusion
It's time to bring this article home!
The franchising model represents a significant untapped opportunity within specific segments of AEC and manufacturing, particularly where standardization can create genuine competitive advantages. That said, while opportunity is substantial, it requires entrepreneurs to invest deeply in systematization, training, and technology infrastructure before reaping the rewards of scalable, asset-light growth.
The home services sector is the most compelling immediate opportunity in my opinion, especially within "unprotected trades", where standardization extends beyond processes to actual work execution. In project-based manufacturing, the potential runs even deeper.
Ultimately, the critical inflection point for any aspiring franchisor remains the same: you must first prove the model works through company-owned operations before others will invest in replicating it. This requires significant upfront capital and patience, but once achieved, it potentially unlocks a high-growth, high-margin opportunity.
That's it for part two of the "New business models, and can they work for AEC-tech?" series. Stay tuned and subscribe to my newsletter so you don't miss the next (and last) one in the series!
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