You became an entrepreneur after leaving corporate. What ventures did you try?
Bergen’s Appliance Repairs & Spares was actually the ninth business I launched. Before that I ran concepts like biltong, sweets, nuts and a host of other things. When I was retrenched from corporate in 1995, I had to make a plan to earn money.
Launching these small businesses more or less at the same time gave me a chance to see which one would take. By the time 2002 rolled around I had spotted a gap in the market for appliance repairs and spares, even though I’d never fixed an appliance before in my life!
What important lessons have you learnt from being a franchisor?
A big lesson was realising investor buyers weren’t going to work. I had to salvage a couple of branches and now only consider owner-operators franchisees. The other major lesson was projecting value in the franchise price.
When I initially launched the franchise, branches could be bought for R95 000 but I got absolutely no interest from the market. This baffled me, but a businessman friend explained the low price didn’t correlate the value of the concept so why would people buy?
I pushed up the price to R150 000 and suddenly people started showing interest. Since then the price has increased with inflation and business complexity.
Why did you decide to franchise the concept?
It was my intention from the outset to franchise, but because there was no model to work from in South Africa I had to make sure everything was 100% right before franchising. Setting up multiple stores essentially allowed me to panel beat the model so it was replicable and effective.
Why did you develop Bergen’s Appliance Repairs & Spares?
I knew an opportunity when I saw one. I had the right technical know-how to conceive how the business would work and the need for a professional and good quality repair service for branded out-of-warranty home appliances was too good to pass up as no one was doing it.
That I was able to open my second store just ten months after launching the first one only proved there was a need and a market. By 2004 I was running five branches.
How important is it to keep innovating if a concept works?
It’s very important. The initial model centred on repairs and spares, and while I could’ve stayed with that, it would give competitors ample opportunity to match and exceed my offering.
So since 2012 I’ve added Bergen’s Solar, Bergen’s Appliance Maintenance – which is non-franchised insurance for home appliances – and our future growth lies in home plumbing, electrical and home automation. These add-ons are designed to turn the Bergen’s brand into a homeowner’s go-to brand for all their maintenance issues.