Holiday Light Hanging Approaches

By Matt Doyle

Mitch Hendricks of Village Lighting Company recommends contractors focus on learning the business the first year to prevent overextending themselves, a common mistake. In the following two or three years, he then advises focusing on marketing and growing the business. Source: Village Lighting Company

Holiday lighting installation is a relatively new landscape contractor service worth investigating. Benefits include the retention of valued labor through the off-season, year-round income, and increased profits. However, a major decision is whether to adopt an independent or franchise approach, so LCN has compared the two options.

Marketing

When going the franchise route, one of the things you?EUR??,,????'???re paying for is the right to use the company?EUR??,,????'???s name and advertising. You also get the reputation associated with the franchise firm, for better or worse.

In an independent approach, you?EUR??,,????'???ll need to run your own ad campaign. A benefit is that you?EUR??,,????'???re building your own name rather than another?EUR??,,????'???s. However, you also may seem like an unknown competing against those with established reputations.

Training

Training is particularly important in the case of holiday light hanging, because the season runs from the end of October through the second week of December. This short time period creates a very steep learning curve, and franchises used to be the only ones to offer training. However, since then, some manufacturers and distributors have partnered to begin offering this service.

Product Selection

In the case of franchises, product selection is limited by what the franchiser will let you sell. This means that if your franchise fails to carry the hot lighting item for the season, you could be left in the cold. Some franchisers allow their franchisees to choose from a list of approved vendors. With D????(C)cor Lighting Group, a major franchise, the list runs about 10 to 12 manufacturers long. One advantage of a franchisers product supply can be consistency, thanks to exclusive manufacturer relationships that allow them to specify quality product for franchisees.

The independent approach usually allows for a more varied product selection. While product consistency can suffer with distributors, some manufacturers, including Village Lighting Company, will do custom orders if distributor selection is inadequate.

?EUR??,,????'??The season runs from the end of October through the second week of December. This short time period creates a very steep learning curve?EUR??,,????'?? photos: Village Lighting Company

Cost vs. Profit

The majority of franchises require an initial franchise and territory followed by periodic marketing and royalty fees. Some also charge a renewal fee with the expiration of a contract. In the case of The D????(C)cor Group, their contracts last five years and although the renewal fee is calculated on an individual basis, $2,000 is a ballpark figure. Total start up costs associated with this company are $20,000-$25,000. The company claims a franchisee average net profit of 23-25 percent, or $15,000 out of $60,000 in sales, not an unattainable number in the first year.

Both the independent and franchising approaches have their advantages and disadvantages. If a contractor is only interested in making some additional money over the off-season, the convenience and ease of start up associated with a franchise approach might be advisable. However, if a contractor is looking to grow their holiday light hanging service into a major, long term component of their business, the extra work associated with the independent approach might be worth it. One key to remember in making the decision is that franchises are legally obligated to allow prospective franchisees to speak with current franchisees. Asking about management styles, operating procedures, costs and simply what it?EUR??,,????'???s like to be a in a franchise allows for a more informed decision.

Illuminating Info

1882: Year the first electric holiday lighting was switched on, in mid-town Manhattan.

7: Watts. Large, traditional holiday lighting bulbs (typically labeled C-7 or C-9) use about seven watts per bulb. Mini-lights use about four tenths of a watt (0.4 Watt) per bulb, and LED lights use only four one-hundredths of a watt (0.04 Watt).

Source: Edison Electric Institute