One of the nation’s largest pool builders is expanding into a new business model.
Premier Pools has taken its first step toward going national by signing on a licensee in the Houston market.
“We think this has an opportunity to grow quickly because the industry’s going through a complete metamorphosis right now,” said Paul Porter, president of the firm, a Pool & Spa News Top Builder based in Rancho Cordova, Calif.
“We’re trying to take advantage of certain intellectual properties and economies of scale that we have.”
The Houston store is the beginning of a new business model for Porter. He and his business partner, Keith Harbeck, are looking to align with pool professionals to begin licensing branches around the country. These can be start-ups or existing firms that would take on the Premier brand.
Licensees will pay a percentage of their earnings to use the Premier brand while also taking advantage of the firm’s economies of scale and buying power, cooperative advertising, centralized human resources, legal and accounting services, and sales training.
Porter and Harbeck chose licensing agreements rather than franchises to allow more flexibility. Franchisees must adhere to strict requirements, which often dictate branding, product offerings, specific processes and, in some cases, even hiring requirements.
“That’s not logical in our industry because we’re dealing with different geographical areas, weather patterns and environments,” Porter said.
So far, the company has interviewed five potential licensees and found a good fit with Bill Unger. The 35-year industry veteran served as general manager of Blue Haven Pools’ Houston office for 18 years. Before that, he worked for a pool firm founded by his father.
“Premier is a great company,” Unger said. “While other companies are downsizing, they’re growing. I think we’ll be able to take over this market.”
In addition to the Premier start-up in the Houston suburb of Pearland, Unger plans to eventually open a second Houston office and establish roots in Austin, San Antonio and the Dallas/Fort Worth Metroplex.
Currently, he operates out of his home, with office construction expected to be completed in June. Unger had sold four pools as of press time, with a goal of 40 for the year.
The pool industry has seen very few national, or even multistate, builders. Some say it can be challenging for a pool firm to extend its reach very far because of the need for individual offices to sufficiently fit the corporate model while also accommodating their unique markets.
That’s what Swan Pools has found in its 50 years of managing multiple offices throughout California. “Most of the ingredients for success in this industry are right there in the area, between the local management and the local subcontractors,” said Cecil Fraser, owner of the Lake Forest, Calif.-based firm.
But for his part, Porter believes the licensing arrangement will enable his company to find fertile ground, enjoying the advantages of a large firm and the flexibility to serve regional markets. “We’re looking for people who have kind of a collaborative way of thinking, who don’t need all the answers and have an entrepreneurial spirit,” he said.
Licensees will have to meet certain performance criteria. Premier maintains the right to withdraw its licensing for companies that it believes are hurting the brand or no longer fit culturally.
Moreover, any existing businesses that become licensees will have to be reputable. “We’re not letting people walk away from existing customer bases because they’re in financial trouble,” Porter said. “We don’t want to be swept in with that, [where] they just changed their name to get out of payment to subcontractors or to get out of warranty work.”
In addition to Texas, Porter and Harbeck hope to open branches in Florida, the Carolinas, Louisiana and Colorado. However, any expansion will depend on finding the appropriate licensees, Porter said.
Overall, he is optimistic.
“Nobody in the market today has a vision of growth or sees this industry in anything but turmoil. I see that we have an opportunity to reinvent ourselves … and actually improve the industry.”
Porter believes that bringing companies together is a necessary step to help them achieve success in today’s market. “Going forward, you have to create strength, size and scalability. You have to share intellectual properties — all the things that will make you a bigger, better, stronger company,” he explained.
Premier currently has offices throughout California and Arizona. It also serves the Las Vegas market.