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Chas Everitt: Berry Everitt

Berry Everitt, MD of the Chas Everitt International Property Group, grew up in real estate. With parents who talked property and business at the breakfast, lunch and dinner table, it’s no wonder that today he heads up one of the most well-known names in the property market, despite being a surfer at heart as a young man.

Nadine Todd

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Berry Everitt

Franchises don’t always begin as franchises. More often than not they start off as a single restaurant, fast-food store, retail shop or, in the case of Chas Everitt, a husband and wife team launching their own real estate agency.

Charles (Chas) Everitt and his wife Tilla started their real estate company in 1980. Mother and father ran the business together, and although their youngest son Berry had been exposed to property all his life as a result, he did not immediately think of joining his father in the family business once his stint in the army was over. Instead, he moved to Durban, the city where he had spent the majority of his childhood before his parents relocated to Johannesburg. Little did he know that not only would he be the Everitt who turned the family business into a franchise, but that he would do it through a unique franchising model as well.

“As a youngster, I wanted to surf and live by the sea,” he explains. “I wasn’t against the idea of working with my father, I just didn’t think about it.” Instead, taking a position as a trainee liquidator at Arthur Young Trust and Management and studying a CIS in Durban, he began to develop his skills in the financial and business arena. These selfsame skills serendipitously ended up taking him straight to his father’s door.

“By 1990 Chas Everitt had grown and was still growing under mom and dad’s guidance, but my parents needed someone to handle the financial side of the business,” says Berry. “Not only was this squarely in my area of expertise, but the financials of a business are not something you entrust to just anybody. Charles and Tilla wanted someone they could trust.”

By this time it was his wife to be, Tracey, who convinced him that it was time to move back to Joburg and join his father’s team. “The first thing I did was help my father computerise the business and develop systems and processes. My previous experience had exposed me to a myriad of business processes that did and did not work, and I used this knowledge to add value to the company.”

By 1996, Chas Everitt had seven successful agencies to its name, and father and son were considering their next move. The industry as a whole was moving towards a franchising model, and while Berry and Chas both agreed that this was the way forward, their opinions on how to get there, and what the model would look like, differed.

Choosing a Direction

“The business was doing well, but in order to grow further we needed to put a structure in place that could be disseminated across a number of businesses. The franchise model was the obvious way to do this, and to secure a national footprint, but I didn’t want to implement a traditional franchise model,” says Berry. “Because we were already an established business, we didn’t need head office owned stores to generate revenue for the franchise.” Berry believes that head office owned stores can create an ‘us and them’ mentality between the franchisor and franchisees. “No one store should hold more value or significance to the franchisor than another,” he explains. “We were in a position to just be a franchisor, and not also a store owner. This gave us a unique opportunity to create a family where all franchisees are equal, with absolutely no danger that other franchisees could assume that the needs and success of any stores are more important than their own.”

While Charles was not wholly convinced in the beginning, favouring a more  traditional franchising model,  Berry’s persistence and belief in his model won out, and Charles made the decision to sell the company to his son, handing over the reigns to the next generation. An undisclosed sum was agreed upon, and Berry would make the payments over four years, starting in 1997. Charles remains the chairman of Chas Everitt’s board, but Berry is the principal decision maker of the business’s day-to-day operations.

The Franchise Model

Berry’s plan had two phases. First, he wanted to restructure the existing seven agencies into individual business units. This would decentralise the real estate operations’ day-to-day

decision making and focus the core real estate revenues in the franchise operations, allowing for the individual strengths of each business leader to emerge. An agency that was doing very well could use its own profits to incentivise its staff, instead of those profits being used to support another, less successful agency within the group. “This was really step one towards franchising the business. Each agency takes control of its own success, and in so doing becomes more flexible as well. Customer-centric markets require agencies to be able to match their clientele’s specific needs — many markets need many different shoes to fit them. A franchisor offers a brand name, stability and strong, proven systems, but franchisee-owned agencies offer clients flexibility and tailored solutions. And of course, owning an agency and its profits is a great incentive to succeed.”

The first seven agencies were consolidated into five, and Berry offered the managers equity on an earn out basis. “When you find great people you need to keep them, and ownership is one way to do that. Those agencies became our first franchises. I am personally invested in them along with the managers who run them. Our franchising head office has no link to them other than the franchisor-franchisee relationship.”

Tested on the first five agencies, the model proved successful, and in 2003 Berry and his team started a national rollout. “Franchisor infrastructure control develops, implements and maintains systems, training and operations manuals,” he says. “We ensure each of our franchisees has the best business infrastructure possible, are kept up to date on the latest industry developments and changes, as well as sourcing, training and retaining great and well looked after agents.”

Even though it is a franchise with 108 franchisees, Chas Everitt began as a family business, and that ideology continues to permeate the way the group does business today. “Existing franchisees in an area are invited to meet a prospective franchisee before we sign any deals with them,” says Berry. “They have a veto right. If they don’t think the person suits our organisation, we won’t sign a deal with them.” According to Berry this has only happened once in the franchise’s history, but it does mean that new franchisees are immediately accepted and welcomed into the Chas Everitt community. “Our strength and power lies in our team of franchisees and agents around the country — we select them carefully and work hand in hand developing and innovating continuously.”

“One of our core focuses is on fostering our ‘family’,” Berry explains. “This means keeping communication channels open between head office and franchisees, agents and admin staff across the country, as well as being available as head office to clients who have questions and queries. If you complain at a franchise level you will deal directly with me, and we sell between 500 and 600 houses a month. Every client is important to the group as a whole.

“Barry Davies, the group’s franchising director, isn’t just head office’s contact with new and existing franchisees. He is available to agents who are having personal problems. He speaks to clients of franchisees and he is always, always available to a franchisee, as are the rest of the support team.”

Riding Out the Recession

Chas Everitt has emerged from the recession, where the industry as a whole dropped by 50%, with its franchisees largely intact, thanks to a focus on consolidation rather than trying to sell new franchises during a downturn.

“Our core focus was to keep our existing franchises open and help them weather the storm,” says Berry. “The last two years haven’t been easy. Our revenues dropped by 45% — but we managed to cut our costs by 55%.”

New technology, a renewed focus on operational efficiency and plain old innovation allowed the group to face the recession head-on and come out on top.

“One of our best moves was approaching FNB and helping them to develop their FNB Quick Sell product,” says Berry. “Today all the major banks have a similar product, but we piloted it.” The idea behind Quick Sell is simple: traditionally, banks put houses whose bonds cannot be furnished on auction. Typically they suffer a 50% loss in so doing.

The recession presented a unique problem, however. Loyal customers who had never defaulted on their loans suddenly could not pay their instalments. The banks did not want to penalise these customers, but they could not simply ignore the fact that bonds were not being paid either. Quick Sell offers a solution to both parties. The bank agrees to let the homeowner remain in the house until it is sold, which means the sell does not look like a forced sale, but a normal sale. The house is put on the market, and the real estate agent takes a very small commission. In exchange for cooperating, the bondholder gets a ‘forgiveness’ package from the bank.

“We sell for less, and everyone in the value chain accommodates the distressed customer, it also means that everyone wins in a bad situation,” says Berry. “It also opened a great new market for our agents. Yes, their commissions are much lower, but they prospered through the slump.” l

Buying the Business

Berry and Charles agreed on the terms under which Berry would buy Chas Everitt in 1997. At the time, market predications were soaring, with economists expecting interest rates to drop from 16% to 14%. Instead the unthinkable happened, and interest rates soared to 25% in the space of a few short months.

“It was probably the craziest time to try and buy a property business,” Berry recalls. “The decentralisation of agencies certainly helped, but on the whole it was a really tough time. I spent between 12 and 22 hours a day at work, and a lot of time praying and believing that we would make it through to the other side unscathed.”

At this point in his life and career, Berry was, in his own words, “a young bull, full of ideas and probably a fair share of arrogance.” He didn’t want to use Charles’s good reputation with the banks or his contacts. He wanted to raise the funds he needed to buy the business himself. And so he approached financiers as an unknown, which required him to put up much higher surety. “In hindsight, I made things much harder for myself than they needed to be,” says Berry. “I was putting unnecessary pressure on myself during a very difficult time. But it turned out to be  a phenomenal character building exercise to go through what I did restructuring Chas Everitt during such a massive downturn and coming out on the other side as one of the top five estate agents in South Africa.”

Nadine Todd is the Managing Editor of Entrepreneur Magazine, the How-To guide for growing businesses. Find her on Google+.

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Entrepreneur Profiles

Jason English On Growing Prommac’s Turnover Tenfold And Being Mindful Of The ‘Oros Effect’

Rapid growth and expansion can lead to a dilution of the foundational principles that defined your company in its early days. Jason English of Prommac discusses how you can retain your company’s culture and vision while growing quickly.

GG van Rooyen

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Vital stats

  • Player: Jason English
  • Position: CEO
  • Company: Prommac
  • Associations: Young President’s Organisation (YPO)
  • Turnover: R300 million (R1 billion as a group)
  • Visit: prommac.com
  • About: Prommac is a construction services business specialising in commissioning, plant maintenance, plant shutdowns and capital projects. Jason English purchased the majority of the company late in 2012, and currently acts as its CEO. Under his leadership, the company has grown from a small business to an international operation.

Since Jason English purchased Prommac in 2012, the company has experienced phenomenal growth. At the time he took over as owner and CEO, it was a small operation that boasted a turnover below R50 million.

Today, Prommac is part of a diversified group of companies under the CG Holdings umbrella and alone has grown it’s turnover nearly ten fold since Jason English took over. As a group, CG Holdings, of which Jason is a founder, is generating in excess of R1 billion. How has Prommac managed such phenomenal growth? According to Jason, it’s all about company culture… and about protecting your glass of Oros.

Jason English

Related: 5 Top Lessons From LAWTrust To Prepare For Super-Charged Growth

“As your business grows, it suffers from something that I call the Oros Effect. Think of your small start-up as an undiluted glass of Oros. When you’re leading a small company, it really is a product of you. You know everything about the business and you make every decision. The systems, the processes, the culture — these are all a product of your actions and beliefs. As you grow, though, things start to change. With every new person added to the mix, you dilute that glass of Oros.

“That’s not to say that your employees are doing anything wrong, or that they are actively trying to damage the business, but the culture — which was once so clear — becomes hazy. The company loses that singular vision. As the owner, you’re forced to share ‘your Oros’ with an increasing number of people, and by pouring more and more of it into other glasses, it loses the distinctive flavour it once had. By the time you’re at the head of a large international company, you can easily be left with a glass that contains more water than Oros.

“Protecting and nurturing a company’s culture isn’t easy, but it’s worth the effort. Prommac has enjoyed excellent growth, and I ascribe a lot of that success to our company culture. Whenever we’ve spent real time and money on replenishing the Oros, we’ve seen the benefits of it directly afterwards.

“There have been times when we have made the tough decision to slow growth and focus on getting the culture right. Growth is great, of course, but it’s hard to get the culture right when new people are joining the company all the time and you’re scaling aggressively. So, we’ve slowed down at times, but we’ve almost always seen immediate benefits in terms of growth afterwards. We focus heavily on training that deals with things like the systems, processes and culture of the company. We’ve also created a culture and environment that you won’t necessarily associate with engineering and heavy industries. In fact, it has more in common with a Silicon Valley company like Google than your traditional engineering firm.

“Acquisitions can be particularly tricky when it comes to culture and vision. As mentioned, CG Holdings has acquired several companies over the last few years, and when it comes to acquisition, managing the culture is far trickier than it is with normal hiring. When you hire a new employee, you can educate them in the ways and culture of the business. When you acquire an entire company, you import not only a large number of new people, but also an existing organisation with its own culture and vision. Because of this, we’ve created a centralised hub that manages all training and other company activities pertaining to culture. We don’t allow the various companies to do their own thing. That helps to manage the culture as the company grows and expands, since it ensures that everyone’s on the same page.

“Systems and processes need to make sense. One of the key reasons that drove us to create a central platform for training is the belief that systems and processes need to make sense to employees. Everyone should understand the benefits of using a system. If they don’t understand a system or process, they will revert to what they did in the past, especially when you’re talking about an acquired company. You should expect employees to make use of the proper systems and processes, but they need to be properly trained in them first. A lot of companies have great systems, but they aren’t very good at actually implementing them, and the primary reason for this is a lack of training.

“Operations — getting the work done — is seen as the priority, and training is only done if and when a bit of extra time is available. We fell into that trap a year ago. We had enjoyed a lot of growth and momentum, so we didn’t slow down. Eventually, we could see that this huge push, and the consequent lack of focus on the core values of the business, were affecting operations. So, we had to put the hammer down and refocus on systems, processes and culture. Today Prommac is back at the top of it’s game having been awarded the prestigious Service Provider of the year for 2017 by Sasol for both their Secunda and Sasolburg chemical complexes.

Related: Establishing The Wheels Of Change In Business

“If you want to know about the state of your company’s culture, go outside the business. We realised that we needed to ‘pour more Oros into the company’ by asking clients. We use customer surveys to track our own performance and to make sure that the company is in a healthy state. It’s a great way to monitor your organisation, and there are trigger questions that can be asked, which will give you immediate insight into the state of the culture.

prommac

“It’s important, of course, to ask your employees about the state of the business and its culture as well, but you should also ask your customers. Your clients will quickly pick up if something is wrong. The fact of the matter is, internal things like culture can have a dramatic effect on the level of service offered to customers. That’s why it’s so important to spend time on these internal things — they have a direct impact on every aspect of the business.

“Remember that clients understand the value of training. There is always a tension between training and operational requirements, but don’t assume that your clients will automatically be annoyed because you’re sending employees on training. Be open and honest, explain to a client that an employee who regularly services the company will be going on training. Ultimately, the client benefits if you spend time and money on an employee that they regularly deal with.

“For the most part, they will understand and respect your decision. At times, there will be push back, both from clients and from your own managers, but you need to be firm. In the long term, training is win-win for everyone involved. Also, you don’t want a client to become overly dependent on a single employee from your company. What if that employee quits? Training offers a good opportunity to swop out employees, and to ensure that you have a group of individuals who can be assigned to a specific client. We rotate our people to make sure that no single person becomes a knowledge expert on a client’s facility, so when we need to pull someone out of the system for training, it’s not the end of the world.

“Managers will often be your biggest challenge when it comes to training. Early on, we hired a lot of young people we could train from scratch. As we grew and needed more expertise, we started hiring senior employees with experience. When it came to things like systems, processes and culture, we actually had far more issues with some of the senior people.

“Someone with significant experience approaches things with preconceived notions and beliefs, so it can be more difficult to get buy-in from them. Don’t assume that training is only for entry-level employees. You need to focus on your senior people and make sure that they see the value of what you are doing. It doesn’t matter how much Oros you add to the mix if managers keep diluting it.”

Exponential growth

When Jason English purchased Prommac late in 2012, the company had a turnover of less than R50 million. This has grown nearly ten fold in just under five years. How? By focusing on people, culture and training.

key-insights-from-jason-english

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Who’s Leading Your Business Billy Selekane Asks – You Or The Monkey On Your Back?

You’re either a change-maker, or someone who is influenced by the shifting conditions around you. The truly successful know how to determine their own destinies. Here’s how they do it.

Nadine Todd

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billy-selekane

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  • Player: Billy Selekane
  • Company: Billy Selekane and Associates
  • About: Billy Selekane is an author, internationally acclaimed inspirational keynote speaker, and a personal, team and organisational effectiveness specialist.
  • Visit: billyselekanespeaks.com

We live in a world of disruption. We live in a world where Airbnb’s valuation is $31 billion, but the Hilton’s market cap is $30 billion. Airbnb doesn’t own one square kilometre, and yet they’re worth more than the world’s biggest hotel chains with enormous assets. We live in a world where things have been turned upside down.

In this brave new world, you can either thrive, or fight to survive. As a leader in your organisation, the choices you make, the mental mind-space you occupy and how you engage with those around you, will determine your personal success, as well as that of your entire organisation.

“The business of business is people. You can’t just pay lip service to the idea that they are your most important asset. You need to live it. Leaders must be intelligent and honest. You can’t just push people to meet the numbers,” says Billy Selekane, personal and business mastery expert and international speaker.

The problem is that great leaders need to first find balance within, before they can successfully lead their organisations.

“Things can no longer be done the same way,” says Billy. “Success today is defined by people who are driven, are inspired by their own lives and goals, and have the power and capability to inspire others.” But before you can achieve any of this, you need to rid yourself of the monkey on your back.

Related: Billy Selekane

The monkey on your back

“If I continue doing what I’m doing, and thinking what I’m thinking, I’ll continue to have what I have,” says Billy. “That’s the definition of insanity. Are you doing things by default or design?”

Billy’s analogy is a simple one. It’s something we can all relate to, and it’s the single biggest thing stopping us from clearing our minds, focusing on the positive and achieving success. He calls it the monkey on our backs.

“Every one of us is born with an invisible monkey on their shoulder,” says Billy. “Your monkey is always with you. Sometimes they’re the one speaking, and you need to be careful of that.” What you need to be even more aware of than your own monkey though, is everyone else’s monkeys.

“Every interaction we have is an opportunity for what I call a monkey download. You have an argument with your spouse before work, and you end up getting into your car with not only your monkey, but theirs as well. Your irritation level has doubled thanks to the extra monkey. Now you get irritated with a pointsman, another driver or a taxi on your way to work. You’ve just added three monkeys.

“By the time you walk into the office, you’re bringing an entire village of monkeys with you. They’re clamouring, clattering, arguing with each other, and the noise is deafening. Not only does everyone get out of your way, but you can’t hear yourself think. And the more your mood drops, the more monkeys you download from the people around you. This is not the path to focus, achieving your goals or being happy. It’s certainly not the path to great leadership.

“Great leaders know how to keep all those monkeys out. They know how to control their moods, and regulate their own positivity. They understand that they are the architects of their own success.”

Getting out of the monkey business

To be a great leader — and personally successful and happy — you need to start by getting out of your own way, and as Billy calls it, ‘getting out of the monkey business.’ You need to not only shake your own monkey, but everyone else’s as well.

According to Billy, there are four simple areas you can begin focusing on today that will help you become the person (and leader) you want to be.

First, honesty is the foundation of everything else you should be doing. “Be clear and straight. Speak to people simply and honestly, but with respect. Connect with them, not through the head, but with the heart. Don’t play tricks.”

Related: 5 Top Lessons From LAWTrust To Prepare For Super-Charged Growth

Next, be authentic. All great leaders are authentic, and recognised as such. Aligned with this is integrity. “This is sadly out of stock, not only in South Africa, but the world,” says Billy.

“There is nothing as disturbing as a leader without integrity, and on a personal level, you won’t achieve emotional stability if you aren’t a person of integrity.”

Finally, you need to embrace love. “Wish your employees well. Wish your family, friends and connections well. When we are given love, and trusted to perform, we take that and pay it forward. In the case of business, this means your employees are giving the same love to customers, but if everyone showed a little more love, the world would be a better place. When people feel cared for, they show up with their hearts and wallets, and they pay it forward.

“Great leaders understand this. They don’t only focus on making themselves better, but adding to everyone around them. Remember this: In every business, there are no bad employees, just bad leaders. Employees are a reflection of that.”

If you want to build a better future, business or life, you need to start with yourself.


Do this

Stop letting negative thoughts and minor irritations derail you. You are the master of your moods and thoughts, so take personal responsibility for them.

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Shark Tank Funded Start-up Native Decor’s Founder on Investment, Mentorship And Dreaming Big

Vusani Ravele secured offers from every single Shark in the first episode of Shark Tank South Africa, eventually settling on an offer from Gil Oved from The Creative Counsel. Entrepreneur asked to him how this investment has changed his business.

GG van Rooyen

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Vital stats

  • Player: Vusani Ravele
  • Company: Native Decor
  • Established: February 2016
  • Visit: nativedecor.co.za
  • About: Native Decor creates visually pleasing products from sustainable timber. The company’s designs are innovative and functional, with its creations mostly inspired by South African cultures, landscapes and wildlife.

It all started with a cordless drill. In February 2015, Vusani Ravele received a drill from his girlfriend as a Valentine’s Day gift. He immediately became obsessed.

“I couldn’t stop drilling holes in things,” Vusani laughs. “I just loved working with my hands.”

Unlike most people, who lose interest in a Valentine’s Day gift by the first day of March, Vusani’s passion for his cordless drill didn’t dissipate. Instead, it had reignited a spark. Thanks to that cordless drill, he rediscovered a love for design he’d first felt in high school. And one year later, he had started a company called Native Decor.

Related: 6 Great Tips For A Successful Shark Tank Pitch

As a start-up he then made the bold move to enter the inaugural season of Shark Tank South Africa. He was funded by Gil Oved on the very first episode. It was a life-changing experience, but Vusani is keeping a level head. The money helps, but he’s trying not to let it change his approach too much.

I’m doing my best not to think of Native Decor as a funded start-up. The money has allowed me to do certain things, like buy a new CNC machine, but I still try to think like a founder without money. Once you have a bit of money in the bank, the temptation exists to throw it at every problem, but that’s not how you create a successful business.

You need to bootstrap and pretend that you don’t have a cent in the bank. With a bit of lateral thinking, you can often come up with a solution that doesn’t require money. It might require more effort, sure, but I believe it creates a stronger foundation for your business. If a business can carry itself from early on, its odds for long-term success are much higher. You also need to fight the urge to spend money on things like fancy premises or extra staff. The longer you can keep things lean, the more runway you create for yourself.

Vusani Ravele of Native Decor

I didn’t enter Shark Tank just for the money. The money was important, of course, but there was more to it than that. Looking purely at money versus equity, Gil Oved’s offer wasn’t the best, but I knew that I wanted to work with Gil. Stepping into the room, my primary aim was to attract him to the business.

He wanted 50% equity for R400 000 of investment. I wanted to give away 25% for the same amount. We settled on 40% for R400 000 with an additional R3 million line of credit. It was more of the company than I initially wanted to give away, but I was okay with it, since I saw it as the cost of Gil’s involvement, which I knew would add bigger value to the business than just the cash injection.

Related: Shark Tank’s Dawn Nathan-Jones: How Leaders Who Focus On Growth Will Build Successful Companies

Investment comes in many forms. I wanted Gil to invest in the business because I realised that investment isn’t purely about money. I didn’t just want him to invest his cash in Native Decor, I also wanted him to invest his time and energy. You can get money in different places. You can create a business that funds its own growth, for example, or you can get a loan from a bank.

What an investor like Gil offers, however, is knowledge and access to a network. Money can help a lot with the growth of a business, but a great partner can help even more. By giving Gil 40% of the business, I’ve ensured that he has skin in game. He has a vested interest in seeing Native Decor succeed, and that’s worth more than any monetary investment.

True mentorship can be a game-changer if you’re running a young start-up. A great advantage that often comes with investment is mentorship from someone who knows the pitfalls of the entrepreneurial game. With a new business, it’s easy to be sidetracked or to chase an opportunity down a dead end.

Gil is visionary, and he has helped me focus on the long-term goals I have for Native Decor. He has also helped me to think big. As young entrepreneurs, I believe we often think too small. We don’t chase those audacious goals. Someone like Gil, who has seen huge success, can help you push things further and to dream bigger.

You need to dream big, but act small. It’s important to have big dreams for your business, but you should also chase those easy opportunities that can help you build traction. When I started, I wanted to try and get my products into large retail stores, but the fact of the matter was, as a start-up, I didn’t have a strong negotiating position.

There was a lot of bureaucracy to deal with. Gil advised me to focus on the ‘low-hanging fruit’ — those small gift stores that would be keen to carry my products. By doing this, I’m gaining traction and building a track record for the business. Also, I realised the importance of aligning myself with the right kind of stores. Perhaps being in a large retailer isn’t a good idea, since this is where you typically get cheap items produced overseas. Unless you’re purely competing on price, that’s probably not where you want to be.

Related: Shark Tank’s Romeo Kumalo Weighs In On High-Impact Entrepreneurial Businesses


Take note

Funding is great but it’s not all about the money. If that’s what you’re chasing you’re doing your start-up an injustice.

Watch the Shark Tank investment episode here:

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