Hello Everyone

[Gattaca]

[quote='PJK' pid='29098' dateline='1348257944']
[quote='Gattaca' pid='29095' dateline='1348227158']

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I sadly cannot afford to buy the kitchens myself cash, and I am sure a start up company won't get a credit line for more than 3/4 kitchens at a time with a pretty terrible discount. I aim aiming to do 25 - 30 fits a month in the first year.

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25-30 fits a month ...... I have so many questions I'm not sure where to start !!

Later perhaps when I'm not at work.

Daniel

25 -30 fits per month nationally, not individually. I should have made that clear

.....sorry whats the difference ?

25 kitchen fits is 25 kitchen fits, no ?

True, I am looking at a national figure in the medium term when we have approx 50 independent local fitters across the country. With centralised support from me and my team, confirmed local supply chain I am sure this is achievable.

This will be a national offer, but delivered on a very local level, hence the importance of getting the package right for local fitters.

Thanks for your feedback,

Phill

[nsk]

Hello NSK

I had not considered using different localised suppliers as I wanted to create the easiest path for the fitter. My assumption was based on around a one stop shop for the fitter to pick up everything in one go. Once the business builds it gives me more leverage on discount for the local fitter also.

I like your idea though as the the buyers would respond to the "better quality at similar price point" as you have suggested. Would the local suppliers who have mentioned be able to deliver the goods in the timescales I have mentioned i.e supply from stock or with 24 hours?

Thanks for you suggestion, It has really go t me thinking.

Hi Phill

I can only speak for my own company, but other than painted ranges we can have pretty much anything within 24hrs (as long as we adhere to daily cut of times)

I assume you are thinking of replacing any damaged items within a 24hr window and not the entire stock for the job?

If you can set yourself up with local companies and assuming you would be giving them a steady flow of work they should be more than accommodating with last minute requests etc. The company who make my carcasses can make me a cabinet on the day I ask for it on most instances, the doors etc I can have by 10.30 the next working day (and sat am).. So unless I order on a Friday after 3pm I will have it the next day which can be quite convenient.

[Blue_Joe]

My contract with the house seller would agree the deduction of the whole contract cost from house sale proceeds OR from the exchange deposit monies

There is such a massive flaw with this though as I see it....

This means that the cost of kitchen and its fit becomes amalgamated with the cost of the house. If that fit is a £5K (or worse if more) and if the buyer has bought the house at the current market value or a touch on the high side and then the kitchen will add 5K or 10K on to the house sale price to pay for the kitchen and the surveyor will not take that into account unless you can convince him that the kitchen will add that much to the house value. In turn he goes back to the mortgage company valuing it for less than the sale price this in turn means the mortgage company will not lend against the full amount. And in the current housing market climate that is a VERY real danger!

The absolute danger is that then your business model starts causing house sales to fall through, if this happens more than the odd time your reputation will preceed you and any house seller will not even entertain a buyer that comes wanting to use your proposition!

I can tell you what my answer would be to a buyer if asked if I was willing to that would be - and I wouldn't need time to think about it!

Just my 2p!

[Gattaca]

My contract with the house seller would agree the deduction of the whole contract cost from house sale proceeds OR from the exchange deposit monies

There is such a massive flaw with this though as I see it....

This means that the cost of kitchen and its fit becomes amalgamated with the cost of the house. If that fit is a £5K (or worse if more) and if the buyer has bought the house at the current market value or a touch on the high side and then the kitchen will add 5K or 10K on to the house sale price to pay for the kitchen and the surveyor will not take that into account unless you can convince him that the kitchen will add that much to the house value. In turn he goes back to the mortgage company valuing it for less than the sale price this in turn means the mortgage company will not lend against the full amount. And in the current housing market climate that is a VERY real danger!

The absolute danger is that then your business model starts causing house sales to fall through, if this happens more than the odd time your reputation will preceed you and any house seller will not even entertain a buyer that comes wanting to use your proposition!

I can tell you what my answer would be to a buyer if asked if I was willing to that would be - and I wouldn't need time to think about it!

Just my 2p!

Hello Blue Joe,

This is a very valid point and the business I worked for previously came unstuck with this problem as they 'inflated' the house value to take into account the improvements, trying to convince surveyors that the house would be worth more after works have finished. I would point out this company refitted kitchen, bathroom, all floor covering and complete redecoration ( which made the project management,.....err....challenging/chuffin impossible)

My concept differs. The price deduction is taken from the eventual proceeds of the house sale. If the agreed price is downvalued by a surveyor, both the seller and buyer need to renegotiate the price, but the kitchen package price remains unaltered or removed completely ( If a seller chooses not to go ahead with our package, but proceeds with the sale we levy an admin fee split with our local fitter on completion, this fee is to cover initial visit & CAD plan costs)

My experience of sellers trying to sell houses with poor kitchens is that have to continue to reduce their price to even lure a viewing. When a potential, buyer does visit, they want a price reduction to apply to the whole house even though with a new kitchen it would make the house more desirable.
The Royal Institute of Chartered Surveyors own research suggests that a new kitchen can improve a properties value by around 4.5% but this should be a tool to help the buyer as the concept really offers house sellers an option to substantially improve their chances of selling, not to improve the price they will get.

Another aspect of the current house market is potential buyers access to cash. It is recognised that the bigger deposit they put down on a house equates to a better mortgage rate and this in turn leaves little money for home improvement post sale. My suggestion is that the house seller 'uses' the equity built up in the house to offer an attractive, personalised option to a potential buyer.

You make a very valid point and it one of main things I have worked on before I moved toward the fitting aspect of the idea.

Many thanks for your post

Regards

Phill

[Blue_Joe]

I appreciate the points your making, but there is still one point you haven't touched on that I brought up and a few others.

You may be able to convince a seller that it is an attractive offer to put to buyers - I can see the attraction to potential buyers but

This work your saying will be carried out post exchange and pre-completion. Do you really think you are going to be able to convince the seller that on top of taking a chunk of the sale money (I appreciate the arguement that the kitchen fit may get the seller a better price) but on top of that they need to more than likely move out early, which in turn means putting house Clints into storage. This is another large expense as short term accomodation is not cheap yes some can move in with family and friends but not always possible.

This is another expense that needs to be covered and dependant on the house and requirements could be into thousands.

Finally the ultimate risk is that the sale falls through. An exchange of contract is not final, only means that the buyer loses the deposit. That may cover the cost of the kitchen, but will it cover ALL costs incurred, especially if the seller has moved out early and considering all the other costs that can be incurred from the other side of their move if in a chain???

Its a risk to any seller when they are the ones covering the costs!

[Gattaca]

I appreciate the points your making, but there is still one point you haven't touched on that I brought up and a few others.

You may be able to convince a seller that it is an attractive offer to put to buyers - I can see the attraction to potential buyers but

This work your saying will be carried out post exchange and pre-completion. Do you really think you are going to be able to convince the seller that on top of taking a chunk of the sale money (I appreciate the arguement that the kitchen fit may get the seller a better price) but on top of that they need to more than likely move out early, which in turn means putting house Clints into storage. This is another large expense as short term accomodation is not cheap yes some can move in with family and friends but not always possible.

This is another expense that needs to be covered and dependant on the house and requirements could be into thousands.

Finally the ultimate risk is that the sale falls through. An exchange of contract is not final, only means that the buyer loses the deposit. That may cover the cost of the kitchen, but will it cover ALL costs incurred, especially if the seller has moved out early and considering all the other costs that can be incurred from the other side of their move if in a chain???

Its a risk to any seller when they are the ones covering the costs!

Hi Blue Joe,

Another relevant and real question that Clints will ask.

We achieved over 60 of these types of sales in my previous role and when sellers were in residence ALL of them either moved with family, took rented property early or found alternate accommodation but you are correct that it adds another pressure at the critical moving time.

My focus for the business initially will be empty and probate houses which are in most need of this service, it where we would add the most tangible value and is easiest for our partner fitters. Around 200,000 probate properties come to the market every year plus another 40,000 come to the market when the owner has to move to a supported environment/care home. I know this type of client well and have personally been involved in over 2,000 sale's to this type of client. I could count on one hand the number of their properties that had a kitchen which would improve their chances of selling.

These customers invariably have full equity but are asset rich and income poor ( all is tied up in their house) so I believe this to be an elegant solution to their particular problem.

When Clints are in situ it is more difficult but if they a re motivated to move and their buyer want our package, I think the upheaval is a small price to pay. We would find out the house sellers intentions and make this agreement of their alternate accommodation prior to even having a partner fitter do the initial site visits. If the seller cannot agree to these terms I would not list the house with our package.

In respect of the sale falling through AFTER exchange of contracts I have only experienced this once in over 20 years. We would be liable to be paid through the deposit monies and I would guarantee our local fitter payment 100%. You are right that there is risk involved here, but I have tried to mitigate as much as possible.

Cheers

Phill

[Lady_DIYer]

Hi everyone,

new to the whole forum thing, but this one seems to have lots of good info and advice! Look forward to getting more involved. One of the reasons I joined the forum was I wanted to see if anyone could point me in the direction of somewhere that allows you to basically self assemble but with your own measurements....

Maybe a bit like an online IKEA but with made to measure furniture and fittings? There must be one surely??

Looking forward to hear back from you all

[PJK]

Hi everyone,

new to the whole forum thing, but this one seems to have lots of good info and advice! Look forward to getting more involved. One of the reasons I joined the forum was I wanted to see if anyone could point me in the direction of somewhere that allows you to basically self assemble but with your own measurements....

Maybe a bit like an online IKEA but with made to measure furniture and fittings? There must be one surely??

Looking forward to hear back from you all

Hi LD,

Welcome to the forum. You are best to start your own thread to introduce yourself

[Lady_DIYer]

Hi everyone,

new to the whole forum thing, but this one seems to have lots of good info and advice! Look forward to getting more involved. One of the reasons I joined the forum was I wanted to see if anyone could point me in the direction of somewhere that allows you to basically self assemble but with your own measurements....

Maybe a bit like an online IKEA but with made to measure furniture and fittings? There must be one surely??

Looking forward to hear back from you all

Hi LD,

Welcome to the forum. You are best to start your own thread to introduce yourself

Thanks for the tip will do so now :-)