When a franchise model is implemented correctly, it can be a powerful thing. So powerful in fact that even small independent builders can successfully expand beyond their original borders. Jonathan Jackson speaks with G.J. Gardner Homes CEO and Managing Director, Darren Wallis, about the builder’s ever expanding international footprint.
The most successful businesses are the ones that seize opportunities. Sometimes those opportunities come as a surprise, other times they arise through the hard work of everyone involved in a business. For G.J. Gardner Homes its success has been due to a mixture of both.
Darren started at G.J. Gardner Homes’ in 1994 as the company’s accountant, involved in the daily running of the business and working closely with founder Greg Gardner. Together, they helped grow a well-respected home building business with six regional offices in South East Queensland.
At the time, they were proud at what they had achieved and the future of G.J. Gardner Homes, but it wasn’t until one gentleman walked through the doors with an out of the box query, that a whole new perspective and consequent opportunity was revealed.
“This gentleman had been speaking with someone at the Housing Institute of Australia (HIA) enquiring about how to set up a franchise in the construction industry; they advised him to seek out a large building company to talk about franchising. So, he came to us,” Darren says.
That chance meeting and unexpected query, gave Mr. Gardner something to think about. He and Darren approached the other office managers at G.J. Gardner Homes to vet their opinions.
“We spoke to six other managers and all bar one said that if we were to go down the franchise path, they wanted in. So we franchised the business and within three months we went from being a corporate builder to a franchisor.”
Darren says the fundamental change to G.J. Gardner Homes was that employees essentially became stakeholders with a great incentive and vested interest in growing the business.
“We had stakeholders and we could expand quicker, but we could also give back to the industry by giving small builders the opportunity to grow their businesses from building three houses a year to 150 houses or more. This was a great growth strategy, particularly as it was our aim to become a national business.”
It wasn’t just domestic plans that were on the agenda. An international viewpoint was also put forward. New Zealand was a logical move.
“We placed an advertisement with a New Zealand paper and we were inundated with people wanting a franchise. Greg said we needed a master franchise to look after them, so that same day I rang a mate of mine, met him in Noosa and we sat down and worked out the deal on the back a napkin.”
Some of the best deals are worked out on the back of a napkin and G.J. Gardner Homes is now the biggest builder in New Zealand, developing 1000 houses a year. Once they saw what could be done in New Zealand, Darren and Greg knew it could be done around the rest of Australia.
“At the time, we didn’t have brand recognition outside of QLD, so we thought if we could emulate the brand throughout Australia, we could then grow in the US. It came down to implementation.”
US Calling
Darren became the Director and Partner of G.J. Gardner Homes in 1996 and in 2000 he went on to take 
the top job, appointed as the Managing Director of the company. He has spearheaded growth and expansion in Australia, New Zealand and the United States and in last financial year alone, his company sold more than 4000 homes achieving more than one billion dollars in sales.
“That was always our plan to go to the US,” Darren says.
It wasn’t easy, however. Apart from uprooting his family, he faced regulatory and compliance issues, problems such as changing the modeling from metric to imperial and dealing with a whole new industry. However, the same altruistic sentiment to help small builders develop the skills and strategies to grow their businesses remained.
“In 2008, I jumped on a plane to the US and said ‘we are here now, let’s set up’. My wife and two kids were in tow and I began to modify the plans and systems to meet US requirements. It was a step-by-step challenge, but I felt if we could make it in California where building regulations are some of the strictest in the world, we could make it anywhere. I helped write a lot of the agreements and worked closely with franchisees to help them understand the process and get it running. It has definitely been worth it in the long run.”
The expansion across the US is one of Darren’s proudest achievements and he is over there half a dozen times a year to ensure things are going smoothly.
“From being a small builder in South-East QLD, to go across to the US and have over 30 offices building a few hundred homes is quite an achievement,” he says.
It is a particular achievement because when Darren went over in 2008, with his family, a dream and a two-year visa, the world was turning.
“The crash had happened, so I decided to support the team. I lived in Denver and there were hundreds of builders going broke over there. “We went into the GFC with 11 offices and only lost one with one other changing hands. All the rest were able to batten down the hatches during that period and ride out this financial storm.”
Darren says it was in part due to the systems that G.J. Gardner has in place.
Building a connectivity solution
The technology system G.J. Gardner has implemented for its franchises covers everything to do with construction. Darren can see exact sales and start dates and what the company needs to do about jobs. Darren played a fundamental role in developing this program, working closely with a computer programmer until it met their business needs.
“We looked at estimating systems, scheduling and CRM but there was nothing that effectively linked everything together. So we decided to build our own system and we continued to rewrite it over the three-year period coming up to Y2K. We invested heavily into finding this solution due to a vital business need. We needed a system that would support a franchisee rolling out 150 houses each year; logistics are streamlined, there was no double entry and it is simple to create balance.
“We have always tried to be at the cutting edge with our software. In the past not many builders were using technology, it was all spreadsheets and basic programs; but we wanted a key resource to give to builders to monitor their jobs and now we have software that talks and applies to each of the regions we occupy.”
The face of the franchise
As a franchisor, when looking for builders to join the business, Darren wants people who have passion and attitude. They need the determination to do what it takes to grow their business and change their lives. In fact, he is looking for people who mirror his own entrepreneurial attitude.
“It is rewarding to see a small builder become part of our team, follow the G.J. Gardner system and become hugely successful,” Darren says. “We have had builders join the family and within a few years, have become the biggest builder in their town. I had one franchisee say to me, ‘you said if I follow the system I would earn x amount of dollars, well guess what? I earned double that’.”
G.J. Gardner Homes system are the product of years of meticulous planning that are proven to work. Their growing team of builders and franchisees are a testament to the company’s success.
“The ability of our systems to change and adapt has been invaluable. When our expansion begun, there were too many overheads; but after looking at the affect this was having on franchisees’ profitability we were able to quickly make changes to rectify and improve our systems in no time. We steered clear of the spec market to ensure we have contracts enabling our builders to know exactly what a customer is paying.”
That is the type of systemisation and dedication to business and customer that has won G.J. Gardner Homes so many accolades.
In 2013, G.J. Gardner Homes won the award for Excellence in International Franchising from the Franchise Council of Australia (FCA) and this year, Darren represented the company on the round table at International FCA Conference in Las Vegas. About 17 new franchises have opened in the past 24 months – with more than 4000 homes sold for a gross sales value of over $1.2 billion in the 2014/15 Financial Year, the company is going from strength to strength.
Darren himself has also shared in several accolades. In 2001, he was awarded the prestigious Young Accountant of the Year Award and in 2012 was listed in the CPA’s ’40 under 40 Young Business Leaders’. Yet he is humble.
“The awards are mostly a result of our franchisees. We look for franchisees with passion and attitude; guys who are proud of what they do and put effort into their housing. Most of the awards are at that franchise level.
Winning International Franchisor of the Year has led to recognition from the franchise industry and has meant a lot for G.J. Gardner Homes.
“It is a great achievement for any Australian company to be recognised for our strengths in franchising on a global scale. As a homegrown building company, that made the transition to franchising; we are so proud to represent the construction and franchising overseas for Australia.”
Looking to the future
Darren says there are good times ahead for the construction sector. The market is booming in Australia, solid in New Zealand and on its way back in the US.
“Looking at Australia, if you are not busy now you will never be busy. There is a cyclical nature to the building industry; NSW was undersupplied for 10 years and it has finally come back and there are now a lot of major infrastructure projects that are being pushed through.”
The franchisees of G.J. Gardner Homes will pounce on this opportunity as the company looks to further expand across the US and eventually into Europe.
“We specialise in taking each franchisee and giving them the tools to become the biggest builder in their market. If we continue to implement this strategy across the globe, we will, one day, be the biggest homebuilder in the world.”
This is a lofty ambition, but it is being overseen by a man who has a hand in a number of businesses including renovations, fit-outs and even coffee and donut franchises. He is the kid who would mow lawns, breed pigs and birds and chase any business opportunity presented to him.
G.J. Gardner Homes is in the hands of a goal setter who achieves remarkable results, day after day, year on year; which is the best place for any franchisee to be. BFM
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