# Purplebricks to move its local property agents to fully employed status

- Link: https://www.directorstalkinterviews.com/purplebricks-to-move-its-local-property-agents-to-fully-employed-status/4121015987
- Published: 2021-08-10T07:08:20+01:00
- Author: Giles

**Purplebricks Group plc** (LON:PURP), the UK’s leading tech-led estate agent, announced
today that it intends to move to a fully employed model for its Field sales agents,
with the transition commencing today.

**Updated business model to support growth**

Since its foundation in 2014, Purplebricks’ disruptive model has resulted in the
Company achieving the position of being the best-known and largest estate agency
brand in the UK in its drive to deliver on medium-term market share targets.

The Company launched new pricing structures in July 2021, including a Money Back
Guarantee and a simplified two-tier proposition. The national roll-out of these 
structures is underway and, as previously guided, the Board remains confident that
these strategies will accelerate revenue growth, increase market share and drive
progress towards the Group’s medium-term targets over the coming years.

The move to a fully employed model for Purplebricks’ agents represents a further
enhancement to the Company’s business model, following a review of how the Company
can best serve its customers, support its field teams in the future, and meet the
demands of a strong market.

**Strategic rationale for move to fully employed status**

The Board now believes that moving to a fully employed model will ensure that the
Company can scale up quickly to meet consumer demand and, to that end, the Company
has already created a talent pool of over 100 of the best agents in the industry
who are ready to join it as opportunities arise. 

Having ownership over the recruitment, training and management of a unified high-
performing team will support the delivery of a consistently high level of service
to Purplebricks’ customers across the country, including an enhanced opportunity
to increase ancillary revenues.

Additionally, it will provide greater security and benefits to incentivise Purplebricks’
agents. The Company’s newly employed sales team will enjoy a highly incentivised
package with the ability to work flexibly and remotely, in keeping with the Purplebricks
entrepreneurial ethos and changes to ways of working that have come about because
of the pandemic. Agents will also benefit from the rights that come with employee
status as well as having access to many new opportunities for career development
and growth.

**Outlook and guidance**

As guided in July 2021, it remains too early to quantify the benefit from the new
pricing structures to the current financial year.

As a result of the move to a fully employed model, the Company is expected to incur
exceptional non-recurring costs of c. £3-4m in FY22, with ongoing administration
costs expected to be c. £1m higher in FY22 and beyond to support the increased size
of the team.

The Board is committed to driving market share growth and there will also be significant
increased investment in a new marketing campaign later this year, with the result
that marketing costs for FY22 are expected to be c. £3-4m higher than previous guidance.

The Company’s medium-term guidance remains unchanged, and the Board continues to
expect Purplebricks to be able to deliver annual revenue growth in excess of 20%
in the medium-term, with confidence in the Group’s ability to deliver against its
growth strategy.

> **Commenting on this announcement, Purplebricks CEO Vic Darvey, said: **
> “I am proud to be announcing plans to make our sales team permanent employees.
> The pandemic highlighted the challenges of being self-employed for many people–
> which is why we created the £2.2m fund to support the agency field during recent
> challenging times. As normality returns, we believe that moving to a fully employed
> sales model will benefit and support our people and make Purplebricks fit for 
> the future.
> Not only will this enable us to better protect and incentivise our agents, it 
> will also allow us to scale up quickly to meet consumer demand, and continue to
> deliver a high quality, locally based service for our customers. It will also 
> ensure that we can continue to drive a more consistent, high-performance culture
> and experience for all of our customers, helping us deliver a next generation 
> estate agency service to buyers and sellers alike.
> The Board strongly believes this move will increase market share and enhance performance
> in the coming years.”

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