In 2019, Norwest entered the home services market by backing Mike Andreacchi and his junk removal franchisor Junk King. In the two years since, Mike and COO Lisa Merry have built a thriving platform with more than 125 franchisees and $100 million in system-wide revenue, growing despite a challenging market for many brands.
Today, we are proud to announce that Junk King has been acquired by Neighborly, a world-class organization backed by KKR and Harvest Partners. We know the Junk King-Neighborly partnership will prove to be quite successful. Our confidence comes from observing the Junk King leadership drive growth first hand, even motivating us to invest in other home services franchisors such as Poolwerx.
Here are a few humble observations from our partnership with the Junk King team:
1. Durable business models matter, especially now.
COVID pressures, economic uncertainty –brands have faced many challenges in recent years. Through these headwinds, Junk King has grown its B2B and B2C services, demonstrating the persistent value that quality home services offer consumers. In the case of Junk King, the value proposition is a fairly priced, do-It-for-me alternative to an omnipresent issue (just look at your garage or backyard!).
2. In consumer services, brand and execution win.
We have been lucky to back three franchisors across fragmented industries:
- The Learning Experience (early childhood education)
- Junk King (junk removal)
- Poolwerx (pool services)
In all three cases, strength of brand and consistency of execution have been a winning formula. At Junk King, management drove tremendous success at both the franchisor and franchisee levels, ensuring a delightful customer experience. Fair pricing, reliable crew, consistent messaging, and responsive contact centers at a national scale drive a virtuous customer cycle that creates success for all franchisees.
3. Aligning interests in franchising is paramount.
It’s an obvious statement, but in franchising aligning incentives, investment, and outcomes is key. At Junk King, we and management worked hard to ensure the franchisor invested heavily in the franchisee. From highly effective technology investments and local online marketing programs to new product initiatives, the team knew that corporate investment dollars would drive sustained franchisee growth. The subsequent franchisee success makes for more investment-minded franchisees, which benefits all.
We applaud the scores of Kings’ Club winners (annual recognition for outstanding sales volume) across the years and recognize that Junk King’s 125 franchisees will generate more than $100 million in revenue this year. The franchisees’ success is the franchisor’s success, and vice versa. It’s a terrific partnership.
We have enjoyed our partnership with Mike, Lisa, and the entire Junk King team. We wish them all the best in their next chapter with Neighborly.