Rune Sovndahl runs a home services business, and has scaled up dramatically in a short space of time – but he has learned some lessons along the way. He told Real Business why, when it comes to suppliers, honesty is the best policy.
Fantastic Services is a one-stop shop for all home services, including cleaning, gardening, tradesmen, builders, removals and pest control.
Rune Sovndahl, the CEO and co-founder, started the business back in 2009 when he spilt wine on the carpet of a flat he was renting. Later that evening, at a party, he got talking to his now business partner Anton Skarlatov – who had an interest in the domestic services industry.
“In exchange for help finding the best carpet cleaner, I advised him on his website. We then realised that there were so few professional cleaning services and that there was an immense need for a more tailored approach to the industry,” said Sovndahl.
In a relatively short space of time, the business has scaled up quickly, and now employs around 500 people and operates various franchises.
Running a large operation and relying on franchisees can create challenges – namely, how do you keep the levels of quality up, and build consistency across a brand?
Choosing the right suppliers is a key part of this, and they need to be relied upon to deliver in even the most urgent cases.
“If they don’t deliver on time or hold insufficient stock for us, this turns into real financial losses for the company. Missing or cancelling jobs due to this (among many other reasons) could furthermore harm the brand’s name and bring down future sales,” said Sovndahl.
Fantastic Services: Selecting a supplier
These days, Fantastic Services has a supplies and logistics coordinator in charge of procurement as a lot of stock and equipment is required to fulfil the extensive range of services. The starting point when choosing a new supplier is always pricing, stock, and availability of next day delivery.
“Some suppliers tend to make lots of mistakes, especially when dealing with urgent requests and high demand. They fail to deliver on time (sometimes more than once for the same order/on the same address), or lack communication and planning skills.
“The way their accounting department works with us is also very important as we subcontract most of our teams. If the supplier delays our invoices we delay invoicing our subcontractors which can sometimes create more unwanted tasks for our credit control department.”
Fantastic Services: Switching a supplier
Recently, Fantastic Services switched one of its main detergent suppliers. This was due to a pricing concern – the supplier upped its prices and blamed the change on Brexit.
“However, our other suppliers not only managed to beat those prices but gave us an all-time low pricing on some products. Our main supplier then gave us the same pricing as them which only showed us that we’ve just been overcharged with Brexit serving as an excuse. We still use them but only for certain products,” said Sovndahl.
Fortunately, the new supplier has been a successful match; Fantastic Services is rarely given the wrong product or a delayed delivery.
“They walk the extra mile for us, bend their delivery schedule if needed, stock more even if it seems risky on paper and are very fast in their communication,” he said.
“With more than 2,000 Fantastic pros on the team and running out of supplies on a daily basis, we need suppliers which can act fast when needed without making false promises.”
Overall, Sovndahl’s advice to a businesses seeking a new supplier is to make honesty a priority – a supplier which is honest and realistic with an estimate is more reliable, whereas false promises will only lead to problems later down the line.
“Make a mental note of mistakes and failings and see if that’s hurting your business financially or is it something you can live with – we all make mistakes.
“If that’s really the case and at the end of the day the supplier is hurting your business, try building a relationship with another supplier with a similar (or better) product range.”