The boss of Purplebricks this morning said that major changes at the business over the last few days have not been a restructure but a “correction”.
CEO Vic Darvey also said that the changes – which include a whittling down of Territory Owners from 100 to 43 – do not amount to a cost-cutting exercise.
Darvey told EYE: “We are investing more money into the field.
“We are not taking any money off the table, and this is not a cost-saving exercise.
“It is not a restructure, but a correction or re-set of the business.”
“We are not saving a penny from this – in fact, it is costing us more.”
He revealed that an extra £6m is being invested this financial year into people and technology.
He said: “We currently have 780 people in the field and are actively recruiting 50 more Local Property Experts. So we have a number of re-deployment opportunities for former Territory Owners.”
Darvey said that one reason for focusing on numbers in the field had been the inconsistency: “Some Territory Owners had 20 LPEs working with them, and others had one.”
In the new structure, each Territory Owner will have around ten LPEs, he said.
Darvey would not be drawn on the number of people who are leaving Purplebricks because of the changes, which also include stripping out the regional directors tier of management.
He said that because discussions are still ongoing, he is not able to quantify numbers of departures. But he described it as a “handful”.
He said: “A significant number of people want to continue their journeys with us. A handful have decided it is not for them.”
He added: “These changes have been a lot for people to take in. But they do understand why we are doing them.”
He said that the changes are designed to introduce a cohesive and improved customer experience – and to achieve the 10% market share which is the ambition for Purplebricks.
Darvey, who was speaking exclusively to EYE, communicated the detail of all the changes to Purplebricks people at 11am today.
Comments (49)
In April 2018, Purplebricks had a cash surfeit of £150,000,000. In December 2019, this had dwindled to a cash surfeit of £41,000,000. So it had burnt through £109,000,000 in 20-months. That is a £5,450,000 cash burn a month. Now it has divested itself of loss making interests outside the UK, its present monthly cash burn, some unconfirmed estimates state, is a little under £2,700,000. At that rate, it would take 13 – months from today to have zero capital.
Having listed over 60,000 instructions last year, how can Purplebricks be losing so much money? Answer the cost of running the business is far greater than the revenue it creates. Re-arranging the deckchairs will not result in this equation ever changing.
There is a reason that very few agents have television and other media campaigns – the sky-high cost, vanity comes before a fall, and though Purplebricks may be Olympic partners, I do think by the closing ceremony many in the company will certainly be for the high jump.
The final strategy, will probably Axel Springer taking the company private, and putting some people in charge who have a solid real estate and business background, maybe someone who knows the figures and can do something about them.
I just can’t see how the model works period, the very best operators in any town/city are small ( under eight members/colleagues per office ) but one person to do everything? Call centers don’t work in this trade it’s not predictable enough, everything is bespoke whatever the fee.
According to Zoopla, the last 12 months’ NETT listings for Burple equated to approx 59,300 – roughly 4590 per month. Let’s be generous and call it a round 5,000.
If Mr Stanton’s £2.7million per month cash burn is correct, then, in simplistic terms each and every sales listing is costing them £540 more than they are charging. Even if you add in a very generous 300 rentals listings per month to spread the cost over, the figure still sits at near £510 per property.
Cracking business model if ever I’ve seen one…
…they’d potentially lose less money writing prospective customers a cheque for £500 to list their property elsewhere!
Lord only knows how much Doorstops and 99p are losing on this basis – and as for SimpleSimon… GULP!!
“In December 2019, this had dwindled to a cash surfeit of £41,000,000.”
Not quite – this was the cash figure at the end of October published in the HY results in December. Also, you need to deduct final closure costs for OZ and US which were still ongoing.
It’s possible that PB have closer to 6 months cash left ?
Oh.
Dear.
brokerof?excellence? (the jury remains out on that one ……moving on!)
Where do we start with your tuppence worth?
If genuine estate agents are to set aside the mistruth, misrepresentation spun my PB in their effort to claim that they are estate agents, if we set aside those at PB commenting on how they have been shafted by PB …….THEY SHOULD HAVE KNOWN BETTER! ……because THEY WERE ON THE INSIDE!
Let’s keep setting aside all the holes, flaws, nonsense drummed up by PB as part of the PB Virtual Circus……
Let’s just focus on this one point brokerof?excellence” ……and you jot this down slooooooowly & carefully, then read it back to yourself morning, noon & night!
The employees? or self-employees? or whatever designation PB have given them ……THOSE PURPLEBRICKS PEOPLE ARE COLLATERAL DAMAGE BECAUSE OF PURPLEBRICKS CLUELESS MANAGEMENT & SAVAGE ACTIONS ……NO ONE ON THIS FORUM IS RESPONSIBLE FOR THAT.
So, turn your ramblings and spout them at Purplebricks, it is they alone who are delivering the savage blows to their own people.
I would surmise that most posters on this forum wouldn’t wish good people to be dumped from their jobs, however it would also be fair to say that there may be a percentage of sympathy lost when one takes into account how Purplebricks has tried to damage Our Industry.
Now forgive me, I’ve enjoyed our little chat here, but it’s bedtime for me. If you want a donation to buy a loudhailer so you can protest outside Purplebricks HQ at the consequences for their people following the management decision made by their CEO Vic Darvey ……count me in for a £1.
I’ve spent the last 24 hours trying to come up with a post that sums this entire sorry situation.
GPL has nailed it. No further comment necessary.
I think that must be the closest you have come to being lost for words, on this forum! 🙂
R’nd’r
Believe me, I am not lost for words – I have more than plenty to say on this sorry subject… I’m simply as sick and tired of repeating them as the EYE audience must be of reading them.
(rest of long, boring post deleted)
Wow this thread has brought the worst out in our industry. Granted, Bricks brought in some not very good agents to the market place who became listing agents who could care less post-listing. But not all of them! The vast majority are extremely talented listers and branch managers that were trained and sculpted by other good agents, and who all have provided good service for the most part. There have been many chains I’ve been involved in where the PB agent did loads of sales progression and were only too happy to do so. There are plenty others where the “traditional” agent involved has been utter horse poo. But let’s not mention that, eh? Put aside the fact they’ve stolen your market share with something the public have bought in to en masse, and they’ve nicked your good staff with a proposition that worked for them, and you were too weak as estate agents to hold your ground on fee so you all raced the onliners to the bottom instead of battling them on service……… aside from all that, there are people out of jobs or with reduced function/potential as a result of this. Some of which have been brave enough to post on this thread and many of you so called “better” estate agents have been nothing but callous a-holes. Telling people who’ve said they are upset by losing an area or job that “they knew what they signed up for” is utterly disgusting and some of you have shown exactly why the industry as a whole is failing. Public perception of estate agents is and will continue to be as it was in the 80’s and 90’s – soulless, spineless and only in it for the holy £ whilst this behaviour continues. To any PB agent affected adversely by the situation, I hope you find a result that works for you, and can only apologise for the behaviour of your peers and contemporaries on this forum. I’m embarrassed for them.
Complete nonsense…..
Its always horrendous when anyone is treated horribly- that’s for sure – and before you know others’ back stories you cannot judge all commentators either, in the way you have just now..
There are huge structural issues in these debates centred on the hypocrisy of the messages on this thread.
Yes there are **** agents – there are **** people in every profession – surgeons too if you watch the news.
The point here is that PB people were out for the upfront cash, the easy life promised, the get rich quick, the flexibility of working hours etc etc
They became condescending about a profession that has become an industry – they supported the devaluing of a profession that added value when things become difficult in a transaction; they lowered public perception of what the best agents do.
Blinded by the pot of gold at the end of the rainbow they took people’s money, they joined the pyramid they abandoned the principle of being paid for success.
Only two people have walked away with the gold to the tune of £140m apiece.
The rest are disciples of a once populist sect – now deemed useless by its own parishioners
To some extent J1 I agree. But there are some decent agents there, who were blinded by the Bruce bros, blinded by the thought that just doing their job they would earn more money. At some point or another, we’ve all been blinded by an amazing salesman haven’t we? How many on this thread signed up to On The Market, for example?
I’ve seen some really good agents go to PB/YOPA/Easy/HouseSimple/Emoov etc, with varying degrees of success, many of which I would give the instruction to if I were selling my house over and above some of the high street agents that sit here and boast about a superior service yet in actual fact themselves are no better. I see dozens of “high street” agents stick a house on rightmove and hope for the best. To tar all of these with the same brush is just as unfair as the commisery advert is to “proper” estate agents. Some agents, whether online, corporate, high street, independent, whatever label you want to put on them, are just ****** good or ****** bad agents and everything in between.
Whoever you work for, and whatever you do, there’s no place for sneering at people who have just lost jobs or opportunities. We, as an industry, should do so much better.
Agreed it is horrid when people’s lives unravel; but don’t forget the damage that the rhetoric peddled by these people for so long has wreaked on good quality professional businesses over the last five years…..for what?
To drive down prices in an era of rising costs for law abiding tax paying (NI; PAYE; P11D) professional firms….
The tax authorities should have taken a keener interest in this model….. If they had, more fantastic agents would be employed right now – many have lost their jobs indirectly because of firms like PB and others
I’ve been popping in/out of this thread today ……as I need to do that estate agency thing as well as get PIEye’d
The irony here…… PurpleBricks sponsoring Olympic TEAM GB, and yet their own brand is hiding an Olympic sized shambles.
PB’s business model is built around massive marketing spend, yet behind the scenes it’s a corner shop, a very badly run corner shop. The Quirkster spent other people’s money spinning the Emoov Plates, until the fakery ran out of steam and the plates came crashing down ……and he slipped away (one hopes that he will still be held responsible for his sins).
Vic & Co are fumbling around, trying to plug the leaks, trying to fix the crumbling walls by papering investors money over the cracks, and as always the employees? …..or not employees?? …….are the ones that are sacrificed as collateral damage.
PURPLEBRICKS are a SOAP OPERA, a CAR CRASH, a CREAKY SHIP ADRIFT, slumped mournfully in THE LAST CHANCE SALOON …..Insert Your Own Description Here ______________
What WE ALL KNOW is that Purplebricks are NOT ESTATE AGENTS. The poor souls aboard this shambles of a virtual ship have every right to feel that they are being shafted ……because they ARE being shafted!
Vic? …….you have no idea what you are doing. Take your Clown Mask off, turn off the Spotlight, lower the Curtain, and shuffle off quietly.
That famous phrase “You’re a Kite dancing in a Hurricane” ……give Vic the T-Shirt …..he has earned it.
“… get PIEye’d …! – I like that!
At the end of the day; this bunch of whining LPE’s TO’S whatever they call themselves have been taking money off people and delivering little or no professional service to their clients throughout the transaction element of the house sale process for years.
To many qualified professionals this is what you deserve for buying into a perverted concept of taking cash and not delivering.
I am really sorry that many will not like this; but agency is about people and solving their problems; it’s about adding value, not taking it away.
Good luck selling second hand cars; you have been well trained for your next career boys and girls…….
You have no idea how hard the agents work, the ones they have let go are qualified, they are ex high street branch managers and they worked really hard. It was their rubbish post sales part of it that let them down.
Now though they are replacing the good agents with car sales men and inexperienced youngsters who can take houses on and not bothered about selling them
By joining in the first place they knew full well there was no post sale agreed support.
Once “good agents” chased the cash up front and abdicated the tough part of the job, the part where agents earn the fees they charge.
Taking pretty pictures for Rightmove is not Agency……..
Taking money and providing no service for it is appalling ……..
Best thread ever, watching the Purple Palace burn down with a front row seat.
I’m embarrassed to admit I used to admire the Purplebricks model, changing the industry for the better, however in light of recent developments, I’m appalled that this Vic has any strength in the business and one he has no experience in.
Disgusting to undervalue your people and replace the high earners with what you call academy? 1 year of doing viewings qualifies you to value people’s homes?
No regard for your customers
Disgusting treatment of your agents
Lying to your share holders!
And lying to new starters!
Are you mad Vic? Or are you really an undercover competitor trying to tarnish this business?
Having spoken with a number of people directly involved with this. I can only sympathise. A very important point raised around security. I know of 20 previously self employed associates that have left keys at HQ. Circa 1600 clients where PB have ‘keys’ with no records no security, even worse on the Lettings side. Any PB clients should be concerned any change in personnel would mean no one knows where the keys are !
Also 3 people had left over 5 months ago and PB have neglected to collect keys as no one to perform this.
Susan Piles / Verona Monkfish / Vic Derby take a bow !
I left as a ‘over worked and exhausted’ LPE this week, in this ‘mist’ of all this going on. I made my 100 poor vendors aware I was leaving and my TO would be taking over, who knows the area well. My TO is now demoted to a LPE and my stock is in limbo with newly appointed ‘Territory Operater’ that isn’t local to me, keys in limbo, completions today with no-one taking ownership! No planning, no clue, terrible way to treat your workers but also feel desperately sad for all those vendors who bought into me, my knowledge, my local experience, they thought they had my support…..I feel so sad that it has ended this way. There was no way I could carry on working 7 days a week, 14 hours a day less than 25k. I could give no more. I feel I have let down all my customers, buyers and sellers. But, unfortunately Purplebricks have let down me too, with a more support in the field, all could be so different. I believe the ‘New Purplebricks’ is greedy. Greed will be the downfall.
Whilst I sympathise with you on a personal level to call the “new purplebricks” greedy is naive in the extreme. The Bruce brothers knew exactly what they were doing and executed their plan superbly, this is the direct consequence of that. Ask yourself why the original TOs were given a five year licence ? The Bruce brothers rode of into the sunset with their millions and left everybody else behind to fend for themselves.
Dont blame the new bricks blame the old bricks
Just had a thought…. All those vendors who have been passed onto another unmotivated LPE now… They chose the agent cause they liked and trusted them as the PB model relies on that and now they have gone that means some poor new LPE has inherited that and will have it add to their existing stock list with little or no knowledge of the property.
I personally think that if the LPE leaves or is gone the vendor should have a refund of some sort as its a model that relies heavily on the individual LPE as to the success and ease of the sale.
I was based in Dorset and someone is emailing my old clients and stirring up trouble. I’ve had 3 calls today from upset customers.
I’ve also heard that at least 2 TOs still have access to the platform and are circulating information to outside sources on what’s been going on internally.
Both have reported back hand payments to troublesome leavers (to keep quiet).
This is the start of the slide.
Kenny and Michael both promised me a business that I could build and ultimately sell, to live my happily ever after.
Yesterday I was told that my licence has been pulled, I am now demoted to LBP status and to cap it all off, my RD now owns my area?!?
This is not the company it was and the shoddy way we are being treated is appalling.
I, and a few others are forming a group litigation to challenge this
Presumably you believe that Elvis is still alive if you believed all of that……….?
My best friend believed in the simple life sold to him too – he is earning less than £1000 a month and has to pay for his car and everything else too……….not good times at your coal face…..
ExTOgirl, really sorry to hear of this. Any idea how many people have been let down like this? Is it the handful Vic describes? If ever there was a case for not being self employed this is it?
That ‘handful’ is a cheap dilution of the facts. There’s at least 30 or 40 that I’ve heard about. I think there’s almost 60 in total, all demoted (some have just left).
My ability to earn is severely impacted. It’s disgusting.
Obvious of your area being in the know…. However You certainly should look at litigation as well as IR35.
On a more lighter note, what is funny to see is T.Os for years pitched how it was an equal partnership and signed LPE’s up on “business partner” agreements but you now refer to being an LPE is “demoted”…..kinda hypocrisy at its finest.
Curveball… What if I told you the plan being executed was Kenny & Michaels plan originally and even set in motion by them years ago….
It is truly appalling the way PB are treating their ‘people’.
I hope that the press get hold of this and make their conduct known to the public. It is a scandal that I believe there would be considerable interest in. Their practice is ruthless and dishonest. They have no care for either their workers nor for their customers. It is all a big con..
Good luck with the litigation- hopefully enough people will get together to make it happen.
Did someone say litigation?….yes please!
Their website shows less than 650 LPEs /LREs.
It is not possible to see how many of the LPEs/LREs are F/T or P/T.
If Vic had a brain for Running an Agency from Experience he’d be dangerous.
Luckily for the industry, he doesn’t.
Why do they need to do go to all this trouble in order to ‘ introduce a cohesive and improved customer experience’. Surely, with their 5 start Trustpilot rating and ever increasing masses of satisfied customers, they’ve already nailed the whole cohesive customer experience?
Great point!
Taking Vic’s stab at interpreting what he is doing – I’m guessing he spells his name as
ICV
VCI
CIV
or maybe, it’s just VIC ?
Can anyone explain the technical differences between a ‘correction’, ‘business re-set’ and a ‘restructure’….asking for a friend.
Vic says – “It is not a restructure, but a correction or re-set of the business.”
We say – “or a load of nonsense Vic”
The demotions seem to be going down well…
Lots of licenced business partners fully motivated, and working seven days a week non-stop, to help make this company a success.
How could it fail?
Blah Blah Blaaaaah Vic
Hoist the lifeboats people, Vic’s going under
Spoiler
I was scrolling down with the intention of saying blahhh blahh
Some of the TOs are pretty talented people and will, Im sure, secure new positions witth Trad agnets very easily. the more ex PB agnets we have talking honestly about the PB model the btter-its great news.Happy Frday !
Maybe he ought to be addressing shareholders .Vic seems to be more concerned that the market sees this as a cost cutting exercise rather than a failing management structure and not fit for purpose .
What he is saying is that its a pig’s ear and should imagine that the LPEs must be cheesed off in a challenging market for some fatcat TO to cream off their share .for their efforts. The TO only claim is having being first through the door when the territories were being dished out not because of their skillsets
On the other end of the scale the unfortunate TO Tato posting yesterday who suffered a number of issues with too many postcodes and didn’t have1 good word to say about them
Finishing off with
” I genuinely hope this is the beginning of the end.”
” We currently have 780 people in the field ”
” We currently have 780 people in their bedrooms ”
Fixed that for ya
Hes right its not about cost cutting but it is a bold move. The new territory owners will be richer than ever and called “territory operators” and long term they will not be on the road or appearing on websites etc. They effectively replace regional directors on a small scale and potentially the most lucrative and easiest job in agency…
I don’t know how it will pan out but the changes have not been taken well and a lot of loyal and good agents have decided to move on or be moved on. Great time to be a rival in my opinion as a LPE’s most dangerous opponent in the living room pitch is an ex LPE I can assure you.
I imagine lots of stories becoming public over the next few weeks once people decide where they are going etc
Either way to the public its more negative press at PB and something the public are becoming aware of. The lack of consistency is a huge issue in most areas and over worked LPE’s who have remained will see no benefit to this restructure other than a Territory Operater with an even bigger area trying to stretch them even further in regards to covering areas and numbers.
As for the 780 he must be including Assisted viewers which is code for “part time mum” or “i know sweet FA about property but I can open the door”
On closer reading the statement above says ‘We currently have 780 people in the field’. So there will only be approx 430 moving forward.
43 TO’s with on average 10 LPE’s each.
Can we have an illustration so we can see that nicely shaped Purple Pyramid
It’s high time this virtual/doortodoor pretend property listing farce was exposed for what it is
43 TO’s with on average 10 LPE’s = 430 LPE’s. I thought that they had over 600 odd LPE’s. Where are the ‘missing’ 200?