Purplebricks (LON: PURP) shares are declining on Tuesday after the announcement that it intends to move to a fully employed model for its field sales agents, with the transition commencing today.
The online estate agency long had a model where its Local Property Experts were classed as self-employed.
However, the company said it now believes moving to a fully employed model will ensure that it can scale up quickly to meet consumer demand.
They claimed to already have “created a talent pool of over 100 of the best agents in the industry who are ready to join it as opportunities arise.”
The company also said that its medium-term guidance remains unchanged in light of the change to its operating model. However, they are expecting to incur exceptional non-recurring costs of £3-4m in FY22, with ongoing administration costs expected to be £1m higher in FY22 and beyond to support the increased size of the team.
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.”
Purplebricks shares are currently down 2.88% at 69.1p.
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