The New Home for the Crafts Industry

This family does not only preserve the company’s heritage but also supports developing current strengths, resulting in a collective collaboration driving mutual growth and stability.

Since we were established as a group in 2020, we have succeeded in increasing our revenues by more than sixfold. This was made possible through positive organic growth, coupled with a targeted and effective strategy of welcoming new companies in Norway, Sweden, Denmark and now, through successful market entry, also Germany. 

With revenues significantly weighted towards renovation and maintenance and a diversified portfolio of companies we ensure that we limit our exposure to fluctuations in the new builds market. Despite short-term market challenges, Håndverksgruppen is well-positioned in attractive and stable markets in Europe with good growth prospects. Nonetheless, we continue to follow market developments closely and execute on corrective actions, both locally and centrally, when needed. 

New companies who join HG almost immediately benefit from improvement in both revenue and profitability. This boils down to the way we operate. Put simply, we leverage our scale to learn from each other’s competencies, develop common best practices, share resources and negotiate long-term purchasing agreements. 

This is how we intend to continue building the new home for the craft industry in the future. 

We’re a partner and home for successful crafts businesses

HG operate with a decentralised model and has a selective approach to invite new companies to join the group. For a company to appear on our radar, it must be a well-established winner in its local market. Why so? We recognise the fact that proximity to local, satisfied customers and employees must not be affected by a company joining HG. 

Companies that join us retain their identity. Their company name, logo, and offices remain the same. For us, it’s a way of preserving several centuries’ worth of history in painting, tiling, masonry and flooring. Incorporating existing companies in this way is an important element in value creation for the group. By welcoming new companies, we increase our geographical presence, opportunities for collaboration and knowledge sharing, as well as diversification. 

Many of the companies that join HG have missed being part of something bigger. Either they have lacked a network of colleagues to lean on and learn from, or they have not had the capacity to develop their employees besides in the craft they are performing. This changes when they join the group. 

To ensure that operational levers can be pulled quickly and deeply, we have developed a comprehensive General Manager's Toolkit. This toolkit, along with targeted training, is being offered to the General Managers after joining. The toolkit both eases the transition to HG and enhances opportunities for further growth. The toolkit leverages our scale and includes favourable purchasing arrangements, shared expertise through best practice and resource sharing, and centralised handling of regulatory documentation and requirements. 

Being part of the HG network enables companies to bid together for contracts that would be difficult to secure independently. New members quickly experience the benefits of integration into our wider community, benefiting from the guidance of hands-on regional managers who facilitate both formal and informal interactions.

Unleashing the power of best practices

At HG, sharing best practice is fundamental to our success. First and foremost, this involves the sharing of local expertise within the HG network, enhancing our collective capabilities. We also support our local businesses with resources at the service office that provides tools in the areas of pricing, project management, contractual guidelines and sales support. As we are at the beginning of our journey, the full potential of these best practice opportunities remains largely untapped, and we anticipate significant margin growth as we continue to evolve.

The HG Academy is more than just a learning centre for best practice; it's a place where these principles are deeply embedded in the growth and development of the employees. It equips our craftspeople with a comprehensive set of skills, from achieving pricing excellence and project management skills, to learning about the different disciplines and embracing the culture. This holistic approach provides them with the practical tools they need to succeed and underpins the HG philosophy that knowledge sharing, and continuous learning are key to collective progress and individual achievement.

A national player out of the ordinary 

The demand for national contracts within the B2B segment is increasing. The need for transparency and control of the supply chain is also increasing consistently, as is the need for centralised cost and quality control. The growing appeal of being able to manage numerous services across different regions through a single operator may seem challenging, but it presents a promising opportunity for HG to strengthen its competitive edge and expand its presence in the industry. We see that the demand from national agreements remains stable, despite wider market fluctuations. 

Throughout 2023, the Group has won five large national customer agreements in Norway, which has been a source of great satisfaction for our local companies as it adds profitable local revenue. We have an excellent proposition to serve local markets with local companies through a single point of contact. Looking ahead, there is still untapped potential for national agreements in Norway, but especially significant opportunities for national agreements in Sweden and Denmark. When the time is right, we will follow the same path in Germany.

We invite you to read more about why Storebrand chose HG as their partner in this report. 

Eliminating organizational hurdles for organic growth

In our industry, organic growth often hinges on the availability of skilled labour—a challenge we at HG are determined to overcome through strategic initiatives focused on local recruitment and retention.

We've launched recruiting campaigns and platforms in Norway and Sweden, showcasing HG's dynamic culture through employee stories, attracting talent and enhancing our community spirit. Plans to extend these efforts to other countries are underway. Recognizing the potential in unskilled workers, we offer on-the-job training and apprenticeships, diversifying our talent pool.

At HG, apprentices aren't just trainees; they are our future. With a long-term goal of 12% of our workforce comprising of apprentices, we're investing in the next generation of skilled professionals. Our commitment to their growth and development is unwavering, ensuring they receive the support and guidance needed to flourish. For more insights into how we work with apprentices, refer to the later sections of this report.

Succession planning is integral to our long-term vision. While our current cohort of local General Managers, with an average age of 49 years, boasts extensive experience, we're mindful of the need for a new generation of leaders. Through initiatives like the "Greenhouse Program," launched in 2023, we're nurturing emerging talent, equipping them with the skills and knowledge to thrive in leadership roles.

Our people-centric approach and emphasis on continuous learning have not gone unnoticed. With an Employee Net Promoter Score (eNPS) of 32, well above the industry average of 11, we've cultivated a workforce that's not only engaged but also committed to our shared success. This positive workplace environment not only enhances our ability to attract and retain talent but also strengthens our competitive position in the market.

Growing with one new company every two weeks

On average, we have been joined by a new company every two weeks since our inception. Going forward, we intend to maintain the same average pace in including new companies.  

Our plan for the coming years is to complement our positioning in Norway and Sweden and significantly increase our presence in Denmark and Germany. To accomplish this, we are using the expanding network of existing HG companies and a wide variety of databases and other sources to find attractive candidates. The result is a strong pipeline with solid companies in all our focus disciplines and areas.

With the German market being about three times the size of the combined markets of Norway, Sweden, and Denmark, we have a significant growth runway for the years to come. In Germany, we are considered unique from our competitors thanks to our decentralised model and the fact that our people and culture sit at the heart of everything we do. 

Looking even further into the future, we believe that the neighbouring countries to Germany could just as well be a good place to continue our journey, having already met with companies who confirm this view. 

Sustainability from Day One

Since HG was founded, we have made it a priority to integrate sustainability into every aspect of our business. 

By supporting the ESG agendas of both the group and the local companies at the same time, we are creating a ripple effect of positive change. This includes, among other things, limiting our footprint by ISO certifying our companies, mapping our scope 1 and 2 emissions and driving a lasting change throughout the industry with code of conduct trainings of our employees. Recruit and develop apprentices is also an integral part of our ESG strategy. You can read more about our ESG strategy and how we follow-up our apprentices later in the report. 

Our local companies are now able to take bold steps towards a more sustainable future that they may not have been able to achieve on their own. 

We see an increasing appetite and requirements from our customers to deliver on the ESG agenda, giving us a competitive advantage in our prospects to win larger national agreements and as partners to insurance companies. Through our more professionalised approach to ESG we are thus creating value for our customers, a quality that has likely contributed to our Net Promoter Score (“NPS”) of 69. 

We are proud craftspeople leading the way.