Deathwatch: HomeServe broken beyond repair?
British home repair and insurance crew HomeServe are not having a good time of it. Revenues have been hit hard, thanks to a big delay in marketing thanks to concerns it may be misselling products.
The company had already suspended telesales in the UK, so they can review marketing techniques and retrain sales staff. Alas, they reopened to thousands of customer complaints and now it seems like 200 jobs will be axed as they restructure.
Shares in the FTSE 250-listed group have been dropping like sacks of cats, not helped by the fact that the chap who owns HomeServe doesn't see anything wrong with commuting to work by helicopter every day. Allegedly, allegedly.
The biggest concern is the misselling, and the decision to suspend telesales came after a report by Deloitte showed concerns over how some products were being sold to customers. HomeServe passed the report onto the Financial Services Authority and volunteered to suspend its marketing while it got its house in order.
"Our dialogue now is the ongoing day-to-day dialogue rather than about the UK issues that we identified at the end of October," Chief Executive Richard Harpin told Reuters.
All this restructuring and outsourcing will cost the company around £20 million this year, and with customers potentially looking elsewhere, things could be pretty bleak for HomeServe.