This Franchise Has One Very Big Problem: January

By Tam Goldsmith

Christmas Decor makes most sense when winter leaves another business with people and equipment to spare. Its seasonality may be the reason operators buy it.

Christmas Decor has built a franchise around a rush of demand that disappears almost as quickly as it arrives. For many of its operators, however, the short season may be the reason the business makes sense.

If you were designing the perfect franchise from scratch, you probably would not choose a business where customers all want the product at roughly the same time and then lose interest almost overnight. That is pretty much what Christmas Decor has been selling since it began franchising in 1996.

The business professionally decorates homes and commercial properties for Christmas. Its teams design displays, supply and install the decorations, maintain them during the season, take them down afterwards and store the products until they are needed again. Then January arrives and nobody needs their house made more Christmassy.

It sounds like a fairly obvious flaw until you look at who is buying the franchise. Christmas Decor says many of its franchisees already operate seasonal businesses, including landscaping and other outdoor services. Those owners can have vehicles, employees, customer relationships and overheads already in place when their usual work starts slowing down.

For them, the awkward season is part of the attraction.

Why Are We So Frightened of Seasonal Businesses?

Franchising likes predictability. Recurring memberships, subscriptions and steady year-round sales make investors comfortable because they reduce the importance of any particular week or month.

Christmas Decor does not offer much of that comfort. Its franchisees know perfectly well when demand is coming, and they also know when it is going away. Their job is to make enough money while customers care.

That changes the economics for somebody who already owns another service business. A landscaping company may still be paying for vehicles, management and other overheads during winter even though those assets are producing less revenue. Adding Christmas decorating gives the operator another service to sell without necessarily building an entirely separate company from scratch.

That is more interesting than trying to pretend the franchise is not seasonal. The business is seasonal, and anybody buying it needs to be comfortable with that. The attraction is using a concentrated period of demand to make people and equipment more productive when they might otherwise be sitting around costing money.

It also raises a question that franchising does not ask often enough. Why should every franchise have to occupy an owner for 12 months of the year? If one business fills the quiet period of another and the combined economics work, the calendar matters less than the return on the assets already being paid for.

This Is More Than Someone With a Ladder

Christmas Decor's current franchise material says packages start at $7,900 plus a territory fee, with territory fees ranging from $7,900 to $18,900. That should not be mistaken for the complete cost of building an operation. Labour, vehicles, equipment, products, storage and working capital still have to be considered, particularly for somebody starting without an existing service company behind them.

The franchisor's April 2025 franchise material reports average gross sales of $418,607 among franchisees operating for more than five years. It also reports an average new residential sale of $2,253, customer retention of 79% and estimated net profit of 41%.

Those are figures supplied by the franchisor and they need to be treated accordingly. The average sales number applies to established operators that meet the stated criteria, while somebody opening a new territory should not assume they will reproduce either the sales or profit figures. A prospective franchisee needs to examine the relevant FDD disclosures and understand exactly how each figure was calculated.

What the numbers do establish is that professional Christmas decorating can become a substantial service business. Christmas Decor says its network has more than 250 locations across North America and collectively serves more than 40,000 customers.

The customer is buying more than somebody turning up with a ladder and a box of lights. The service covers design, commercial-grade products, installation, maintenance, removal and storage. For customers who have neither the time nor the inclination to spend a weekend untangling lights and climbing onto the roof, there is an obvious reason to pay somebody else.

Christmas Creates an Operations Problem

The biggest risk in this business is easy to understand. A lot has to go right in a very short period.

Christmas Decor says appointments typically fill by mid-November. Crews need to be recruited and trained, products ordered, schedules organised and installations completed before the customer starts wondering why they are paying for Christmas decorations that are not yet on the building.

There is very little room to recover from mistakes. A landscaping job that slips by a week may be irritating. A Christmas installation that slips far enough can become pointless. Weather, sickness, damaged products or a crew running behind schedule can therefore create problems that become increasingly difficult to fix as December approaches.

The franchisor reports average daily production of $3,361 for a three-person crew in its current franchise material. For an operator, production capacity may be more useful than the headline network numbers because demand only matters if crews can physically complete enough work while the season is still worth selling.

That is why anyone considering the franchise should be asking how many installations a crew can complete, how long new installers take to train, what happens when somebody is absent during peak weeks and how much money has to be committed to products before customers have paid.

Behind the Christmas lights is a fairly unforgiving labour and logistics business.

Once a Year Can Still Be Recurring Revenue

There is another assumption worth challenging. We tend to think a good repeat customer should buy frequently, but frequency and longevity are not the same thing.

Christmas Decor reports customer retention of 79%. A residential customer may only need the service once each year, but if that customer returns for several Christmases, the relationship can still become valuable. The decorations are already stored, the business knows the property and the customer already understands what they are buying.

Commercial customers can make that equation more interesting. Hotels, restaurants, shopping centres, municipalities and dealerships may have larger properties and a stronger reason to create a professional display without diverting their own staff into installing it.

For a franchisee, the real value is therefore not simply what a new customer spends in December. It is how many of those customers return the following year, what they spend when they come back and how efficiently the business can reinstall or expand their displays.

If the franchisee has to rebuild most of the customer base every autumn, the short selling season becomes considerably more dangerous. If a large proportion returns, the same season begins with revenue already within reach.

The Franchise May Make More Sense as a Second Business

This is where I think prospective buyers need to be particularly careful. Christmas Decor can be discussed as a franchise opportunity, but its economics may look very different depending on what the buyer already owns.

An established landscaping or outdoor-services operator may already have managers, vehicles, storage, employees and thousands of local customer relationships. The additional cost of introducing another service can therefore be very different from that faced by somebody arriving with none of those things.

That makes this an unusually good example of why franchise opportunities should not always be assessed as standalone businesses. An average return calculated for one type of operator may be almost meaningless for another.

It also puts some responsibility on the franchisor. If the strongest economics are achieved by existing service-business owners who can share costs across two operations, prospective buyers should understand that before investing. A low headline entry price can look very different once somebody has to acquire all the infrastructure an established operator already has.

The sensible due diligence is therefore personal. A buyer needs to calculate which costs the Christmas Decor operation can share with an existing business, which costs are genuinely additional and how much cash the combined operation needs during the months when decorating revenue is low.

January Isn’t the Problem If You Planned for It

Christmas Decor has not discovered a way to make Christmas happen twelve times a year, and there is no point pretending it has eliminated seasonality. The business makes money during a concentrated period and then becomes much quieter.

The more useful point is that this does not automatically make it a bad franchise. For the right operator, concentrated demand can put otherwise underused people, vehicles and customer relationships back to work. A business that looks badly unbalanced on its own can make considerably more sense when it sits beside another one with the opposite seasonal pattern.

That is why I would be wary of buying Christmas Decor simply because the photographs look fun and the entry price appears relatively modest. The interesting buyers are the ones who can explain exactly what their staff, vehicles and customers are doing before the first Christmas Decor job arrives.

Franchise investors are routinely told to look for year-round demand. Christmas Decor suggests that may be too simplistic. The better question is whether the business makes productive use of capital and people when they would otherwise be doing very little.

If it does, January is not necessarily a problem. It was part of the plan from the beginning.

What We Can Learn From This

Franchise investors should consider how a new opportunity fits with assets they already own instead of assuming every franchise must stand alone. Christmas Decor can give established service operators another use for labour, vehicles and customer relationships during a quieter period, but the short installation season makes capacity, staffing and customer retention critical. Prospective buyers should calculate the economics using their own shared costs rather than relying on network averages. As labour and equipment become more expensive, franchises that make existing assets productive for more of the year could become increasingly attractive.

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