Professional Carwashing & Detailing

Writing in favor of franchised quick lubes

July 17, 2006

Writing in favor of franchised quick lubes
Jim Brown

Franchised quick lube operations offer a support system unparalleled in independent operations. After 20-plus years of experience as an independent automotive repair business operator, I have found that franchised operations offer a platform of services that truly benefit their operators.

These include:

  1. Proven operating system;

  2. Training support for both technical and business management;

  3. Ongoing operational and technical support;

  4. Real estate and development support;

  5. National marketing support;

  6. Earlier opportunity potential achievement;

  7. Brand recognition and customer acceptance;

  8. Improved return on investment;

  9. A forum for continuous improvement; and

  10. Community involvement.

Statistical Canadian Market Place facts have proven that the success rate of business ventures launched under a recognized brand have a significantly greater success rate.

Starting a franchise

The first consideration in choosing a franchised business opportunity is to evaluate your own interest in the opportunity and accessing the impact on your personal and family situation.

Once you have decided on the quick lube segment of the automotive servicing business as your career choice you will soon discover the many values of a franchise.

A franchise provides brand equity and customer acceptance of the value of the offer. This assists in realizing your location's business potential in a shorter period of time.

Along with this you are investing in a proven operating system that can justify the cost of entry and be supportive of your growth. This is extremely important if your background experience is more technical in nature than business management.

The franchisor's real estate and development group provides invaluable support and effort to ensure the site location matches the known customer demographics for success. Hours of operation are set as a result of analyzing many locations and markets and are reasonable for family values while providing the optimum potential for profitability.

Maintenance and facility care requirements are well-articulated and documented to support the long term value of that investment and respect all environmental requirements. Insurance requirements are identified and competitive pricing is provided.

Building a franchise

People are a key component of the service provider's success and franchisors support this through ongoing comprehensive training programs, performance guidelines, on-site support by trained personnel, staffing models, group benefits and salary and reward programs that support a motivated team.

Opening inventory levels are provided and ongoing needs are met through constant monitoring of chain sales. New sales and service opportunities are researched and suppliers are evaluated prior to any roll-out. Customer needs are evaluated to ensure business value and offer need and integrity.

These processes and volume-buying ensure that everyone in the brand receives the best product cost and supplier service. Tracking of customers, sales, inventories-by-product and service categories, promotion redemptions along with peak service periods are all available from a proven point of sale (POS) system.

A POS system is a key component in tracking and measuring your progress and a valuable tool in understanding your successes and identifying opportunities to improve profitability. Experienced franchisor area managers utilize this information to ensure the franchisee's success.

Marketing

Franchisor marketing support is formulated to ensure brand integrity, provide ongoing customer awareness and drive volume. This is normally done with input through a franchisee committee process to ensure franchisee and customer needs are addressed. This supports and ensures long-term business growth.

The debate over franchise and marketing fees as a cost is not valid. Identifying these as costs implies there is no return. They are in fact an investment that provides a return for a long period of time and bring economies of scale that are beyond the average independent business owner.

These fees provide the training, products, systems, marketing, community involvement, technology research and business management processes that normally are only readily available in larger corporations that can afford the expertise required in the above areas.

A positive attitude and a high level of execution, added to the above, will provide an above average level of return on investment, a comfortable lifestyle and additional growth or investment opportunities.

As an independent operator you gain most of your experience by trial and error. Time and money must be spent developing the systems provided by a franchisor.

As a franchisee you are able to evaluate the opportunity prior to entering into a long-term deal, receive accounting support and cash flow management, financing needs and assistance in lender presentations and an understanding of the business capacity for repayment.

There is always risk in any venture. Minimize that by joining a proven quick lube system loaded for success. Understand that the franchisor has a vested interest in your future.

Jim Brown is vice-president of Franchise and Community Relations for Mr. Lube of Canada.