Geared for Success: Meineke Car Care Centers
Meineke Car Care Centers, Inc. may have started as a single store offering a single product, but today the one-stop-shop offers complete car care repair services that customers have come to know, love, and trust.
Founded in 1971 by Sam Meineke in Houston, TX, the brand began as a muffler shop, but as the exhaust industry started to decline Meineke quickly adapted to become a complete service car repair shop.
Now offering services in brakes, tune ups, diagnostics, under car repairs, tires and exhaust, as a part of the Driven Brands family Meineke has successfully built its automotive business franchise system with over 960 locations throughout the United States, Canada and Mexico.
Providing franchisees with market share, national advertising, financing assistance and recession resistance, the renowned Meineke brand provides its partners with a broad range of services, hands on training, and a unique system that’s geared for business success. While the automotive industry has grown significantly since 2000 and is projected to grow through 2016, part of the reason for this trend is that consumers are holding onto their cars for longer periods of time and miles driven. This results in increased maintenance and repairs.
“Auto repair is what we provide in terms of service, but Meineke is a retail oriented business and it requires sophisticated marketing to customers, as well as incredible customer service,” says Dave Schaefers, Senior Vice President of Franchise Development of Meineke.
“We want to be the preferred automotive provider so we focus on growing the company through customer retention.”
As over 60 percent of the business is from repeat customers, growing this base is critical to company growth. “In order to gain repeat customers franchisees need to provide an environment where the customer trusts us,” he explains, adding, “It’s about the brand experience on a retail level.”
Seeking franchisees to join the brand, Meineke is looking for individuals with a background in business, marketing and management. While automotive experience is not required, instead franchisees need to be able to manage and hire great staff. “In our business people are everything, so franchisees need to be able to evaluate and train their staff,” says Schaefers. “They need to be able to put the aces in their places, it’s critical when opening a store.”
Franchisees must also be dedicated to overseeing the facility, ensuring it’s run the way the business system is documented. “Meineke is not a wallflower business where a franchisee can sit back and let things happen. They
need to be active or hire management that is active within their local communities, get to know local business members and be engaged within their market.”
Over the several years the company has started working with multi-unit franchise applicants, and recently sold out Phoenix, AZ with a 20-license package. “In addition to our traditional buyer, Meineke is bringing in a different level of buyer, someone who can develop an entire region. In response to this we’re offering license and royalty discounts as incentives for the right candidates to grow with the company,” explains Schaefers.
The cost to purchase a Meineke location ranges between $250,000 to $275,000. This includes equipment, inventory, license fees, and working capital. Working with VetFran, Meineke offers a 25 percent discount to Veterans, and to date has approved over $800,000 in discounts. “The average discount per Veteran is $7,500, which means we have done well over 100 licenses with Veterans,” says Schaefers.
A fan of signing on Veterans because of their experience in a highly structured, mission-driven system, Meineke believes this experience coincides with their ability to follow a process, which at large is what franchises are based on. “If someone follows a franchise system, they have a very good chance of being successful with their business,” explains Schaefers.
A great example of a Veteran who has found success with Meineke is Tom Perez. Coming to the business after serving in the military for 14 years, Perez has followed the franchise model and is seeing incredible results. Meineke’s franchise licensing process is extensive and relies on cooperation and participation from the Meineke Leadership Team. Requiring franchise approval from the sales, real estate, financing, legal, and operations teams, as well as the President of the company, the entire process takes four to six weeks to complete.
The process begins as soon as a candidate expresses interest in purchasing a franchise, at which point they are indoctrinated into the company to ensure it’s a good fit for both parties. Filling out a preliminary discovery questionnaire including financial information, if the candidate passes the first round of approval they will then review the FDD and FTA before attending a Meineke presentation and discussion. Practicing due diligence, the candidate will next contact other franchisees to learn about their experiences with the company.
Meineke also provides a very detailed and well thought out Item 19 Franchise Performance Representation.
“During the process we direct candidates through company operations, marketing, training, buying, funding, and opening,” explains Schaefers. “If all goes well the candidate will identify the market they are interested in and we’ll investigate the area using our geographical analytics. Next presenting the candidate to the company, we will review their file and determine approval.” Once all departments have agreed that the candidate is fit to run a franchise, they are then awarded a license. Once approved the entire Meineke team will know where the new franchisee hopes to grow, and how many units they are looking to open. Assigning an experienced Field Real Estate Representative, this individual assists with identifying approved locations based on cost, geographical location and potential impact on other stores. Meineke’s Financing Manager will also help with funding requirements and an assigned Project Coordinator will arrange signage, equipment, inventory, training and the grand opening.
Attending the two and a half week training program at Meineke University approximately one month prior to opening, here franchisees learn the company’s operations from the store level to marketing, accounting, human resources, and more. Additional support is provided through Meineke’s Internet system dealer, which provides access to over 100 training courses, videos, and the operations manual. An open forum is also available for franchisees to engage with other owners, ask questions and post comments, and the operations team will be present during the franchisee’s first week of store opening.
“Last year the company set records with licenses awarded and 2014 looks to even stronger,” says Schaefers. Identifying the top 25 markets in which Meineke would thrive, 50,000 registered vehicles are required per store. Noted in this list are Los Angeles, Dallas, and Houston. Hosting “Building Our Brand Together” road shows in markets with a demand, Meineke has made these events two-part days. Dedicating the morning to presenting new prospects with a detailed presentation, the afternoon is dedicated to existing franchisees. “We invite franchisees within the market to show them where we want to expand, and give them the first opportunity at growth,” explains Schaefers. Meineke’s strategy of meeting with new and visiting existing franchisees in demanding markets has assisted in doubling the company’s sales efforts over the last two years.
Setting the brand apart from its competition, Meineke is different on two levels. On the franchise side the company’s focus on transparency with where the company stands and how they plan on growing is key. On the consumer side Meineke’s dedication to educating the consumer is the differentiating factor for the brand. “Our ‘Drive a Little Smarter’ campaign educates customers at the store level about why their vehicle needs to be serviced. This builds trust in the automotive space, which will eventually create long term benefits for our franchisees,” explains Schaefers.
With 40 years of experience in an industry that is continuing to thrive, the automotive space is a terrific area that provides a simple-to-follow playbook that Veterans can use to leverage their skills and succeed. “With franchising you’re not reinventing the wheel,” says Schaefers, adding, “Franchising is on a strong rebound from the lull in 2008, and it’s in a good spot now from both an opportunity and financial perspective. Overall it’s a great time to become a franchisee.”
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