Maaco has announced its plans to expand its business model across America. The company says its growth strategy stands to significantly increase the number of franchise licenses it plans to sign in 2018 – increasing its total by more than 50 percent over 2017, which resulted in 45 new licenses.
“We’ve injected an innovative collection of tech-forward business processes and systems into the Maaco business model. That’s what is driving an immense amount of interest in the franchise opportunity and why we are bold about expectations for our franchising initiative,” said Dennis Elliott, vice president of development and franchising for Maaco. “In fact, intrigue is strong on two levels for our brand – individuals and teams looking to build a business with strong ROI and growth potential, and sophisticated investors looking to grow rapidly through the consolidation and acquisition of mom-and-pop shops. Maaco is becoming a critical part of the business lifecycle for our industry.”
More than 30 percent of the brand’s growth in 2017 came from acquiring and rebranding independent paint and collision repair shops, versus just 10 percent the year prior. Updated to Maaco’s brand standards, the converted locations often have the benefit of cash flow from the get go. With consolidation continuing to gain steam, Maaco anticipates an even larger percentage of new store growth coming from this non-traditional avenue.
The company says franchise momentum is building with investors seeking to take command of the paint and collision repair sector in undeveloped Maaco markets. Maaco adds that its appeal today extends to sophisticated investors with marketing and sales experience suited to invest in and grow the brand. The franchise is set up to run with simple operations, high margins and impressive profitability – $200,000 take home income on a $400,000 initial investment and average unit volume of $1.3 million. On average, franchisees are earning 15 percent profit margins.
“Our business model has weathered every economic storm, coming out stronger and stronger and showing each and every time that it is truly resilient to every scenario. And, most importantly, the business is able to take advantage of the most beneficial of conditions,” said Elliott. “Same center revenues are growing consistently year over year and have been positive for more nearly a decade. Through our support systems, we’re committed to removing uncertainty.”
A significant aspect driving unit economics is the brand’s fleet and industrial services. Intended for both national and local fleets, Maaco supports franchisees with sales and marketing programs that directly target this segment. It has become the fastest-growing portion of sales systemwide.
Maaco’s franchise offering includes opportunities for single and multi-unit investors for agreements of up to five units. Targeted growth territories currently for franchise agreements include: Denver, Birmingham, Alabama, Cleveland, the Bay Area, Las Vegas, Los Angeles, Louisville, Phoenix, Boston and Pittsburgh. These markets, as well as several others throughout the country, will play host to several openings in 2018, beginning in the first quarter of the year.
