With 29 stores now operating and several more ready to open their doors, tire and wheel franchise operation Rent-n-Roll Custom Wheels and Tires is in an expansion mode throughout the U.S. and beyond, according to founder and President Larry Sutton.
The Tampa-based company has just completed agreements with franchisees in California, Indiana, Kentucky and Washington state, Mr. Sutton said, making a total of 13 states in which it has made some sort of franchising accords. It has agreements pending in ``19 or 20'' more states, he added, as well as a pending contract to award one franchisee the Rent-n-Roll franchise for all of Canada.
Besides the 29 Rent-n-Roll stores now open, there are 147 already under contract to open within the next five years, Mr. Sutton said.
The 30th store, in San Diego, is set to open by the end of June. Following staff training at an outlet in Bakersfield, Calif., Mr. Sutton announced June 27 that a Rent-n-Roll store there would open in July. He signed a franchise agreement with ``rent to own'' veteran Les Pearsey, who said he ``can't wait to get open and blow the doors off of California.''
Mr. Sutton, who owned a furniture-and-appliance rent-to-own business before retiring in 1998, started Rent-n-Roll in October 2000, getting the idea from a rent-to-own tire and wheel store in Texas. The idea behind the business is simple: Motorists, rather than buying tires and wheels outright, can rent them through weekly, biweekly or monthly payments and will own them at the end of the payment period. Rent-n-Roll's Web site promises no down payment, no hidden charges and free installation.
``We didn't re-invent the wheel...just the wheel business!'' states the ``Business Opportunities'' section of the Rent-n-Roll Web site. The site promises prospective franchisees ``the BEST franchise support in the business,'' including marketing and advertising support and hands-on training.
``What we generally do is offer market development agreements with guys who'll develop the territory,'' Mr. Sutton said. Whether for a city or an entire state, Rent-n-Roll makes agreements with franchisees granting them Areas of Dominant Influence (ADI). These ADI agreements give franchisees the sole right to open Rent-n-Roll outlets in the areas granted in the contracts.
``We don't want to make this like Subway, where one guy has one store and another has another one across town,'' Mr. Sutton said.
In general, an ADI agreement can be for as few as four Rent-n-Roll stores, or as many as 30, according to Mr. Sutton. The basic franchise fee is $25,000 down plus a 3-percent royalty to the company, although the franchise fee will be reduced for multiple stores, he said.
The average return on a Rent-n-Roll outlet is $1 million-plus annually in sales, although some sites make considerably more, according to Mr. Sutton.
What about customers who don't buy the tires and wheels-and perhaps ``forget'' to return them?
Mark Spicer is manager of a Rent-n-Roll outlet in Bradenton, Fla., one of the company's four ``core stores,'' all in the Sunshine State. These outlets are operated by the company while franchised stores are located out of state.
He told Tire Business he uses his outlet's pickup truck more as a ``rolling billboard'' than as a collection vehicle. Mr. Spicer does use it to occasionally pick up tires and wheels from customers.
But he added that he only spends ``about 60 bucks a month on gas, so that should tell you that most people bring the stuff back.
``Ninety-nine percent of our customers return the merchandise.''
Mr. Spicer also noted that business is booming.
Tire Business Managing Editor Sigmund J. Mikolajczyk contributed to this report.