Meineke target: double systemwide sales by 2018

CHARLOTTE, N.C. (March 7, 2016) — Driven Brands Inc. wants to double the systemwide sales of its Meineke Car Care Centers brand by year-end 2018 by expanding the U.S. store network 50 percent to 1,400 locations and growing each store's average revenue.

Meineke President Danny Rivera laid out the franchisor's goals March 7 in a telephone conference call, during which he also announced the launch of the Meineke Rewards program, which awards customers points for their patronage that can be redeemed for services and/or parts.

Mr. Rivera said Meineke expects to add franchisees in three different ways — recruiting new franchisees the “traditional” way, attracting entrepreneurs to the potential of the automotive aftermarket; incentivizing existing franchisees to open additional stores; and by recruiting institutional investors looking for a decent return on their investment.

The automotive aftermarket in general and Meineke specifically have only scratched the surface of the latter of these three avenues, Mr. Rivera said. Such investors often have resources to consider opening multiple outlets at the same time.

Mr. Rivera declined to be too specific about Meineke's expectations regarding the potential revenue growth of existing stores, but he did say Meineke envisions growing the tire share of a typical store's sales mix to 20 percent by 2018 from less than 5 percent currently.

Moving forward, Mr. Rivera said Driven Brands wants Meineke to be perceived as a “world-class retailer,” a goal the company said can be achieved by becoming more customer-focused, more in tune with the changing shopping habits and demands of today's “connected customers.”

As such, Driven Brands wants to address three fundamental customer needs — reliability, transparency and convenience.

Charlotte-based Meineke sees “reliability” as the “price of admission,” Mr. Rivera said.

Transparency — or trust — is how Meineke franchisees can retain customers. “If we can lay things bare, customers can trust our name,” he said.

To enhance the network's image along these lines, Meineke has tested and is starting to roll out an electronic full-vehicle inspection process, Mr. Rivera said, whereby the service technician conducts a standardized inspection using a tablet or Ipad, noting anything that potentially needs attention and photographing areas of concern.

Once finished, the report is emailed to the cutomer. Imbedded in the report are links to prepared visual or video presentations on the suggested service, allowing the cutomer to bone up on that particular item.

Meineke pilot-tested this in three stores last year and has it running in 10 stores now, according to Mr. Rivera. The next target is 50 stores by the end of the second quarter.

This type of service leads to the third customer want: convenience, Mr. Rivera noted.

“‘Convenience' will define us,” he said, referencing the modern customer's insistence on “push of a button” response.

Along those lines, Meineke is evaluating the feasibility of instituting a “we'll pick you up” service available to customers through the brand's new mobile app. Customers could schedule a service appointment, and the local Meineke franchisee would send a driver to pick up the car and bring it to the store.

The customer would be kept apprised of the progress of the service call throughout the day. The vehicle would be returned to customer before the end of the business day, provided there was no additional service required.

Last year Meineke awarded more than 100 franchise licenses, 65 of which opened locations, the company said.The company also shifted its advertising/message to: "Meineke: On with life," and rolled out a series of TV and internet ads that drive home the point: "Taking care of your car shouldn't take over your life."

The initial investment levels for new franchise locations range from $225,000 to $275,000, Meineke said, with top-performing stores averaging more than $700,000 in annual sales.

Meineke took a major step toward building its tire business two years, establishing a buying program called “Meineke ExTRA,” in partnership with Cooper Tire & Rubber Co.

Last year the Meineke network serviced roughly 3 million cars, performing 1.9 million oil changes, 106,171 tune-ups and 92,726 tire rotations, to go with 202,283 tires sold.

On a philanthropic basis, Meineke and its franchisees donated more than $122,000 to charity and provided more than 20,000 free oil changes to veterans, according to the company.

Mr. Rivera was named president of the Meineke brand in October 2014. He joined Driven Brands in 2012 as chief information officer after working at AutoNation, one of the world's largest car dealership chains, and General Electric Co., Motorola and