Getting on the Franchise FAST TRACK - Page 4 of 4
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Getting on the Franchise FAST TRACK

of consumers are holding on to their cars longer while others seem more likely to purchase pre-owned vehicles. According to a 2007 National Automobile Dealers Association report, new-vehicle sales for 2006 were 16.5 million, a near 3% decrease compared to 2005 unit sales. And nationwide, franchised new-car dealers sold more than 19 million used vehicles last year.

Judging by these figures, car owners seeking out automotive repair and _service facilities for routine maintenance and upkeep will make for a strong market. And there are a myriad of nationwide franchise automotive repair and service chains that offer parts, and/or full-service repair at rates more reasonable than dealerships and often with a quick turnaround.

“Automotive franchises are kind of coming in and taking over. Convenience and cost are the main factors,” says Larry Hecker, president of the Automotive Maintenance and Repair Association, a Bethesda, Maryland-based group of repair shops, parts, and equipment suppliers, car companies, consultants, and other organizations that represent the automotive repair _industry. “People like convenience, so if an independent repair shop is closer and _cheaper than the dealer, they will use it.”

The impact these franchises have on the automotive industry goes beyond _vehicle sales. Total service and parts divisions of nationwide franchised dealerships also report a decrease in sales, going from $85 billion in 2005 to $80.5 billion last year. NADA attributes the decline to the steady increase of competition from independent service stations and quick-lube centers, which of course cuts into dealerships’ service work–a prime _opportunity for prospective franchisees.

According to the IFA, franchises to watch in this category include Matco Tools (www.matcotools.com), Meineke Car Care (www.meineke.com), and Midas International (www.midas.com).
–Additional reporting by Nicole Norfleet

FASTEST-GROWING FRANCHISE SECTORS
Specialty/Gourmet Foods: 130.7%
Auto–Electrical and Battery: 29.6%
In-Home Health Care: 28.3%
Health–General: 23.5%
Business–General: 21.2%
Window Repair and Services: 18.1%
Computer–Other: 16.9%
Truck Rental: 16.2%
Window Treatments: 14.3%
Computer Repair 14.3%

Source: FRANdata (www.frandata.com). Percentages are based on unit growth,
year-end 2005 through year-end 2006.


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