Automotive Franchises-Who's in the Driver's Seat? - Part 2
All cars need to be serviced regularly to keep them in top running condition. Few car owners have the time or desire to perform the routine maintenance themselves. This represents a huge opportunity for franchises offering quick and convenient service, both for volume accounts and single customers. In this issue, we continue our insider's view of automotive service franchises as we speak to Sam Casternovia of Oil Butler and Roque Baecker of Jiffy Lube.

Oil Butler offers unique mobile service
Oil Butler is a mobile oil change service and windshield repair franchise that goes directly to businesses to service fleets and/or employees' cars. Sam Casternovia, Oil Butler International co-founder and president says, "We enjoy a high rate of repeat business because we help customers preserve time, one of today's most precious commodities. Our unique mobile service eliminates the trip to the local stationary quick lube."

Oil Butler is indeed unique. After 15 years in business, it remains the only mobile oil change franchise in the world. "There are no competitors," Casternovia adds, "other than some mom-and-pops working out of vans."

Oil Butler franchisees primarily target volume accounts, where multiple vehicles will be serviced in the same location. "There are two sides to this business," explains Casternovia. "The biggest part involves servicing fleets. We are approved with all the major fleets in the U.S. at their corporate levels. A fleet can be anywhere from 3 to 3,000 cars in any kind of business. It could be your local plumber who has 3 trucks all the way up to major cable companies, utilities, and rental agencies."

Casternovia calls this the "no-brainer" part of the business. "It's an easy sell. Let's say you're talking to a contractor with 10 trucks. You tell the guy you're going to change the oil at the back end of his lot so the trucks don't have to go off-site. That means there's no need to lose an employee for 2 hours while he's out trying to get an oil change. You also offer to set up the trucks to automatically get their regular maintenance so he doesn't have to think about it. Now, it's almost guaranteed that you will get this account because nobody wants to go through the hassle of going out to get an oil change if they can avoid it," proclaims Casternovia.

Casternovia continues, "The other side of our business targets employees at work. In this case, we go into companies that have anywhere from 10 to 5,000 employees and service their cars on a given day of the month. Our procedure makes it easy for employees to take advantage of our service. They order an oil change in the morning and it is done while they are at work. They love it because they don't have to waste any of their Saturday sitting in line at the nearest quick lube."

Customers and franchisees both save time
The Oil Butler system saves time and trouble for franchisees, too. "The concept was designed from the beginning with easy operation in mind," says Casternovia. "For starters, the business plan will streamline your business and keep you working in the field earning money, not wasting time doing paperwork."

Out in the field, a franchisee works from a proprietary stainless steel and aluminum trailer designed to safely perform oil changes fast. "We don't let you leave our school unless you can do an oil change in under 15 minutes on a vehicle you've never seen before. That includes doing the paperwork, topping off the fluids, and going through the 15-point check. With a little practice, you will be even faster," says Casternovia.

Good income potential for motivated operators
Because multiple oil changes are performed at a pre-arranged location and time period, "You know exactly what to do, how long it will take, and how much money you will make. The average oil change in the U.S. is $30," says Casternovia. "For each oil change, the cost of materials is $7 so you are walking away with $23. Sell a set of windshield installed wiper blades and you make another $10. Now you're up to $33 profit. Do just 10 oil changes today and you put $233 to $333 in your pocket. That's not bad for a couple hours of work. But it gets better. The most attractive part of this system is that you go back to you customers every 3,000 miles. In some cases that can be every month."

There is virtually no overhead for Oil Butler franchisees. "You can park the trailer in your driveway, keep your inventory of supplies in the garage or basement, and enjoy a flexible work week," says Casternovia. "And there is no need to invest in expensive mass media. Right now, in parts of the US, there are fleets waiting for a local Oil Butler franchise to open. That means that a new franchisee could start off with a large national account that might guarantee 100+ oil changes a month."

There are plenty of areas ready for new Oil Butler franchises and the cost of entry is low, but getting in is not automatic. Casternovia warns, "We are very selective and we go through a long process to qualify prospective franchisees because we only want those who will succeed. And unlike most franchise companies, we don't have a salesman. You have to pursue us; we won't pursue you. We look for that kind of motivation."

Contact Information: Sam Casternovia, President, Oil Butler International, (888) 428-8537, info@oilbutlerinternational.com, www.oilbutlerinternational.com

Jiffy Lube leads the fast lube industry
Changing your oil. It's a dirty job that needs to be done every 3,000 miles. There was a time when car owners did it themselves or let the friendly guys at the service station take care of it. These days, busy drivers don't have time to do it themselves and service stations employees are clerks, not mechanics. So where do you go to get your oil changed? For about 30 million Americans, the answer is Jiffy Lube, a name that's come to be synonymous with quick oil change service.

Jiffy Lube is the leader in the rapidly expanding fast lube industry with more than 2,200 service centers in North America, of which 1825 are franchises. The company is a subsidiary under Pennzoil/Quaker State, which is in turn owned by Shell.

Jiffy Lube pioneered the drive-through service bay concept for quick oil changes back in 1979. Roque Baecker, Director Network Development for Jiffy Lube International, says, "At that time, there was a big move away from the full-service station. Self-service quickly took over as the norm. In answer to that new market condition, we sprang up with an alternative for consumers who had been left to fend for themselves with our idea for a quick service option that focused on basic oil changes. We essentially invented this niche."

More than just an oil change
The core business for Jiffy Lube hasn't changed; it's still based on the basic oil change with standard menu items. It has since been dubbed the "Signature Service," Baecker says. "Generally, our retail customers come in whenever it's convenient for them. They wait in a nice comfortable lobby where they can relax while we're conducting the service. The average turnaround for the oil change is from 6 to 10 minutes."

Included in the Signature Service is visual inspection of the air filter, serpentine belts, brake fluid, coolant, wiper blades, and exterior lights. "Once that's complete," says Baecker, "we give them a service review and show them the things that we are doing to the vehicle. We point out what their manufacturer suggests and cross-reference the vehicle history that we keep in our computer system. As we walk them through that, they are able to see what services are performed or need to be performed for their car. It is all based around convenience, time, and trust from that point."

Jiffy Lube has added an assortment of ancillary services. "These are an offshoot of the core oil change business," says Baecker. "They include things like radiator flush and fill, tire rotations, air conditioning evacuation and recharge, and electrical system diagnostics. These are also in the quick service maintenance arena. We try to perform any of the ancillary service offerings in 10 to 20 minutes."

Customers won't find all services at all Jiffy Lube centers. "We have an approved line of ancillary services that our franchisees are allowed to choose from. They are required to follow the baseline of the service offering and how it is performed, but they don't have to offer everything. It is pretty much market driven. For example, in Texas, franchisees offer a state inspection service that you probably wouldn't see in Colorado," says Baeker.

A market still revving up
"The switch from the do-it-yourself to the professionally installed motor oil market is accelerating," Baecker says. "We project that about half the growth in the installed market will go to the fast lube category, with the rest going to garages, car dealers and the few remaining full-service gas stations. Over the next 10 years, the fast lube industry will need to expand to service more than 120 million vehicles a year, compared to about 80 million a year serviced in 1995."

Jiffy Lube is in every state in the U.S. and also in Canada, but Baecker says, "We don't think we're done with expansion in the U.S. by any means." The company continues to look for franchisees who will be personally involved in the business rather than just looking for an investment. "We've found the most successful franchisees are those that stay active in the operation of their business. We have a lot of family franchisees and that seems to be a dynamic that works well," says Baeker.

Contact Information: Roque Baecker, Director Network Development, Jiffy Lube International, (800)327-9532, www.jiffylube.com