AAMCO
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With over 50 years of experience, AAMCO is a recognized leader in the transmission business and in the past six years AAMCO has expanded its services into the $300 billion general automotive repair market. AAMCO offers the mostly highly skilled technicians and provides unparalleled service in the industry. Maintaining brand recognition in over 90% of the U.S. population and with almost 900 locations nationwide, AAMCO’s dominance in the industry is manifest. With such well-defined prominence in the transmission industry, AAMCO is poised to become the leader in breaks, tune-ups, air conditioning and other after-market services.
AAMCO represents an exciting and enticing franchise opportunity that offers financial freedom and a rewarding lifestyle. Industry growth is estimated at 3% – 5% annually, and the number of older cars present on the road is predicted to continue increasing. As such, AAMCO franchisees benefit from an advantageous market and a growing industry. With its name brand recognition and successful business model, AAMCO offers one of the best franchising opportunities in the automotive repair industry. Finally, franchisees can take advantage of hundreds of established National Fleet customers who generate millions of dollars in sales annually.
| |
Operating Units (US only) |
12/31/2008 |
12/31/2009 |
12/31/2010 |
|---|
| | Franchised |
865 |
837 |
829 |
| | % Change | -- |
-3.2% |
-1.0% |
| | Company-Owned | 0 | 0 |
7 |
| | % Change | -- |
-- |
-- |
| | Total |
865 |
837 |
836 |
| | % Change | -- |
-3.2% |
-0.1% |
| | Franchised as % of Total |
100.0% |
100.0% |
99.2% |
Investment Required
The fee for an AAMCO franchise is $39,500. A previous franchisee opening another location pays a reduced franchise fee of $17,500.
AAMCO provides the following range of investments required to open your initial franchise. The range assumes that all items are paid for in cash. To the extent that you choose to finance any of these expense items, your front-end investment could be substantially reduced.
| |
Item | Established Low Range | Established High Range |
| | Franchise Fee |
$17,500* | $39,500 |
| | GOOD Training | $10,000 | $10,000 |
| |
Expenses While Training | $2,100 | $4,000 |
| | Real Estate Deposit | $3,500 | $7,000 |
| | Leasehold Improvements | $8,500 | $12,000 |
| | Signage/Exterior Design Package | $10,000 |
$19,000 |
| | Office/Interior Package | $4,500 | $5,500 |
| | Shop Equipment, Tools, Supplies and Installation | $75,000 | $86,000 |
| | Technical Reference Materials | $6,000 | $8,000 |
| | Required Office and Shop Material, Posters, Computer System and Software |
$9,000 |
$9,000 |
| | Miscellaneous Opening Costs | $20,500 | $23,400 |
| | Initial Parts and Inventory | $2,500 | $2,500 |
| | Security Deposit | $5,000 | $5,000 |
| | Opening Advertising (optional) | $3,000 | $5,000 |
| |
Advertising Costs (3 Months) | $4,400 | $15,800 |
| |
Additional Funds (3 Months) | $30,000 | $50,000 |
| |
Total Initial Investment |
$210,500* | $299,700 |
*This fee is for opening an additional location. The Total Initial Investment Established Low Range for a first location is $232,500.
Ongoing Expenses
AAMCO franchisees pay a weekly royalty fee equal to 7.5% of total gross sales, a national creative advertising fee equal to $150 per month and local advertising fees which vary by local advertising pool and average approximately $505 per week. Other fees payable by the franchisee include monthly yellow pages advertising fees and software license and maintenance fees.
What You Get—Training and Support
AAMCO provides considerable training and support throughout the entirety of the franchise process. Prior to opening, AAMCO will offer site location recommendations and assist in layout of the center and equipment. AAMCO further orchestrates a three-week intensive training for all franchisees located at the AAMCO Operator School in Horsham, Pennsylvania. The training consists of approximately 135 hours of classroom instruction and 240 hours of on-site training and covers service system procedures, customer relations, operation, technical services, recruiting, business-to-business sales, the National Fleet Accounts program, advertising, marketing, the yellow page program and management skills. Franchisees also participate in a mandatory five-week Grand Opening Operations Development (GOOD) Training aimed to ensure that the franchisee’s transition to store ownership is seamless and successful.
Following the successful opening of an AAMCO franchised location, AAMCO continues to provide business information, literature and materials to continuously enhance the franchised center’s performance. Additionally, AAMCO supports franchisees by providing technical consulting services, national/regional/local advertising expertise, guidance regarding customer relations and general operations advice. Franchisees are also given the opportunity to participate in the AAMCO National Fleets Accounts program that offers work for fleet account customers according to previously established terms of agreement.
Territory
AAMCO does not grant exclusive territories; however, AAMCO agrees to limit the number of AAMCO Centers to a maximum of one Center per 100,000 motor vehicle registrations within a specific metropolitan statistical area.
Note: The tables and information regarding the number of operating units, investment required, on-going expenses, training and territory grants were taken from the company’s 2011 FDD. The 2011 write-ups will be incorporated into the 2012 Edition of Bond’s Top 100 Franchises publication.
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