Frustration is the mother of invention
Car Service City is the brainchild of serial entrepreneur, Grant Brady. Like any true entrepreneur, he spotted a gap in the market through an unfortunate incident that got him thinking, ‘There must be a better way.’
“It was over the festive season of 2004 that I took my car to a mechanic for repairs, and they closed their doors without repairing the vehicle, and just left me stranded with no vehicle for the holidays.
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“Apart from being furious, I thought there must be something in that, in having a workshop that your wife or daughter could go to where they wouldn’t get ripped off and lied to, and they’d be safe driving their vehicles afterwards. Yes, there were large, well-established service centre brands already, but I’d spotted a gap for affordable services run as a clean, professional, corporatised operation.”
Shifting gears to franchising
Within a few months, Brady had opened his first Car Service City in Centurion. It took off and within three months he’d opened his second workshop. In a two-year period the brand catapulted to 22 corporate-owned stores.
“We were growing at such a rate that we decided to shift the model to franchising. Between the fifth and eighth store we concentrated heavily on formalising the operation, creating manuals and systems, and were definitely learning on the go. We invested in IT systems, an accounting department, and we steadily grew our head office team. From 2005 we were a fully-fledged franchise model geared to enable continued rapid growth.
“We also refranchised a lot of our own stores – today we only have seven corporate owned stores out of 57 – so that we could focus our resources on fully supporting franchisees rather than running workshops,” says Brady.
“We’ve kept some stores to experience what our franchisees do daily. It helps us improve our models, systems and operations, and we know that different regions have different challenges.”
The nuts and bolts
“We’ve really worked hard to structure the business in such a way that anyone, no matter their industry background or gender, can run this business. Some of our most successful franchisees are women without car industry experience. The only thing you really need is business acumen and drive,” says Brady.
The model is also flexible enough to accommodate owner-managed operations or multiple-unit franchisees.
“Our model allows you to do both because you’ve got the support of 16 experts at head office to support you – from HR to PR, tax, attorneys, operational, finance and so on. A franchisee’s success is our success, and it really makes me happy to see other people be successful and make money,” says Brady. Ultimately, that’s what continues to drive this entrepreneur in growing the brand and taking it to the next level.
“We look at each franchisee on a case-by-case basis and evaluate their strengths and weaknesses, and help them hire to suit their abilities. For example, if your strengths lie in the front end of the business, we will assist you in finding the right staff to meet the needs of the back office. We’ve then got comprehensive and ongoing training with workshop management software, customer service, manager training sessions, mechanics training and so on, to ensure everyone is living up to the Car Service City standard.”
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The ultimate franchisee
“Culture is a very important part of the Car Service City experience. You don’t need to be car-crazy, or a mechanical wizard, but you need to be passionate and enthusiastic about the brand and what it offers consumers.
“This means franchisees need to supply a sizeable unencumbered contribution, they need to be passionate, have entrepreneurial flair, be a team player, and also be prepared to follow the operations manual and systems prescribed by head office,” says Brady.
“It’s interesting to note that of our 57 franchised stores, we only have 36 franchisees. This is because they’re driven individuals who have more than one workshop. In fact, one of our female franchisees has six workshops. Our mantra for 2015, which we will be carrying forward, is ‘Our customer is king.’ A franchisee needs to live, eat and breathe this sentiment with every single customer that walks through their doors, even if it’s 5pm on Christmas Eve.
“Another success story is two guys who are mine engineers. While studying for their MBAs, they were turned away from a number of franchises because they were too young, but we saw their passion and they sold themselves to us as much as we sold ourselves to them. We assisted them with getting National Empowerment Funding (NEF), and today they’re consistently in the top five store performers and will be expanding to multiple-units.”
“Once we’ve had initial interviews with a prospective franchisee, the process from signing to opening their doors is very thorough and handled by head office. We look at their capital to determine how much finance they’ll require, being careful to ensure they’re not over-geared, and we assist with site assessment, ensuring that the lease agreement is in line with Car Service City standards. We put franchisees through extensive training. There have been instances where we’ve even held back grand openings by a week or two because the franchisee would benefit from additional training time.”
As a franchisor, Car Service City is in the fortunate position of having its entire head office operation supported by existing franchisees’ fees. This means there isn’t an urgency to sell franchises to cover operational costs.
“We have the luxury of selecting the right franchisees at the right time, and this really benefits the group and brand,” says Brady.
Car Service City has an open door policy and is transparent about why things need to be done in a certain way, which creates a culture of mutual support. “We know every franchisee by name and what stores they own, and we make their business lives as easy as we can. If they’ve got a good idea or a challenge we’ll test it out, smooth it out, do the marketing, and then roll it out to the whole group. And because our franchisees understand that the strength of the brand is in its systems they’re open with their actions and communications, as are we.”
Driving brand growth
One of Car Service City’s most distinctive branding and marketing signatures is the intersection flyer guys dressed in orange overalls handing out promotional flyers. It’s been a real job creator to the point that the Franchise Association of South Africa, FASA, awarded us with the Job Creator Franchisor of the Year Award for 2015.
“We also came runner up for the Brand Builder of the Year award, and Franchisor of the Year Award. It’s testament to the efforts we’re putting in to marketing and branding that our franchisees and the community at large can benefit from.
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“For our ten year anniversary this September, we’re also celebrating our loyal customers who’ve helped us grow to the degree we have. We’ve taken on a marketing idea from one of our franchisees which is to have arrow spinners doing tricks with their sign boards at intersections to promote the company and our ten year celebration. This will form part of a bigger campaign of a 10% discount for ten years of affordable service, celebrating long-standing franchisees and employees, and celebrating becoming an industry leader in affordable services and repairs.”
Keeping the customer king
“At Car Service City, our customer is king, and to ensure the one-day turnaround time we’ve got bulk buying power, which helps with costs, and very strong relationships with suppliers, which means we’re always their number one priority with delivery of parts.
“We’ve also expanded the portfolio of plug-in businesses should our franchisees need it. For example, customers needn’t go elsewhere and franchisees needn’t buy a separate car wash business because there’s Car Wash City. We’re also piloting a dent repair business, and Car Tyre City. The aim is to create a one-stop shop in an area that demands it.”
What does a franchise cost?
|Training &software||R4 000 excl. Vat|
|Marketing fee||2,5% of TO p/m|
|Management fee||6% of TO p/m|
|Establishment cost||R950 000 to|
|Working capital||R150 000|
|Average time to
|Average time to ROI||Three years|