Updated: 02.12.2015

Updated: 02.12.2015
Contents
What Makes Midas an Iconic Auto Repair Franchise? ....................................................... 1
The Midas Story .......................................................................................................................... 3
What Are the Startup Costs? .................................................................................................. 5
What is Our Financial Performance? ..................................................................................... 9
Who Are Our Customers? ...................................................................................................... 10
How Advertising and Marketing Drive Business to Franchisees ....................................11
How Do I Find a Midas Location? ..........................................................................................13
Are Auto Repair Franchises Complicated?.........................................................................14
Midas Franchise Reviews.........................................................................................................15
How Auto Repair Has Changed .............................................................................................16
Midas Training and Support....................................................................................................17
Meet the Management Team ..................................................................................................19
FAQs ........................................................................................................................................... 20
Next Steps ..................................................................................................................................22
2
WHAT MAKES MIDAS AN
ICONIC AUTO REPAIR
FRANCHISE?
Learn about Midas and its more
than 1,000 auto repair franchises
throughout the United States
Midas is an iconic brand that has been part
of American car culture since the 1950s. In
2014, we were again named Entrepreneur
magazine’s top-rated auto repair franchise, and
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we have more than 1,000 shops in the United
States and more than 2,000 worldwide. Our
franchise owners provide total car care, and
together they serve thousands of customers
every day.
We’ve evolved a lot over the years. We
started in 1956 by selling the best muffler on
the market and offering a lifetime warranty.
Our excellent products, services, and
warranties helped us build a strong reputation
as an auto repair shop that stands behind
the quality of its work. That reputation has
continued as we have expanded into total
1
car care, and it’s a major reason why our
median franchises had average revenue of
$620,760 in 2013, as outlined in our 2014
Franchise Disclosure Document. That is 33%
higher than the industry average for a general
repair garage according to the Automotive
Aftermarket Industry Association. The Midas
name brings in customers, and Midas systems
help you serve them in a way that keeps them
coming back.
The market for general automotive repair
was $37 billion in 2013, according to estimates
by the AAIA. The AAIA expects that number
to grow to $39.8 billion by 2016. To put
that in perspective, that means the average
licensed driver in the United States will spend
about $200 annually on auto repairs and
maintenance.
Midas is one of America’s original
franchise systems
help you analyze your business and find ways
to bring in more revenue, resulting in more
pleasure from owning your business.
New vigor for a great brand
Midas auto repair franchises are locally
owned by independent franchisees. The Midas
brand is owned by parent company TBC
Corporation, which purchased the franchise
system in 2012. TBC saw Midas as an elite
brand that it could help grow by offering even
more support, access to additional service lines
(such as tires), and through strong national
advertising campaigns.
Midas already has seen tire sales spike since
TBC became our parent company, and an
advertising campaign, launched in 2013, has
driven an increase in overall sales throughout
the system. The national ad campaign, paired
with local marketing, is introducing a new
generation of customers to Midas.
We started franchising in the 1950s, and
have been evolving ever since. In 1956, Midas
changed the American landscape by creating
free-standing auto repair garages. We
continue to lead both the automotive and the
franchise industries. Within the automotive
industry, we helped develop standards
of service that brought transparency to
customers about which repairs were urgently
needed, which ones were recommended, and
which ones could wait for the future. Those
standards — The Midas Way of treating
customers — led to a better customer
experience and a better industry. We also
pioneered the idea of offering exceptional
support to franchisees. When you become
part of Midas, you get more than a great
brand. You get a great team that consists
of consultants and sales coaches who can
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2
THE MIDAS STORY
How the Midas auto repair
franchise became an elite
automotive brand
In 1931, Nate Sherman, a traveling auto
parts salesman from Omaha, met a punch
press operator named Joe Marx during a trip
to Hartford, WS. Nate was a visionary who
realized that all of the new cars that were filling
America’s roads would need replacement parts,
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and he asked Joe if he could manufacture
mufflers. They soon set up a factory to do just
that.
Nate realized that the mufflers they had
developed were superior to any other. He and
Joe figured out a way to make them even
better by working with the Armour Institute
of Technology to develop a coating to make
the mufflers rust-resistant and added other
design refinements to make their mufflers more
durable.
3
Once perfected, Nate turned his eyes toward
the retail market for automotive parts. His
idea was bold: He wanted to sell his mufflers
through franchised repair shops. It was one of
the first attempts to bring franchising to the
automotive aftermarket.
Hugh Landrum, who had been buying
mufflers from Nate for years, became
Franchisee No. 1 in 1956. Within a year, 100
repair shops would join the “Muffler Installation
Dealers Associated Service” and MIDAS was
born.
Building the brand
National radio advertisements quickly
made Midas a household name. A tweak of
design also made Midas mufflers instantly
recognizable: Brass flakes added to the rust
protectant gave Midas mufflers a golden hue.
that offer Midas technicians and consumers
clear explanations of the difference between
a required service and a suggested service.
Technicians also began receiving extensive
training on how to communicate repair
recommendations to customers. The standards
have since been copied throughout the auto
industry and have helped empower customers
to make the best decisions about what to fix
and when.
By the end of the 1990s, Midas had evolved
again, becoming a destination for total
car care. Today, Midas still offers total car
care, handling everything from mufflers and
brakes to air conditioning and radiator repair,
oil changes, transmission fluid exchanges,
suspension work, tire repairs and sales, and so
much more.
As car sales continued to rapidly increase
throughout the 1960s, Midas kept pace, adding
franchises to serve the needs of car and truck
owners. Like KFC®*, Subway®*, McDonald’s®*
and Burger King®*, all of which also started in
the 1950s, Midas became an iconic American
brand.
When the Clean Air Act of 1975 forced
changes in the way that mufflers were made,
resulting in longer-lasting equipment from
automakers, Midas diversified its services to
include brakes. Brake service soon became
big business for the Company. In 1988, Midas
added computerized suspension and alignment
service to its offerings.
In the early 1990s, Midas took a leap forward
for the entire auto industry by developing
Standards of Service — a set of guidelines
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* KFC is a registered trademark of KFC Corporation. Subway is a
registered trademark of Doctor’s Associates Inc. McDonald’s is a
registered trademark of McDonald’s Corporation. Burger King is a
registered trademark of Burger King Corporation.
4
WHAT ARE THE STARTUP
COSTS?
Midas franchise startup costs —
an overview
How much does it cost to start a Midas
automotive repair franchise? It depends on the
route you choose to open your shop. Startup
costs to open a newly constructed 8-bay Midas
franchise range from $203,130 to $424,520.
Startup costs can be lower for franchisees
who choose to convert an existing automotive
shop to the Midas brand. Startup costs for a
conversion range from $74,130 to $419,520.
Here are detailed looks at the startup costs
for a new 8-bay Midas and for conversion of an
existing auto repair facility, as outlined in the
2014 Midas Franchise Disclosure Document. To
learn more, download our free franchise report
to start a conversation.
Your Estimated Initial Investment for a New (8-Bay) Midas Shop
Type of Expenditure
Estimated Amount or
Low-High Range
Method of Payment
When Due
Initial Franchise Fee
$0 - $30,000
Generally, lump sum
$5,000 with Application Us
and balance paid at the
time of execution of
Franchise Agreement
Site Selection Fee
$1,000 - $2,500
Lump sum
At the time of execution MRC
of Franchise Agreement
Marketing Support
Program
$5,000
6 equal monthly
installments
First 6 months of term
of Franchise Agreement
Us
Travel & Living
Expenses while Training
$1,000 - $7,800
As incurred
Before opening, as
incurred
Third Parties
Security Deposit,
Licenses & Permits
$4,000 - $10,500
Lump sum
Before occupancy and/
or at signing of lease or
sublease
Third Parties
Rent and Real Estate
Taxes (3 months)
$12,000 - $31,500
As arranged
First month’s rent is due MRC, MPI or Lessor
before occupancy and/
or at signing of lease or
sublease, then monthly
Warranty Registration
Fee (3 months)
$150 - $2,000
As incurred
The fee is added
to the Franchised
Unit’s Trade Account
Statement upon
warranty registration,
which payment is due,
generally, by the 17th
day of the month.
Us
Equipment & Tools
$50,000 - 128,000
As arranged
Before opening
Third Parties or Us
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©2014 Midas International Corporation
To Whom Payment Is
To Be Made
5
Shipping and
Installation Costs Equipment
$11,000 - $15,000
As incurred
Before opening
Third Parties
Computer, Hardware &
Telephone System
$6,000
As arranged
Before opening
Third Parties
Office & Waiting Room
Furniture & Point of
Purchase Materials
$16,000
As arranged
Before opening
Third Parties
Signage
$10,000 - $20,000
As incurred
Before opening
Third Parties
Shipping and
Installation Costs Signage
$6,000 - $9,000
As incurred
Before opening
Third Parties
Initial Inventory &
Supplies
$25,000 - $50,000
As arranged
Before opening
Third Parties or Us
Grand Opening
Activities
$10,000
One Lump Sum
Upon execution of the
franchise agreement
Third Parties or Us
R.O. Writer Software
Installation
$0 - $1,800
As incurred
Before opening
PAS
R.O. Writer Software
Maintenance Fee (3
months)
$0 - $330
As incurred
Monthly, via credit card
or ACH
PAS
R.O. Writer Express
Software Maintenance
Fee (3 months)
$0 - $90
As incurred
Monthly, via credit card
or ACH
PAS
Technical Information
Systems (3 months)
$480 - $1,000
As incurred
Monthly, via credit card
or ACH
Third Parties
Insurance (3 months)
$1,500 - $4,500
As arranged
Before opening
Third Parties
Legal & Accounting
$1,000 - $3,500
As arranged
As incurred
Third Parties
Additional Funds (3
months)
$40,000 - $65,000
As needed
As incurred
Third Parties
Miscellaneous
$3,000 - $5,000
As needed
As incurred
Third Parties
TOTAL ESTIMATED
INITIAL INVESTMENT
$203,130 - $424,520
General Note: It is impossible to provide the
exact investment required of each Midas
franchisee due to the many variables that
influence the total project cost, such as location,
amount of space leased, cost of land and
building, and other costs peculiar to a specific
site. The initial investment, as well as availability
and terms of financing, will vary considerably
depending on the methods and amount of
financing, your creditworthiness, collateral you
might have, and lending policies of financial
MidasFranchise.com
©2014 Midas International Corporation
institutions. The equipment and other items are
shown in full, although they might be financed
or leased. You are encouraged to discuss
the operations of the Midas Shop with Midas
franchisees (See Exhibits A-1 and A-2 in our FDD
for lists of current and former Midas franchisees).
You should also review these figures carefully
with a business advisor before making any
decision to purchase the Midas Shop franchise.
None of the fees listed in this item are refundable,
unless otherwise stated.
6
Your Estimated Initial Investment to convert an Operating or Previously
Operated Automotive Repair Facility to a Midas Shop
Type of Expenditure
Estimated Amount or
Low-High Range
Method of Payment
When Due
Initial Franchise Fee
$0 - $30,000
Generally, lump sum
$5,000 with Application Us
and balance paid at the
time of execution of the
Franchise Agreement
Site Selection Fee
$0 - $2,500
Lump sum
At the time of execution MRC
of Franchise Agreement
Marketing Support
Program
$0 - $5,000
6 equal monthly
installments
First 6 months of term
Us
of Franchise Agreement
Travel & Living
Expenses while Training
$1,000 - $7,800
As incurred
Before opening, as
incurred
Airlines, Hotels &
Restaurants
Security Deposit,
Licenses & Permits
$4,000 - $10,500
Lump sum
Before occupancy and/
or at signing of lease or
sublease
Third Party Lessor,
Utilities and/or
Government Agencies
Rent and Real Estate
Taxes (3 months)
$12,000 - $31,500
As arranged
First month’s rent is due MRC, MPI or Lessor
before occupancy and/
or at signing of lease or
sublease, then monthly
Warranty Registration
Fee (3 months)
$150 - $2,000
As incurred
The fee is added
to the Franchised
Unit’s Trade Account
Statement upon
warranty registration,
which payment is due,
generally, by the 17th
day of the month.
Us
Equipment & Tools
$0 - $128,000
As arranged
Before opening
Third Parties or Us and
Third Parties
Shipping and
Installation Costs Equipment
$0- $15,000
As incurred
Before opening
Third Parties or Us and
Third Parties
Computer, Hardware &
Telephone System
$2,000-$6,000
As arranged
Before opening
Third Parties
Office & Waiting Room
Furniture & Point of
Purchase Materials
$2,000-$16,000
As arranged
Before opening
Third Parties and/or Us
Signage
$0- $20,000
As incurred
Before opening
Third Parties and/or Us
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©2014 Midas International Corporation
To Whom Payment Is
To Be Made
7
Shipping and
Installation Costs Signage
$0- $9,000
As incurred
Before opening
Third Parties and/or Us
Initial Inventory &
Supplies
$0 - $50,000
As arranged
Before opening
Third Parties,
Designated Suppliers
and/or Us
Grand Opening
Activities
$10,000
As incurred
Before opening
Third Parties
R.O. Writer Software
Installation
$0 - $1,800
As incurred
Before opening
PAS or its Designated
Suppliers
R.O. Writer Software
Maintenance Fee (3
months)
$0 - $330
As incurred
Monthly, via credit card
or ACH
PAS
R.O. Writer Express
Software Maintenance
Fee (3 months)
$0 - $90
As incurred
Monthly, via credit card
or ACH
PAS
Technical Information
Systems (3 months)
$480 - $1,000
As incurred
Monthly, via credit card
or ACH
Third Parties, PAS and/
or Us
Insurance (3 months)
$1,500 - $4,500
As arranged
Before opening
Insurance Companies,
Agent or Broker
Legal & Accounting
$1,000 - $3,500
As arranged
As incurred
Third Parties
Additional Funds (3
months)
$40,000 - $65,000
As needed
As incurred
Third Parties,
Employees
Miscellaneous
$3,000 - $5,000
As needed
As incurred
Third Parties
TOTAL ESTIMATED
INITIAL INVESTMENT
$77,130 - $424,520
General Note: It is impossible to provide
the exact investment required of each Midas
franchisee due to the many variables that
influence the total project cost, such as
location, amount of space leased, cost of land
and building, and other costs peculiar to a
specific site. The initial investment, as well as
availability and terms of financing, will vary
considerably depending on the methods and
amount of financing, your creditworthiness,
collateral you might have, and lending policies
of financial institutions. The equipment
MidasFranchise.com
©2014 Midas International Corporation
and other items are shown in full, although
they might be financed or leased. You are
encouraged to discuss the operations of
the Midas Shop with Midas franchisees (See
Exhibits A-1 and A-2 in our FDD for lists of
current and former Midas franchisees). You
should also review these figures carefully with
a business advisor before making any decision
to purchase the Midas Shop franchise. None
of the fees listed in this item are refundable,
unless otherwise stated.
8
WHAT IS OUR FINANCIAL
PERFORMANCE?
Midas franchise owners
significantly outperform the
industry
Midas franchise owners, on average,
significantly outpace the performance of
other general auto repair and maintenance
businesses. In its 2014 Digital Factbook, the
Automobile Aftermarket Industry Association
estimates that general repair garages produced
average revenues of $466,024 in 2012. As you’ll
see below, the average Midas store does much
better. Our mid-tier franchisees had average
revenues of $620,760 in 2013 — 33% higher
than the industry. And the top third of our
franchisees blew the industry averages away,
with revenues of $921,611 in 2013.
Here’s more detail from Item 19 of our
Franchise Disclosure Document:
Top Third
Middle Third
Bottom Third
Number of Shops in Group
38
38
38
Average Sales Per Shop
$921,611
$620,760
$438,255
Cost of Goods Sold
23.40%
23.30%
24.40%
Technician Wages
17.60%
16.80%
17.80%
Franchise Royalties
4.80%
4.80%
4.80%
Advertising Royalties
4.80%
4.80%
4.80%
Other Variable Expenses
2.90%
3.40%
3.80%
Other Fixed Expenses
$35,840
$30,350
$24,143
Expenses as % of Sales
It’s important to note: The table immediately
above excludes many other types of
expenses often incurred by franchisees that
are significant, including manager salaries,
payroll, taxes, fringe benefits, rent, real estate
taxes, insurance, business licenses, equipment
leasing, professional fees, travel, entertainment,
administrative salaries, depreciation,
amortization, and interest expenses. These
expenses have been excluded from the
table above because they might be heavily
influenced by discretionary factors and might
vary significantly from what you might pay
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©2014 Midas International Corporation
for them under normal market and business
conditions.
We encourage you to consult with your
financial advisors in reviewing the information
in Item 19, in particular, estimating the
categories and amount of additional expenses
that might be incurred in establishing and
operating a Midas shop.
Furthermore, you should be aware that any
particular Midas shop’s financial performance
might be affected by numerous factors that
vary due to the individual characteristics
9
of the Midas shop. These factors include:
competition from car dealers and other auto
service centers, appreciation and acceptance
of the services and products that the Midas
Shop offers in its community, a franchisee’s
experience, business development and
managerial skills, advertising programs,
personnel and cost controls, geographic and
socioeconomic conditions in the Midas area,
business cycles, and performance of the
economy locally, nationally, and worldwide.
WHO ARE OUR
CUSTOMERS?
Here’s why customers choose the
Midas auto repair franchise
Midas is one of the best known brands in
the world and is known for complete car care,
which makes us a magnet for drivers who are
looking for a great mechanic.
Once a vehicle’s warranty ends, most drivers
stop going to the dealership for
maintenance. They want options that
are more convenient and have better
prices. At the same time, they expect a
high level of expertise.
third generation in his family to own Midas
shops: His grandfather started the first Midas in
Akron, OH, in 1956, and the family soon started
expanding into other cities. They now have
more than 110 Midas shops throughout the
United States.
A big part of our success has been making
Midas a nicer place for customers,” Ian says.
“We are experts and professionals, and it’s
important for that to be reflected when a
customer walks inside. We like it to be like a
doctor’s office: clean and uncluttered waiting
rooms with flat-screen TVs, free coffee and
WiFi, and comfortable seating.”
Another feature of Midas shops: large
windows that look into the car maintenance
bay. Midas pioneered the use of windows
between the lobby and the shop, which allows
customers to see everything that is happening
to their cars.
Whether a customer brings a car in for an
oil change, for brakes, or for something more
A typical Midas customer comes
to us when their car is three years
old and freshly out of warranty. Their
vehicle is still like new, and they
want to keep it that way. They want
expert mechanics, and they also want
excellent customer service.
Ian Katz believes in setting the
right expectations the moment a
customer walks in the door. Ian is the
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©2014 Midas International Corporation
10
serious, Midas technicians always perform
a courtesy check on the vehicle. The free
inspection helps customers stay on top of fluid
levels and condition, the state of engine belts,
air filters, hoses, lights, wipers, and other items
that are important for safe driving and vehicle
durability.
By offering consistent courtesy checks,
Midas technicians build trust with the
customer. If all systems are in great shape, we
let customers know. And if something looks like
it will need service soon, we inform customers
so they can budget accordingly the next time
they come into the shop. When we catch
something that should be fixed immediately,
that trust pays big dividends. Nobody wants
to learn that they need a $300 repair — but a
$300 repair now can save a customer from a
$4,000 repair later. By building relationships
with our customers through courtesy checks,
we earn their trust so that they are willing to
pay for repairs that are needed. By taking the
time to inform our customers and earn their
trust, we save them money in the long run.
Former IT executive Sunil Trehan, who owns
three Midas shops in the Chicago area, went
undercover at different auto repair franchises
before deciding to invest in Midas.
“I noticed the customer experience was
better at Midas, and I really wanted to go
with the best,” he says. “Midas had more
attention to detail and better processes. They
explain what’s wrong and build trust with the
customer.”
HOW ADVERTISING
AND MARKETING
DRIVE BUSINESS TO
FRANCHISEES
Courtesy checks improve customer
satisfaction scores, increase what the average
customer spends, help the average customer
avoid expensive repairs later on, and educate
customers about the wide variety of repair and
maintenance services Midas shops offer.
We are Total Car Care experts. We can
handle everything a dealer can handle, for
nearly every vehicle on the road.
We’ve earned our customers’ trust because
Midas shops are convenient, value-priced
shops with teams of automotive experts. Our
franchise system has been around for nearly
six decades and is backed by global company
TBC.
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©2014 Midas International Corporation
National advertising, warranties
help keep the biggest auto repair
brand strong
The Midas brand has been attracting
customers for nearly 60 years, thanks to a
11
combination of expertise, great service, lifetime
warranties, and savvy marketing. Midas has
helped to build its brand by advertising on
popular radio shows, on television, and more
recently through social media. Advertising,
coupled with our growth to more than 1,000
locations nationwide, has made us a household
name.
At the same time, people who never visited
a Midas or who haven’t visited a Midas in a
few years might not realize how much we’ve
grown. We repair a lot more than mufflers
and brakes these days, and we have launched
aggressive national advertising campaigns
to make sure new customers know about
everything we offer.
Midas is a legacy brand — one that everyone
knows, and one that millions of Americans have
used. We are part of the American car culture.
People know our slogan, “Trust the Midas
Touch,” and come to us for total car care —
everything from engine and transmission repair
to oil changes, suspension, tires, brakes, and
exhaust systems.
Midas is here to stay with room to grow.
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©2014 Midas International Corporation
We have launched national advertising
campaigns to put the Midas name in the
spotlight and bring in new generations of
customers. Together, Midas franchisees spend
millions each year to put the Midas name in
front of customers, and you inherit the results
of that advertising push the day you become
12
a franchisee. At the same time, we have
developed high quality branding that features
strong messages and a consistent look and feel
that carries across our TV advertising, mailers
and fliers, in-store displays, website, and social
media. By tying everything together into an
integrated strategy, we have been able to
amplify the power of our marketing.
Local marketing
In addition to our national advertising and
marketing efforts, we provide all franchisees
with marketing templates for local efforts.
Franchisees in many markets also have
formed advertising co-ops to develop local
ad strategies and drive traffic. Through the
Midas system, those
co-ops keep the
branding consistent
and powerful.
Midas also uses
in-store marketing
to let customers
know about
additional services
we have available.
Our point-of-sale
system tracks
your customers’
information and
the needs of their
vehicles, which
allows you to send targeted marketing mailers
and coupons to prospects and customers
who might need automotive work soon. Is a
customer due for a tune-up in three months?
The system makes it easy for you to send a
coupon or a reminder ahead of time, so that
they don’t have any reason to shop elsewhere
for service.
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©2014 Midas International Corporation
HOW DO I FIND A MIDAS
LOCATION?
What makes a good Midas
location, and how do I find one?
Midas looks for streets with high traffic
counts, with 50,000 or more residents within
three miles, and with speed limits no higher
than 45 miles per hour. We look for areas that
have several other major food, automotive, or
retail brands, and we like to put new locations
near car dealerships, since many customers
transition their freshly out-of-warranty cars
from dealer maintenance to Midas.
There are three
routes you can
follow to open your
Midas auto repair
franchise. You
can build a new
location, buy an
independent auto
repair facility and
convert it to Midas,
or buy an existing
Midas.
The first option
— building new —
allows you to start
with a building
that is customized to provide Midas service.
The main challenge to building new is the
availability of real estate that is zoned for
automotive use. Most city zoning laws restrict
where automotive shops can operate. The
zoning rules narrow the options, but we work
with prospective franchisees to search for a
good location. The zoning restrictions are also
13
one of the reasons that it is valuable to be
part of a national brand — many cities group
automotive businesses in the same areas, and
the Midas brand can help you stand out in the
crowd. Typically you will lease the commercial
land from the property owner and then build
the facility. You can also buy the land outright,
creating an additional asset.
ARE AUTO REPAIR
FRANCHISES
COMPLICATED?
You don’t need to be a mechanic
to run a successful Midas auto
repair franchise
The second option, which has become
more popular — is to buy an existing auto
repair business and convert it to Midas. There
are more than 400,000 automotive repair
and maintenance businesses operating in
the United States, and thousands are for sale
at any given time. We can help you identify
businesses that are for sale in good locations
that would be suitable for conversion. A quick
guideline: The business should have at least six
bays, be at least 4,000 square feet and have at
least 15 parking spaces.
The third option is to buy an existing Midas
location. We have more than 1,000 locations in
North America and have been franchising since
1956. Handfuls are for sale at any given time,
and we can let you know if one is available in
your market.
The site selection process and build out can
take as little as three months for a conversion
to 18 months for new construction.
Sometimes franchise candidates think:
“Eighteen months? I don’t want to wait that
long!” Instead, think big-picture. Let’s say
that, worst-case scenario, it takes you 12 to 18
months to open. Midas has several franchisee
families who are in their third generation, with
stores that opened in the 1950s. If a business is
capable of providing for your family for three
generations, isn’t it worth the wait?
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Who makes a successful Midas auto repair
franchise owner? First and foremost, you need
to be a “driver.” We need business owners
who can drive their businesses forward and
maximize the opportunities at hand. Secondly,
you need to run a high-trust, customer-friendly
business. Think about it. Customers don’t
usually know what is wrong with their cars, so
they don’t know which repairs are necessary.
They are taking a leap of faith. Trust is
paramount, and if you reward their trust, they
will reward you with loyalty and dollars. Third,
you can come from any background — you
don’t need to be a mechanic or car person.
Many of our most successful franchisees
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don’t have an automotive background — but
they are trustworthy and skilled businessmen
and businesswomen. Successful franchisees
include IT executives, bartenders, customer
service managers from other retail concepts,
hoteliers, medical school students, insurers, and
yes, car guys, too.
For instance, Judd Shader was fresh out of
college when he bought his first Midas shops
in Denver. He was looking for a stable business
with huge, sustainable demand, and the
automotive sector appealed to him because
he knew that excellent customer service could
help his businesses stand out.
“What attracted me to Midas was the
opportunity to bring excellent customer
service to an industry where good customer
service isn’t always given,” he says.
Midas has great systems and a strong brand,
and he knew that if he was willing to work
hard, train his employees to follow The Midas
Way, and keep a close eye on cash flow and
profitability, he could build an extremely strong
business.
Judd, who is not a mechanic, soon partnered
with Jeff Genuario, a third-generation Midas
owner in Denver, to expand throughout the
United States. Jeff first ventured into sales
and marketing for high-tech companies and
pharmaceuticals, but he eventually returned to
the family business.
“We focus on really simple things to make
sure our customers are served right,” Jeff
says. “We are very training-focused and
goal-oriented, and that has helped us boost
performance. Our motto is: ‘Every customer,
every time.’ If you follow Midas’ systems and
do the right things for your customers, results
will follow.”
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The most successful franchisees stay
focused on satisfying existing customers while
growing their customer base through smart
local marketing that makes the most of the
strong Midas brand.
MIDAS FRANCHISE
REVIEWS
What do Midas franchisees say
about the brand?
Jeff Genuario, COO of Denver-based
The Leeds West Groups, which owns Midas
locations in several markets nationwide
“They have Franchise Business Managers
and Shop Operations Managers that help us
grow our business. We have the ability to work
with store managers to help make sure the
customer experience meets what we expect
and what Midas expects. When we go into new
markets, they send in regional resources to help
us get them open and up to speed. They are an
invaluable part of how we go to market. Now,
they aren’t going to run the whole thing for the
franchisee, but they are a great resource.”
Ian Katz, third-generation Midas owner. His
grandfather Cal was one of the original Midas
franchisees in 1956
“If aftermarket automotive repair is your
interest or passion, Midas is as good or better
than anything out there. You have 60 years of
experience and 60 years of brand recognition.
There are a lot of locations, and customers
know what Midas is and what Midas does. We
also work well together. Everyone understands
we are in it together.”
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Russ Gibson of the ASE Group, which owns
36 Midas shops, describing the relationship
with the franchisor, Midas International Corp.
“There have been numerous times when (VP
of Marketing) Bob Crostarosa has picked up
the phone and said: ‘I’m thinking about this.
What are your thoughts?’ I’ll get a call from
(COO) Mike Gould. I just got an email from
someone who handles our template forms for
estimates. That kind of communication goes
back to franchisee-franchisor relationship. It
provides real value when you have a franchise
partner who is working with you, and that kind
of communication has increased tenfold with
TBC.”
Dan Turner, 53, who bought his first Midas
store in Denver, CO, in 2012
“I’ve been in automotive all my life. I spent 26
years helping build (a competing automotive
brand) then helped to manage 13 Midas stores
when they were corporate-owned. Buying
one has been the best move I’ve ever made. I
should have bought stores years ago.”
HOW AUTO REPAIR HAS
CHANGED
Americans are keeping their cars
longer and racking up miles.
Here’s what that means for Midas.
One of the reasons Midas started as a muffler
shop is that mufflers, and exhaust systems in
general, used to fail on a regular basis. Moisture
and salt would combine to rust metal mufflers.
Misfiring engine cylinders would allow gasoline
to seep into the exhaust system, and the
“backfire” would cause the muffler to explode
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at the welding seams – causing tears and holes.
Midas initially built its reputation by
providing drivers a quick, convenient place
to have their mufflers replaced, and then
selling them a rust-resistant muffler that was
engineered to be stronger and more resistant
to a blowout. Our reputation for excellence
was further enhanced by a nationwide
warranty that covered the muffler “for as long
as you own your car.” No other company was
providing that.
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Thanks to improvements in auto
manufacturing, “as long as you own your car” is
now a lot longer than it used to be.
do-it-yourselfers are having a hard time making
their own repairs. They need sophisticated,
professional mechanics they can trust.
A few decades ago, driving a car with more
than 100,000 miles on the odometer was a
gamble. You knew something was going to go
wrong — you just didn’t know when.
Maintenance moves to the
forefront
Now, a car with 100,000 miles is normal.
Drivers depend on cars lasting much longer.
Cars have become more expensive, and
Americans know they can stretch their dollars
further by properly maintaining what they
have. As drivers elect to make repairs and keep
existing cars on the road, they need trusted
mechanics. The Midas brand means you have
the opportunity to impress customers with
highly trained mechanics, quality products, and
customer service that can’t be beat, turning
them into loyal, regular visitors.
Midas still repairs exhaust systems, and we
can also fix engines, transmissions, shocks and
struts, and everything else in a car. But, unlike
in the past when we would fix a problem, today
our focus is on helping customers maintain
their vehicles so they last as long as possible.
People take better care of their cars because
they understand that with the right upkeep,
their cars can stay in great shape for a very
long time.
Customers come to Midas because we help
them stay on top of routine maintenance like
oil changes, fluid exchanges, and tire rotation
and balancing. While they’re here, we also
perform a courtesy check to ensure every
vehicle is safe and in good condition.
With that kind of service, Midas helps
customers keep their cars in great running
condition.
MIDAS TRAINING AND
SUPPORT
American cars are now 11.3 years old
on average, according to the Automobile
Aftermarket Industry Association, and nearly
250 million are on the road. Those two facts
are a big reason why auto repair is expected
to become a nearly $40-billion-a-year industry
by 2016. Newer cars also increasingly rely on
electronics to control key vehicle systems, and
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Midas training and operational
support is a model for the entire
franchise industry
Sunil Trehan says the exceptional training
and support Midas offers are some of the
biggest reasons he chose the brand when he
decided to start a business.
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The former IT executive calls the initial
classroom training “a very good experience.”
Once you sign a franchise agreement, you will
be asked to spend at least five days observing
operations at an existing Midas shop. We will
then work with you to develop a business
plan, as well as a competitive analysis of
your market. Next, you will be invited to TBC
Corporation headquarters in Palm Beach
Gardens, Florida, for two weeks of classroom
training. The training provides an in-depth
look at business
operations,
marketing, the
Midas pointof-sale system,
inventory
management,
shop operations,
and customer
service.
Once you
open your Midas,
much more
support kicks in.
We have
developed a
field support team of more than 40 people
who work with Midas owners to find ways to
improve their operations — boosting customer
satisfaction and profits. Each franchisee
will work with and have regular access to
a Franchise Business Manager and a Shop
Operations Manager.
The Franchise Business Managers work
with Midas owners to develop business plans,
set goals, track progress toward goals, grow
revenue and increase profitability. They are like
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personal trainers for your business, working to
help you keep your business strong.
The Shop Operations Managers provide
training to help your sales team and mechanics
provide thorough, friendly customer
service. They help you boost your customer
satisfaction so that you get more repeat
business and great word-of-mouth referrals.
Simply put, you receive training and
support to help you excel as a Midas owner,
positioning you for
greater expansion. In
addition, your team
receives training and
support to increase
their skills and
earning potential,
which boosts labor
retention and makes
your business more
scalable.
We offer an
enormous library of
business information
and mechanic-level
training through
TBC University, which you have access to
through our intranet. More than 300 courses
are available to help sharpen the skills of the
mechanics in your shop. Midas technicians
are the best, and TBC University helps them
maintain their edge and keep current with
changes in the automotive industry. Want to
know how to solve a problem with an electric
car? TBC University has instructions to help.
Whether it’s business training, customer
service training, or mechanical know-how, we
help you stay ahead of the curve.
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MEET THE MANAGEMENT
TEAM
Midas leadership team has a
wealth of experience supporting
franchisees and helping them
succeed
Brant Wilson
Director and Senior Vice President,
Franchise Group
Brant Wilson was appointed to the position
of Director of the Franchisor on Jan. 1, 2014. He
was appointed to the position of Senior Vice
President, Franchise Group of TBC effective
Nov. 1, 2013. From 2007 to Oct. 31, 2013, he
was employed by H&R Block and held various
positions within that organization including
Vice President of Franchise Development and
Territory Vice President for the West.
Mike Gould
Executive Vice President and Chief
Operating Officer
Mike has been a part of the Midas family for
34 years. He started as a technician at a Midas
shop in Royal Oak, Michigan, before being
promoted to store manager. Then Mike was
asked to oversee a group of company-owned
locations. After helping those stores succeed,
he was named Vice President of Franchise
Operations for the United States and Canada
and worked with franchisees to help them
boost performance. He was promoted to Chief
Operating Officer after Midas was purchased
by TBC, which has sold nearly all companyowned stores to franchisees. Mike’s extensive
experience working in Midas stores and with
franchisees means that he understands the
business from the ground level.
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Gerry Schwall
Vice President, Franchise Operations, East
Gerry oversees the franchise support
teams in the eastern half of the U.S., leading
the franchise business managers and shop
operations managers who advise franchisees
about ways they can increase revenue and
profitability, and who provide training and
assistance to ensure Midas customers enjoy
consistent experiences everywhere they go.
Phil Hultquist
Vice President, Franchise Operations, West
Phil oversees operation support in the
western U.S. He has more than 24 years of
experience supporting franchisees and store
managers as they worked to win customers
and earn high customer satisfaction.
Bill Ketchem
Vice President, Franchise Development
Bill Ketchem served as a financial and
operations consultant for Big O Tires, another
brand in the TBC network, before being
appointed to lead Midas’ franchising team in
2012.
Darrell Fisher
Vice President, Business Management
As Vice President of Business Management,
Darrell works with the Midas franchisee
organization to share ideas and best practices
throughout the franchise system.
Glenn Root
Director and Vice President, Canadian
Operations
Glenn Root has held the position of Vice
President, Canadian Operations since Sept.
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2004. He was elected as Director in April,
2008. From March 2001 to Sept. 2004 he
served as Vice President and General Manager,
Consumer Division of Beverly Tire.
FAQs
Q. How do I qualify to own a
Midas shop?
A. Solid business or retail experience, proven
management skills and a strong financial
position would be your best preparation. You
will need at least $75,000 cash available for
investment into the business and a net worth
of at least $250,000 to begin discussions
with Midas. Development of new or multiple
locations would require greater cash and net
worth amounts to qualify. If you are close, let’s
have a conversation. Many people overlook
assets that would help them qualify.
Q. What special qualities or skills
are required?
A. You must have some proven management
experience or aptitude, strong business ethics
(as this is a high-trust business) and abilities, a
customer service mentality and willingness to
be involved in the management of the shop.
We look for owners who are success-driven
and growth-minded.
Q. What are the franchise fees,
royalty fees and franchise terms?
A. Franchise fee* — $10,000 to $30,000
Royalty fee* — Up to 10%, with at least half
of the royalties devoted to advertising.
Franchise term —The Franchise term is
for 20 years and is renewable at the end of
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©2014 Midas International Corporation
the term subject to approval, conditions and
payment of renewal fee.
*See the current Franchise Disclosure
Document for a description of the range of
initial franchise fees.
Q. Will Midas help with financing?
A. Midas works with qualified lenders who
have either financed other Midas operations
or expressed an interest in working with
Midas franchise candidates. These lenders
can usually meet a variety of business funding
needs to help you pursue the Midas franchise
opportunity of your choice. Midas might offer
special financial incentives for opening a new
shop. In addition Midas can help franchisees
use other financing vehicles such as selfdirected IRAs and home equity lines to finance
their businesses.
Many Midas franchisees finance their
business through SBA loans. Midas is part
of the U.S. Small Business Administration’s
Franchise Registry. The SBA created the
Franchise Registry in 1998 to streamline the
process banks use to determine franchisees’
eligibility for SBA loans. When the agency
approves a franchise system for inclusion, it
agrees to guarantee 75 to 85 percent of any
loan to franchise candidates, reducing the
risk to banks and increasing the likelihood of
approval.
Q. What are the benefits of
converting my business to a
Midas?
A. The high awareness level of our brand
name increases your visibility and chances for
success. By putting our logo on your building,
you become a part of something bigger —
Midas. You will benefit from the tools we
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have perfected over the years to grow our
franchise network. You reap reap the rewards
of our multimedia advertising campaigns that
generate brand awareness. You will get to
take advantage of the skills-enhancing training
programs that we have designed around
today’s retail environment. We know that as
an established business owner, you already
are knowledgeable about your market and
your customers. We expect that you might
be ready to grow your business even more
by expanding your customer base through an
affiliation with Midas. Also, under our brand
name, you might find it easier to expand your
business into new markets through multiple
unit ownership.
Q. How does Midas evaluate a
new store location?
A. Midas analyzes information from various
sources for traffic count, registered vehicles,
replacement rates, population, growth trends,
competitive factors, zoning, retail shopping
patterns, and other appropriate factors.
Q. What is the standard shop
size?
A. A Midas shop can be found in almost
every type of market throughout the United
States and Canada. The range of shop sizes
varies throughout our network, from 4-bay
shops to 12-bay shops. These shops also vary
in building design, depending on when they
were built. With today’s business model, our
recommendation for new development is 6
bays or larger. However, we will evaluate each
market opportunity on a case-by-case basis
to determine the right fit for expected service
demands. If you are a conversion candidate
and are concerned about whether your facility
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will accommodate the Midas service offering,
we will be glad to evaluate it.
Q. What automotive services
does Midas provide?
A. Midas has evolved from a specialist in
under-the-car services to the provider of an
extensive and growing list of maintenance and
repair services: brakes, steering, suspension,
exhaust, catalytic converters, batteries, tires
and more. Midas serves individual vehicle
owners as well as nationwide vehicle fleets.
Q. What about inventory?
A. The Midas franchisee is required to
maintain an inventory that is adequate both
in terms of range and quantity of items to
fulfill public demand. Midas maintains strategic
alliances for parts distribution to support
the franchisee network. Additionally, these
suppliers can provide “Just in Time” delivery
to your store. By systematically building
relationships on the supply side and within the
retail network, Midas continues to bring an
expanding line of products your way.
Q. What advertising support can I
expect?
A. As stated in the franchise agreement,
Midas currently commits to spend not less
than one-half of all royalties actually collected
on certain advertising expenditures each year.
These expenditures promote the Midas name,
image and services in a national advertising
campaign that focuses on television, radio,
billboards, local newspaper announcements
and special events. On the local level, Midas
works with franchisees to develop plans to help
generate traffic and sales. Those plans might
21
include local media, direct mail and Yellow
Pages. In addition, Midas franchisees invest
$10,000 in Grand Opening marketing for a new
store, and Midas matches that investment with
an extra $5,000.
NEXT STEPS
Midas works with franchise
candidates to ensure we’ll be a
good match. Here’s a look at the
process
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Once you download our free franchise
report, we’ll be in touch to start or set up
a conversation. We’ll learn more about you
and give you a chance to learn more about
the Midas automotive franchise and why
we’re “Entrepreneur” magazine’s top-rated
automotive franchise.
Once we have established mutual interest
in a franchise partnership, you will be asked
to submit a formal application and to pay a
$5,000 deposit toward the payment of your
initial franchise fee. This payment does not
constitute a franchise agreement, and it is fully
22
refundable if you decide within 30 days not to
pursue the opportunity. It does, however, set in
motion a series of efforts on your behalf.
Midas will assist in site selection. Once your site
is approved, the process of build-out typically
takes 3 to 12 months depending on whether you
are acquiring an existing automotive business to
convert to the Midas brand or are building from
scratch.
Once you sign a franchise agreement, you
will be asked to complete our initial Operations
Training Program, which is designed to teach
you the core skills, techniques and tools that
you will use as a Midas franchise owner. The
program consists of two parts. Part 1 includes
five days of in-store observation at an operating
Midas shop, completion of an initial business
plan and an analysis of local competition. Part 2
is an instructional program held at our training
center in Palm Beach Gardens, FL, which lasts
a minimum of 10 business days. The training
program covers the tools, business systems and
Ready to learn more?
Email us at [email protected] and we’ll be in touch!
This report is not a franchise offering or an offer to sell a franchise. A franchise offering can be made by us only in a state if we are first
registered, excluded, exempted or otherwise qualified to offer franchises in that state, and only if we provide you with an appropriate
franchise disclosure document. Follow-up or individualized responses to you that involve either effecting or attempting to effect the sale
of a franchise will be made only if we are first in compliance with state registration requirements, or are covered by an applicable state
exclusion or exemption.
The following states regulate the offer and sale of franchises: California, Connecticut, Florida, Hawaii, Illinois, Indiana, Kentucky, Maryland,
Michigan, Minnesota, Nebraska, New York, North Dakota, Rhode Island, South Dakota, Texas, Utah, Virginia, Washington and Wisconsin.
If you reside in one of these states, or even if you reside elsewhere, you may have certain rights under applicable franchise laws or
regulations. MN Reg. File No. F-3.
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