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RAW Franchise Program

Rent A Wheel

Founded in 1996, Rent A Wheel started with one store in California. Since its modest beginning, the company has become the largest Rent-To-Own Custom Wheel and Tire Retailer in the nation with over 130 stores across 15 states. The company is also the 7th largest independently owned tire dealer in the country.

Rent A Wheel was founded on the principle of providing the highest quality product and service for a fair price. With over 24 years of straight-up, real world experience, we understand who our customers are. That's why we combined our mission with the offer of a rent-to-own option. Many customers buy our products and services at retail to take advantage of our low prices.

However, many customers like the flexibility of a rent-to-own transaction. This "no obligation to buy" agreement gives customers the opportunity to try the wheels and tires and return them for any reason, or they can buy them within 120 days for the same retail price as if they bought them the first day, or continue with the low payments and buy the wheels and tires at any time over the first year at 50% off the remaining agreement value. With Rent A Wheel's flexible programs, stylish product offerings and unique brand positioning, we are confident that our franchise program offers today's entrepreneur more potential for growth and profit than at any other time in Rent A Wheel's history.

The Rent-To-Own Market

The traditional rent-to-own market is nearly $8.5 billion in annual revenue and having only penetrated 10% to 12% of the potential market, there are still tremendous opportunities for growth in this segment.

According to the U.S. Department of Commerce, between 2000 and 2012, American households actually experienced a decline in real median income of 6.6%. Combined with the continued tightening of consumer credit and the growing number of American households with real annual earnings under $75,000, there is an unprecedented demand for the rental of big ticket goods.

The rent-to-own customer's wants and needs are no different from those of buyers with credit. For the millions who cannot afford to purchase products outright, or do not have the credit to finance the purchase, Rent A Wheel is quickly becoming a major source for providing custom wheels and performance tires.

That's one of the truly rewarding aspects of operating this neighborhood business. You provide an alternative source for products to customers who might not be able to finance their purchases through more traditional retail means.

DISTRIBUTION OF HOUSEHOLD INCOME
HOUSEHOLD INCOMES PERCENT OF TOTAL SALES
UNDER $15,000 13%
$15,000 TO $24,999 11.9%
$25,000 TO $34,999 11.1%
$35,000 TO $49,999 14.1%
$50,000 TO $74,999 18.1%
% OF HOUSEHOLDS EARNING UNDER $75,000 68.2%

*Total U.S. Households 117,538,000
*Sources: U.S. Bureau of the Census 2012

The Wheel and Tire Retail Market

The traditional replacement tire market is much larger than the Rent-To-Own market. According to the Bureau of Transportation Statistics, there are over 250 million passenger vehicles on U.S. roads. There are several major trends that are shaping the future of the custom wheel and tire business today. First, Americans are becoming increasingly mobile. They take an average of 1.1 billion trips daily, averaging 40 miles per trip. Additionally, the average age of passenger cars and light truck in the U.S. is 11.5 years, and currently only 8% of U.S. households do not have vehicles. According to Modern Tire Dealer, who has been covering the North American tire marketplace for nearly 50 years, U.S. replacement tire sales for passenger cars and light trucks were nearly $30 billion in 2013. Simultaneously, Americans are becoming increasingly style conscious with their vehicles and they view their vehicles as an extension of their personality. In fact, nearly 36% of the 201.6 million passenger tires sold in 2013 were High Performance or Ultra High Performance tires. The performance and customization products available today give vehicle owners the opportunity to further personalize their cars or light trucks. For our target audience, custom wheels are the driver behind each transaction, symbolizing an elite status for the buyer among their peers. This must-have, emotional purchase stems from the genuine car enthusiast background and vehicle transformation that custom wheels provide. Rent A Wheel is uniquely positioned to satisfy this market segment with the industries most extensive in-stock wheel and tire inventory and flexible buying programs.

2013 U.S. REPLACEMENT TIRE SALES
TIRE TYPE TOTAL SALES
Passenger Tires $25.0 BILLION
Light truck tires $4.9 BILLION
2013 REPLACEMENT PASSENGER TIRE MARKET
TIRE TYPE MARKET %
Other 62.2%
HP 18.1%
UHP 17.4%
Winter 2.3%

*Based on 201.6 Million units Shipped

A Unique Position In The Market

Rent A Wheel offers another choice in the wheel and tire market, a choice that falls outside conventional retailing for those customers who want custom wheel and tires but cannot afford them through traditional retail means. If the customer wants temporary use of a quality product at an affordable price, Rent A Wheel provides that option. If the customer wants ownership at an affordable price, Rent A Wheel also provides that option. This positions Rent A Wheel into the much larger retail market place and leaves enormous potential for growth for Rent A Wheel.

In fact, there is little disparity between the final purchase price at Rent A Wheel and the final purchase price at a conventional wheel and tire retailer after interest and service charges. In some cases, our "cash and carry" prices are actually lower than some retailers.

Thus, Rent A Wheel offers a retail value plus the added services of no credit checks, no debt obligations and absolutely no obligations to the customer beyond the current rental payment due. If the customer's needs or financial circumstances change, they can return the products with no further obligation, and no debt. Contrast that with installment credit sale, typically offered by wheel and tire retailers, which obligates the customer to pay the full amount regardless of the circumstances. This kind of service is an "added value" for our customers and the substantial difference between our business and the conventional wheel and tire retailer's business. At Rent A Wheel, the customer gets more than simply the product and we are committed to continuing strong growth with this new concept because it satisfies the customer's needs.

The Rent A Wheel Advantage

Your Rent A Wheel Franchise will be your business. Yours to operate and yours to build...but you will benefit greatly from your affiliation with a large national organization. In addition to the prestige and instant name recognition, you will enjoy unparalleled training and ongoing support. Today, with the benefit of over 24 years of experience, Rent A Wheel is still the leader and innovator in program development with our Inventory Management System and unique on-line marketing programs being perfect examples.

Rent A Wheel can also benefit existing independent wheel and tire rental dealers. Although these experienced rental owners are familiar with the complexities of the business, they may have been unable to grow or effectively compete due to inadequate purchasing power, deficient marketing techniques or marketing muscle, few training programs and insufficient capital to purchase inventory or take advantage of emerging profit centers.

By joining forces with Rent A Wheel, rental dealers are able to enjoy the advantages of our system and still maintain the independence they desire.

Once you have made your decision to join the Rent A Wheel franchise family, you will be supported by the finest and most knowledgeable group of professionals in the custom wheel and tire rental industry. Not only have we developed the most effective methods of operation, but we stand behind them as well.

The advantages of the Rent A Wheel system include: in-depth site selection assistance, personnel selection assistance, comprehensive training for you and your staff, computer hardware and software systems, marketing and advertising support, inventory support and financing, volume purchasing, network communications and on-going support to ensure your success as a Rent A Wheel franchisee.

Pre-Opening Assistance

When you sign the Franchise Agreement our guidance and support begins with advice on how to locate a superior site for the wheel and tire facility. We provide you with a site model which is built around the critical location factors of a successful Rent A Wheel location. Because a strategic location in a prime high-traffic business district is such a key ingredient in the success of the operation, a member of our Pre-Opening Team will visit the market and guide you through the selection process. They will assist you in carefully analyzing the potential of the proposed sites and advise you on negotiating a prudent lease.

Once the site selection is made, our representatives will assist you in designing the floorplan, including the proper layout of the showroom and service area with ease of operation in mind. To complement the overall look, the unique style of a Rent A Wheel décor will be installed. This recognizable design includes interior wall graphics, informative interior signs, and an appealing exterior sign(s) identifying the facility as part of the nationwide Rent A Wheel network.

  • Establishing a business plan
  • Shopping the competition
  • Publicity releases and news releases
  • Pre-opening advertising
  • Ordering initial inventory
  • Special rates on equipment
  • An initial supply of operational forms
  • A decal kit for the delivery vehicle
  • Training at our Franchise Support Center
  • And much more

Inventory Financing

As you can imagine, one of the largest expenses in operating a Rent A Wheel business is inventory. Since you have to purchase inventory and only derive revenue over the rental payment schedule, substantial capital could be required to build your business. Or, at the very least, your ability to expand could be seriously curtailed if you lacked adequate capital.

Rent A Wheel understands the financial needs of the growing rental dealer and can assist you in properly managing your inventory financing.

We provide inventory financing that recognize the intricacies of your business and that your business’s potential depends upon the working relationship between you and your lender. We have developed special programs to complement the financial needs of the rental business and make inventory financing both convenient and affordable.

Advertising and Marketing

Through many years of consistent marketing, Rent A Wheel has become one of the most recognized and respected names in the custom wheel and tire rental industry. Your affiliation with the Rent A Wheel name will generate immediate response and deliver customers to your store. Rent A Wheel is a believer in advertising that is accountable and measureable. We have one common goal:

to rent or sell merchandise utilizing the most effective and efficient advertising tools. With a keen sense for the customer, Rent A Wheel is equipped to offer point-of-purchase, print, radio and on-line advertisements. All of these items are designed to give your business high visibility and a memorable identity to the consumer.

Franchise Support Center Training

New Rent A Wheel franchisees are required to attend a comprehensive training course either online or at our headquarters in Los Angeles, CA. You will work with our professional trainers covering every aspect of running a profitable Rent A Wheel business.

  • How to recruit, train, motivate and supervise key personnel
  • Proper store design and merchandising to ensure the store has the proper appearance
  • Product features and benefits that allow for knowledgeable customer presentations
  • Computer software system designed for efficient store operations
  • How to attract a solid customer base utilizing promotional programs designed to generate a highly visible profile that will make the Rent A Wheel business well recognized and respected in the marketplace
  • Inventory control procedures established to minimize interest expense and maximize profits
  • Advanced face-to-face floor selling techniques designed to improve the closing ratio and increase the average income

Additional training programs including national or regional Rent A Wheel-sponsored managers’ meetings and annual manager’s meetings help ensure our training program is relevant and up to date.

Q&A

The Franchise Agreement will clearly define your territory within a specified radius of your location(s).
Yes. If you would like to open additional stores to meet the demand in your market, a development schedule can be prepared to guide you toward a multiple store operation.
The initial term of the Franchise Agreement is ten years. It is also renewable for an additional ten years.
In order to maintain the full-service image commensurate with a Rent A Wheel store, we request that you stock and display certain products. Although we purchase wheels and tires from suppliers at deep discounts, you are not obligated to purchase inventory through Rent A Wheel.
As we move further along in the selection process, Rent A Wheel will provide you with a Franchise Disclosure Document (FDD). Included in the FDD is a Financial Representations Document which indicates the actual earnings of many of our existing company owned stores.

Rent A Wheel's Selection Process

Rent A Wheel's reputation and growth is determined by the individuals who represent us in the marketplace. Your investment with Rent A Wheel is really an investment of yourself. Our selection process is designed so that you and Rent A Wheel will have ample time and information to make an informed business decision.

Several meetings will take place in both your maket and at our corporate office in Los Angeles. There is no definite schedule for these meetings, but you should:

  • Review the information in this site and talk with the Vice President of Franchising to answer any questions you may have
  • Complete the Confidential Personal Information Form and return it to the address provided
  • Schedule a day to visit our corporate office for a presentation on the Rent A Wheel franchise program
  • Receive the Franchise Disclosure Document (FDD) and sign the Acknowledgment of Receipt Form as required by the Federal Trade Commission
  • Understand the limitations and potential of the franchise
  • Develop a simple business plan that will enable you to make the right decision and secure adequate financing, if necessary

Through this process, you will receive a substantial amount of information on the industry and Rent A Wheel. Because this is a major commitment for both parties, we want to make sure we will have enough information regarding one another to determine if we are a good match.

Building Success Through Helping People

Rent A Wheel's people are the backbone of the company. Their dedication and commitment to excellence have enabled us to achieve the status and market share we enjoy today. Our philosophy is to provide an environment in which our franchisees can develop to their fullest potential.

Now that you've had the opportunity to become better acquainted with our company, I invite you to contact our Vice President of Franchising, so together we can determine if our franchise program is right for you. Call 818.786.7906 x287.

Your Investment

Although the investment to start a Rent A Wheel Franchise will vary depending on the cost of doing business in your market, the following are estimates.
Type Of Fee Low Estimated High Estimated Method of Payment When Due To Whom Payment is to be Made
Initial Fee 1 $50,000 $50,000 Lump Sum After Signing Franchise Rent A Wheel
Real Estate 2 $3,000 $8,000 As Arranged As Arranged Landlord
Leasehold Improvements 3 $2,000 $80,000 Progress Payments As Arranged Landlord or Contractors
Signs 4 $50 $200 Direct Withdrawal Weekly Rent A Wheel
Computer Equipment 5 $9,000 $13,000 As Arranged Before Opening Rent A Wheel and Vendors
Equipment and Fixtures 6 $20,000 $30,000 Financed or As Incurred As Arranged Rent A Wheel and Vendors
Vehicle 7 $1,500 $7,600 As Arranged As Arranged Vendor or Lessor
Insurance 8 $6,500 $11,000 Down Payment Before Opening Insurance Companies
Travel and Living Expenses While Training 9 $500 $10,000 As Arranged Before Opening Suppliers of Transportation, Food and Lodging
Opening Advertising 10 $3,000 $9,000 As Arranged Before Opening Vendors
Initial Inventory 11 $5,000 $80,00 As Arranged Before Opening Vendors
Legal and Accounting Fees $2,000 $5,000 As Arranged Before Opening Vendors
Additional Funds-3 to 12 Months 12 & 13 $56,000 $200,00 As Incurred As Incurred Employees, Vendors, Suppliers and Utilities
Totals $158,550 $503,800

Typical Working Capital

You will also need in cash and/or a line of credit, sufficient capital to cover installment floorplan payments on inventory re-orders (re-orders range from approximately $3,000 to $80,000 each month) and to cover all the general operating expenses of your Franchise until it reaches a break-even point. The level of growth the Franchise achieves, and whether you pay cash for or finance your inventory re-orders, will determine your break-even point and the amount of working capital you will need.

During the early stages of the business you may need additional funds for personal living expenses.

Revenue Split That's Advantageous to You

Rent A Wheel receives a continuing license fee of 6% of total revenues for the term of the Franchise Agreement. Total revenues are defined as the sum of all revenues generated in connection with the Franchise Business.

The exterior signs, which vary in cost from $10,000 to $18,000, are purchased by Rent A Wheel and leased to you over the first five years of your Franchise Agreement.