Midas Franchise Review – Average, Median, High, and Low Total Revenues for Franchised Shops (2020 FDD) | Franchise Chatter

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Midas Auto Repair Franchise Photo by Lancastrian

In this FDD Talk post, you’ll learn the following:

  • Section I – Background information on the Midas franchise opportunity, including relevant news updates
  • Section II – Estimated initial investment for a Midas franchise, based on Item 7 of the company’s 2020 FDD
  • Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Midas franchise, based on Items 5 and 6 of the company’s 2020 FDD
  • Section IV – Number of franchised and company-owned Midas outlets at the start of the year and the end of the year for 2017, 2018, and 2019, based on Item 20 of the company’s 2020 FDD
  • Section V – Presentation and analysis of Midas’ financial performance representations, based on Item 19 of the company’s 2020 FDD, including information on the:
  • 2019 average, median, high, and low total revenue for the 10%, top 1/3, middle 1/3, bottom 1/3, bottom 10%, and all 939 Midas Shop outlets that were open for business for at least 12 months as of December 31, 2019, that were open for the full period of January 1, 2019 through December 31, 2019, and who reported sales for each month from January 1, 2019 through December 31, 2019

Section I – Background Information

14 Things You Need to Know About the Midas Franchise

Ranked No. 1 Full-Service Auto Repair and Maintenance Franchise by Franchise Times

1.  In early November 2020, Midas was recognized as the No. 1 full-service auto repair and maintenance franchise and number 80 overall on the Franchise Times Top 200+. As recognized on their site, the Franchise Times Top 200+ puts the spotlight on the strongest franchise brands, based on 2019 system-wide sales. The ranking reflects Midas’ strong sales performance in recent years – in particular since joining the family of brands owned by Florida-based TBC Corporation in 2012.

2.  Will Helton, vice president and general manager of Midas, said, “We are excited to be the number one full-service car care provider on the Franchise Times Top 200+ List. Being top in our category is a tribute to the drive, customer-commitment and entrepreneurial spirit of our franchisees. Together with our franchisees and their teams, we are taking Midas to new heights during unprecedented times and while facing an ever-changing environment. After breaking our all-time monthly sales record in June, we broke the record again in July. We look forward to continuing to build on our momentum.”

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3.  Midas distinguishes itself through a number of customer-centric shop processes, including presenting a written estimate before doing any work, offering a view into service bays in most locations, completing a complimentary, multi-point Courtesy Check for every customer, and explaining required services in plain language with an emphasis on what needs to be repaired now and what can wait.

Recognized as Major Franchise Opportunity for Veterans

4.  In early November 2020, Midas received recognition from Entrepreneur magazine in its annual ranking of franchise opportunities for veterans. The ranking spotlights franchisors that offer the best opportunities for military veterans interested in becoming franchisees, based on the incentives and support being offered, as well as how the brand scores in Entrepreneur’s Franchise 500 ranking.

5.  Midas has a history of assisting veterans. The company waives its $35,000 franchise fee for veterans and individuals serving in the U.S. and Canadian Armed Forces who are looking to join the ranks of its owner-operators. The incentive is available to anyone with an honorable discharge or those who are serving and eligible to receive an honorable discharge.

6.  According to five-store Midas franchisee Hugh Boeset, a former Infantry officer with eight years of service, “Joining Midas was certainly a very good decision for me and my family. Team building, leadership, persistence and resilience are all keys to being successful in the military – and these are the qualities you need to succeed as a Midas franchisee.”

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7.  Boeset said he sees similarities between the military and franchise organizations. “If you are coming out of the military, you are leaving a somewhat protected environment and potentially leaping into a riskier one. Being with a recognized brand mitigates this. In addition, there are turnkey characteristics to the Midas business – training programs, marketing programs, parts supplier relationships, and a whole host of support – so you aren’t having to create everything yourself.”

8.  Will Helton, vice president and general manager of Midas, added, “The fee waiver is geared to offering veterans with a growth mindset a great opportunity to go into business for themselves, but not by themselves. Midas has a lot to offer ambitious vets – an awesome brand, an expanding service menu, financial incentives and a very exciting business opportunity.”

Receives 2020 Game Changer Designation

9.  In mid-December 2020, Midas was named a 2020 Game Changer by Franchise Dictionary in its December 2020 issue. The designation reflects the brand’s appeal to veterans and millennials, along with its positive impact on the community and the opportunity it offers aspiring entrepreneurs. “A brand that earns the Top 100 Game Changers designation raises the bar and clearly sets itself apart,” said Alesia Visconti, CEO and publisher of Franchise Dictionary.

10.  The industry recognition caps a strong year for awards for the 64-year-old brand, which earlier in 2020 was named the number one full-service auto repair and maintenance franchise and number 80 overall on the Franchise Times Top 200+. Midas also received recognition from Entrepreneur magazine in its annual ranking of franchise opportunities for veterans.

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11.  “We are excited to be recognized as a Game Changer,” said Will Helton, vice president and general manager of Midas. “Winning the award is a tribute to the strength of our great brand and the drive, customer-commitment and entrepreneurial spirit of our franchisees. Together with our franchisees and their teams, we are taking Midas to new heights.”

Company History

12.  Midas, an acronym of Muffler Installation Dealers’ Associated Service, was founded in 1956 by Nate H. Sherman in Macon, Georgia. Sherman had worked for years in the automotive industry as he ran a family business in Chicago that manufactured car mufflers. As more people were able to own cars around that time, Sherman felt that traditional mom and pop corner gas stations would not be able to meet the growing demand for fast, efficient automotive service. Sherman started Midas with the intention to immediately start franchising. Midas was an instant success and by the end of 1957, there were 100 shops across 40 states.

13.  Over the next few decades, Midas continued to grow and began expanding its services. By the early 1980s, Midas had manufactured its 50 millionth muffler and had more than 1,000 locations around the United States. Midas’ success continued into the 21st century and the company is now one of the largest providers of automotive services in the world. Currently, Midas is owned and operated by TBC Corporation, which acquired Midas in 2012.

Entrepreneur’s Franchise 500

14.  Midas ranked No. 111 on Entrepreneur’s 2021 Franchise 500 list.

Section II – Estimated Costs

  • Please click here for detailed estimates of Midas franchise costs, based on Item 7 of the company’s 2020 FDD.

Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees

  • Please click here for detailed information on Midas’ initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2020 FDD.

Section IV – Number of Franchised and Company-Owned Outlets

Franchised

2017

  • Outlets at the Start of the Year:  1,017
  • Outlets at the End of the Year:  1,000
  • Net Change:  -17

2018

  • Outlets at the Start of the Year:  1,000
  • Outlets at the End of the Year:  986
  • Net Change:  -14

2019

  • Outlets at the Start of the Year:  986
  • Outlets at the End of the Year:  992
  • Net Change:  +6

Company-Owned

2017

  • Outlets at the Start of the Year:  0
  • Outlets at the End of the Year:  0
  • Net Change:  0

2018

  • Outlets at the Start of the Year:  0
  • Outlets at the End of the Year:  0
  • Net Change:  0

2019

  • Outlets at the Start of the Year:  0
  • Outlets at the End of the Year:  0
  • Net Change:  0

Section V – Financial Performance Representations (Item 19, 2020 FDD) and Analysis

  • Below is a chart showing the actual gross sales figures of U.S. Midas Shops during calendar year 2019.
  • The chart below (the “Calendar Year 2019 Chart”) is an historic financial performance representation reflecting the average and median of franchisee sales on an annual basis for the most recent calendar year of January 1, 2019 through December 31, 2019.
  • For purposes of the below information, gross sales means the total revenue of a Midas Shop, less taxes, discounts, rebates, and returns. In computing these figures, Midas took the average and median of the total sales of those outlets that fell into the top 10 percent, the top 1/3, the middle 1/3, the bottom 1/3, and the bottom 10 percent in total sales of the Included Shops (as defined below), as well as the combined average and median.
  • Additionally, the chart discloses the high and the low total revenue figure for every category of Included Shops.
  • Only U.S. Midas Shop outlets that were open for business for at least 12 months as of December 31, 2019, that were open for the full period of January 1, 2019 through December 31, 2019, and who reported sales for each month from January 1, 2019 through December 31, 2019 have their total sales included in the computations used in the Calendar Year 2019 Chart (the “Included Shops”).
  • The 63 Shops operating as Midas/SpeeDee Co-Branding Shops as of December 31, 2019 are excluded from the Included Shops.
  • There were 16 outlets that closed for various reasons during 2019, of which 0 had been open less than 12 months.
  • As of December 31, 2019, the 939 Included Shops in the Calendar Year 2019 Chart were about 95% of the 992 franchised Shops.

Average, Median, High, and Low Total Revenues in Calendar Year 2019

Top 10% U.S. Shops (94 Shops)

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