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Midas regains its touch
Just a little over 2 years ago, Midas was heading into administration and fighting for its survival. The brand was tired and lacked relevance. Franchisees were enraged with the lack of leadership and growth. Suppliers were lucky to be paid. And employees lacked the motivation and direction needed to turn the business around. In November 2008, Tim Hickey (ex senior Yum executive) took the reigns as the new CEO of Midas. He quickly rationalized staff and with his key lieutenant, Glenn Jarrett (Midas Chief Operating Officer), began the task of rebuilding the foundations of the business. Midas is a new world today for customers, franchisees, suppliers and employees. Some notable changes are: The team put a stake in the ground and declared that they would bring honesty and transparency back to the car service business under the banner of their ?know where you stand? culture push.
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?This attitude reflects the way the company deals with its Franchisees ? nothing is hidden from us. A dedication to transparency and honesty starts with the company?s leadership and works its way down the chain of command and through all of the Franchisees. The system set up by the company is then carried out by individual store management.? - Darren, Yarraville Franchisees now believe in the business and are experiencing strong growth (+6% sales growth this year) and as a result, more are stepping up and buying a second store. Franchisees, often with their life savings tied up in the business, now feel great to be part of the Midas network and are motivated to take care of customers like never before.
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"The best thing about being a Midas Franchisee is the freedom you get from being your own boss. I?ve been a Midas Franchisee for seven years now and I love being part of one large group under a great name. It worked so well for me that I even opened a second store! The system that Midas has created really sets it apart from other shops ? the leadership works hard to keep you informed, and that transparency flows all the way down to our customers. Initially, running two stores was an ambitious endeavour, but I love my work and have the amazing Midas support system behind me." - Rob, Darlington Midas was well known as a muffler place but was not a key player in the lucrative car service category. Midas launched their $139 complete service with a national guarantee to cut through and offer honest value that would declare to customers that they now have a reliable, affordable car service alternative. Car servicing is now in excess of 50% of business mix and customer growth is +6% this year alone.
The team at Midas brought the cultural initiative of transparency and honesty to current and new franchise relations. Having come out of administration with a very poor reputation for franchisee support, the team had to lead from the front and demonstrate that they would always do the right thing. Eventually, as they walked the talk, franchisees embraced the business and in 2 years the team has sold 17 stores. Some have been to new franchisees and some have been to Midas company store managers that stepped up, put their houses on the line and became business operators.
?I started with Midas in 2011, finishing off my last two years of apprenticeship with them. I always wanted to own and run a mechanics garage. I looked to open up independently however after having a chat to Glenn (COO) they had agreed to a good price for a Midas franchise. It was a great offer; I knew the processes and knew how the Midas system worked. The biggest benefit is the constant feed of work, national advertising and marketing campaigns, support from the Field Support Centre and the brand name that helps generate business both repeat and new. Plus support in running the business is always on offer. Anne (Legal and Property Manager) at the FSC really helped out ? she even pushed for me to get everything independently checked by an accountant and solicitor. I can?t say anything bad about Midas. In fact, I?d love to buy a second franchise, if the opportunity arose, but further down the line. I need to concentrate on this one first.? ? Matt, Hornsby Key suppliers were owed much money at the time of administration and Midas were put onto ?cash on delivery? terms. The new team have worked with the same transparency and honesty in other parts of the business and suppliers have now restored favourable trading terms.
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Midas has begun an ambitious program of re imaging all of their stores in the next 18 months. A new striking and cost effective re image package was put together with the help of the Midas creative agency, McCann, and in this year alone 20 stores will be upgraded to the new look increasing not only the value of the store but the Midas network as a whole.
Midas is now back on a growth path. After closing over 60 stores 2000-2009, Midas has now opened 6 new stores and has plans to expand to a 100+ network over the next 2 years. Midas by successfully exiting administration and getting back to profitability has saved the jobs of over 100 Australian?s that would have otherwise been looking for work. None of it counts, however, if you are not making money. In 2 years the team, without bank support, have paid off $0.5m in debt, all new store capital expenses and have re imaged a number of store assets, all with cash generated from operations. Profit, which was once so negative it drove the company into administration, is now positive and growing (FY ?11 profit growth is forecast to be almost 100% on prior year).
To find out more about the great opportunities available & benefits of becoming a Midas franchisee please visit www.midas.com.au/franchising
