METAMORPHOSIS AIMED AT AFFILIATION
Four months after the project was announced, the first Driver franchise opened in Milan. For affiliates, an opportunity to offer full service for cars, a prerequisite for deseasonalizing business
Mino De Rigo
"Increasingly difficult times mean that we must gradually become better at our jobs: we believe that we can unite the best under the sign of the Driver chain", the network of Pirelli points-of-sale that inaugurated the first franchised outlet last October in Milan. A change in formula that aims at closer and more profitable partnerships, expands the services offered and takes a decisive step toward greater outlet harmonization. Fulvio Giambelli, CEO of Driver Italia and head of European retail at Pirelli, is convinced of it: "Tyre specialists who want to grow and increase the professionalism and quality of their services need more efficient and diversified management procedures designed to deseasonalize business, increase margins, and satisfy those customers who want full car service". This is the philosophy at the basis of the transformation of Driver, which already has 350 outlets and is now aiming at franchising: "By the end of the year we will have about ten and in two years at least half of the current members of Driver will have embraced the new formula". Affiliation that includes a substantial technical and commercial package, promo-advertising actions, and training because the main change will be the introduction of mechanical servicing from brakes and suspension to oil and filter changes, from small repairs to scheduled maintenance. "Moreover" - Giambelli added - "the package gives access to a series of framework agreements for the purchase of consumables, products and equipment, as well as dedicated management software and a web platform for group purchases".
Small mechanical jobs and additional services
50% of the products sold by franchisees must be by Pirelli, the remainder is up to them. To become part of this "new wave" chain, the POS must be located in a high traffic zone, have a surface area of at least 300 square metres and annual sales in the order of 4,500-5,000 tyres. "We have geomarketing tools for localizing suitable sites and assessing the number of potential customers before we send in our team of six professionals who work throughout the national territory. After Italy, we intend to take on other markets: Germany, Spain, Great Britain and even Poland and Greece". The economic conditions for Driver franchisees envisage an annual amount of 1,300 euros (plus VAT) and, starting from the third year of affiliation, royalties of 1% on sell out revenues. "It is a fairly small contribution" - Giambelli pointed out - "but we won't be using this aspect to convince entrepreneurs - who won't lose their independence by the way - to join our network; we believe they will realize that there are advantages of being part of a chain and having an entire package of tools and services which, if they are done well, will enable them to increase competitiveness and profitability and rationalize costs". The affiliate will find everything ready for starting up the additional services: "There will be no problems of finding and selecting the right suppliers and products, no time wasted negotiating supply conditions, and the application software also includes Customer Relations Management (CRM) procedures." Without doubt, one of the factors that persuaded Driver to push franchising is greater outlet harmonization.
Brand identity and classy reception
"We are now working on the entire network to ensure that the outlets are immediately recognizable and have the same sign and more or less look the same inside", Giambelli said. "Unlike franchising, our members are not obliged to identify their services with a precise chain, but in any case this will be the road to go." So as not to disorientate customers who probably expect to find the same layout and look in all Driver franchises. From the waiting room to the division of the work areas and the display of products and merchandising. "The investment" - Giambelli added - "for giving the outlet the brand identity and structure envisaged by the franchising programme is between 60,000 and 100,000 euros, depending on size and the amount of work to be done. At a Driver franchise, customers are received in a reserved area, they know exactly how much the maintenance and repair work will cost, how long it will take, and they can even watch the work on a special monitor". It is one of the aspects of reception that is a characteristic of the new formula, "an element of added value about which leasing and rental companies should be particularly aware".
• Franchising for a tyre boutique
The sign has been on display for ten years above the outlet at 22 Via Certosa in Milan, which has been renamed "the Tyre Boutique". And it really is a boutique, not just because of its window displays of watches, models, neckties, brand new accessories and spares, but because of an all-pervading glamorous touch that conveys a feeling of refinement. An important investment in expansion, reorganization and furnishings in line with the identity of the Driver franchisee. Owners Massimo and Micaela Franchi are still committed and passionate about the business inherited from their father, Roberto, and can reopen their doors with the boast that they are the first to adopt the new formula. "Whether it was to alternate quiet spells with seasonal peaks" - Massimo Franchi recounted - "or to differentiate ourselves on the market by getting away from the old idea of a tyre specialist, we were convinced that there was a need for a substantial metamorphosis. The debut was on the full car service model: because Driver and Pirelli have also decided to aim at this and the rest was the logical consequence". A kind of evolution of the species that levers the introduction of new services, primarily small mechanical jobs. "It was the customers themselves who asked for it, and if the market responds in the way we expect, we'll be happy to add to our work team". Four technicians who share the five lifts for cars and commercial vehicles and one for motorbikes. An annual turnover close to one million euros and a few thousand customers, the new Driver franchise is a convincing prototype. "Loyalty" - Micaela Franchi said - "is already very high, but we are counting on increasing it by leveraging a comprehensive package of services for the entire vehicle, from text message reminders about scheduled work to regular promotions, as we already do for our loyal customers, the "Pirelli friends".