Aarons 1999 Annual Report Download - page 9

7
The Rental Purchase Franchise Momentum.
Franchising has moved into an exciting new
stage of growth driven by multi-store franchise
owners. These experienced business people and
financially savvy entrepreneurs see an Aaron’s
Rental Purchase franchise as a golden opportu-
nity and they are making the most of it.
During the past year thirteen current owners
acquired the right to open 47 additional stores,
while 14 new franchisees signed on to open 51
stores in the future. This “repeat business” is
the ultimate testimony to the validity of the
Aaron’s franchise program— the only major one
in the industry — and validates the Company’s
decision to develop multi-store ownership as
the avenue to quality, rapid growth.
The strong trend of current owners
expanding enables the Aaron’s Rental Purchase
franchise program to grow faster and more
efficiently, resulting in higher profitability over
the long term. Owners of existing stores can
open new stores more rapidly and benefit from
economies of scale and reduced costs.
Rental Purchase Franchising
Our growth strategy gained new momentum
in the past year with the improved Aaron’s
financing program. This $52 million facility
with four major banks, replacing a $40 million
financing plan, provides the funding for new
franchise owners and offers qualified, experi-
enced owners access to a long-term, revolving
credit facility. As expected, the availability of
capital for new store openings accelerated the
growth of the division. Franchise owners are
able to open a larger number of stores more
quickly and reach their profit goals, resulting
in increasing profitability to them and the
Company.
Aaron’s consistently ranks among the best
franchise programs in the entire country, placing
near the top in national surveys.
The criteria used in awarding the top
rankings indicate the strength of the Aaron’s
franchise program. Winners are selected on the
basis of the company’s financial performance
including revenues, franchise fees and propri-
etary goods and services; the corporate manage-
ment and the company’s growth and stability;
the all-important relationship between fran-
chisor and franchisee; and the opportunities
for growth available to the franchisee. Judged
on all these points, Aaron’s stands among the
leaders year after year.