Aarons 2007 Annual Report Download - page 9

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7
Company Pretax Profit
From Franchising
Aaron’s Sales & Lease Ownership
The Aaron’s Sales & Lease Ownership division is
the Company’s largest and the primary engine of
growth. Stores offer credit-constrained consumers
a broad array of quality home furnishings and elec-
tronics. The sales and lease ownership model offers
consumers unique benefits compared to retailers
that offer financing vehicles. The Aaron’s business
model is based on 12-, 18-, or 24-month lease pay-
ment options with a “cash and carry” price and a “90
Day Same as Cash” option. The stores are typically
freestanding and attractively displayed, offering a
broad selection of electronics, furniture, appliances
and accessories. Key features of the Aaron’s Sales &
Lease Ownership model include:
• Same or next-day delivery, free of charge
• Flexible payment options (cash, check, credit
and debit cards)
• No application fees, no balloon payments,
no credit reports
• Monthly or semimonthly payments
• Quality brand-name products with repair or
replacement guarantees
• No long-term obligation
• Lower total cost than rent-to-own competitors
With a lease arrangement, a customer can return
product at any time. Accordingly, customer service
is critical to our success. We utilize in-house
training and employee development programs
through Aaron’s E-University to enhance customer
relations skills, promote uniform customer service
standards and distribute timely information about
new products and promotions. Key features of our
customer service
include free delivery
of our products
and free service
on products under
lease. Our best
customers
have multiyear
relationships with
the Company and, importantly, over 45% of our
customers complete the lease term and obtain
ownership of their merchandise, a significantly
higher percentage than the rent-to-own industry
Company Revenues
From Franchising
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
$40,000
0
5,000
10,000
15,000
20,000
$30,000
25,000
2003 2004 2005 2006 2007
($ in thousands)
2003 2004 2005 2006 2007
($ in thousands)
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