As the name suggests, Big O Tires LLC is a tire retail company. It is also a franchise and one of the best in the country.
It’s a great opportunity for anyone who is interested in launching a new business in this sector.
With almost any American owning a car, and with every car needing tire change and repair services, there is always high market demand for this type of service, and this is one of the secrets of the success of this franchise.
If you are interested in this franchise, you’ll need to know more about that because, as you may know, franchises are great opportunities, but they require some extra costs compared to self-owned businesses.
In this article, you’ll find all the information you need before purchasing a Big O Tires Franchise.
About Big O Tire Franchise
Big O Tires was born out of the decision of a group of tire dealers who wanted to band together and launch a company.
The idea behind their move was that, by merging their single activities and, therefore, their clients, they could make bulk tire purchases and get access to volume pricing.
As you know, volume pricing is lower than standard pricing: with this move, Big O Tires could afford to lower their prices and become very competitive in the market.
Today, they are still founding innovative ways to provide the most competitive and far-priced services to their clients.
History of Big O Tires Franchise
The Big O Tires company was founded in 1962. In 1996 it was acquired by TBC corporation, and in 2006, TBC Corporation was acquired by Sumitomo Corporation.
In 2018, Sumitomo signed a deal with Michelin North America INC and announced a definitive agreement. To these days, Big O Tires remains a subsidiary of TBC Corporation.
With its franchise program, Big O Tires was able to grow a lot: over the years, they opened many franchise units, and today, they can count 450 of them.
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Big O Tires Franchise: Business Model
Big O Tires offers many services related to car and vehicle tires: sales, servicing, alignments, tire changes, filter changes, oil changes, battery replacements, lamp replacements, brake services, and more.
The company is also a franchise, and they are currently open to new franchise applications.
| Company name | Big O Tires |
|---|---|
| Business Model | Franchise Automobile Service provider |
| Initial Investment | $311,000 and $1,138,300 |
| Franchise | YES |
| Franchise Fee | $35,000 |
| Royalty fee | 5% |
| Ad royalty fee | 5% |
| Number of units | 465 |
How Much Does Opening A New Big O Tires Franchise Center cost?
The total initial investment to launch a new Big O Tires franchise is relatively high.
Other than the franchise fee, which amounts to $35,000, you need to cover the expenses for the location, supply, equipment, hiring employees (an average of 10 employees is needed), marketing and advertising, insurance, and more. Keeping count of all these aspects, the total initial investment can be between $311,000 and $1,138,300.
Other than the initial fees, there are also ongoing fees that are due to the franchisor. These are a 5% royalty fee and a 5% advertising fee. These are both calculated on your gross sales.
Big O Tires Franchise: Requirements
Before opening a Big O Tires franchise, it is essential to carefully consider your experience, skills, and financial situation.
In order to apply for Big O Tires, you must have and demonstrate a net worth of $300,000 and a liquidity of at least $100,000.
Big O Tires Franchise: Training and Support
Training and Support are provided by the company, but it’s not included in the franchise fee; you’ll need to pay an additional training cost of $7,800.
Training includes two weeks of classroom training and two weeks of in-store training.
The company also provides recruiting assistance to help you hire your collaborators.
Big O Tires Franchise: Terms of Agreements and Renewal
The franchise contract with Big O Tires has a length of 10 years. After that, if the requirements are still met, you can renew the contract for an additional 10 years.
The details about the amount of the renewal fee aren’t public, so we don’t know how much you’ll need to pay to renew your contract.
However, this is an important detail, so make sure to ask for it before you sign your contract (or read the contract carefully because information like this must be written on it).
Big O Tires Franchise: Obligations and Restrictions
Possible Obligations and Restrictions will be indicated in the franchise contract. However, we already know that the recommended number of employees is 10.
Make sure to read the contract carefully to know about possible obligations.
For example, check if you, as a franchisee, are required to operate directly in the Big O Tires store or if you can hire a manager.
Big O Tires: Financial Assistance
Big O Tires provides in-house financial assistance: they can provide the most suitable loan for you to be able to cover your start-up costs.
They also provide financial assistance through third parties; in this case, they provide lease negotiation support.
Big O Tires provides financial Support for veterans. For them, there is a 50% discount on the initial franchise fee, which brings it down to $17,500.
Big O Tires VS MAACO Collision Repair & Auto Painting
| Company Name | MAACO | Big O Tires |
|---|---|---|
| Founded in | 1972 | 1962 |
| Franchise fee | $40,000 + | $35,000 |
| Royalty fee | 9% | 5% |
| Initial Investment | $250,000 -$350,000 | $311,000 and $1,138,300 |
Conclusion
The Big O Tires franchise is a huge opportunity for franchisees.
The initial cost of this investment might be high, but it would include important advantages, like the training you can receive from the main company.
Not all franchises provide the same amount of training as Big O Tire, and not at this level.
The mentorship provided by this franchise is never-ending – the franchisee can always refer to the franchisor who provides ongoing Support.
Big O Tires Franchise: FAQs
Is Big O Tires a franchise or a chain?
Big O Tires is a franchise. The company is very focused on its franchise program, and with time, it optimized it to provide the best opportunities to the franchisees.
Who is the current owner of Big O Tires?
Big O Tires is a subsidiary of TBC Corporation, and Christopher Cavalier is the current CEO.
How many Big O Tires units are currently there?
There are 465 Big O Tires locations in the United States.
Is Big O Tires a good investment?
Big O Tires can be considered a good investment because the profit is almost guaranteed.
You are never left alone in the management of your business. Furthermore, the brand is so well-known that you won’t struggle to find clients.
Is the Big O Tires franchise worth it?
The Big O Tires franchise requires quite a big initial investment.
Yet, if it fits your budget or if you can find a wise funding plan, it is definitely worth it for the reasons mentioned above.
Reference: Big O Tires Franchise Cost and Requirements for 2023 (ifpg.org)
Amit Gupta is the founder of DrFranchises – a digital marketing agency that helps brands rank better on Google Maps through local SEO strategies. Amit has over 11 years of experience in digital marketing, SEO, email marketing, and social media marketing. He’s also the owner of multiple franchises and has helped countless brands achieve success online. When he’s not working, Amit can be found playing with his dog.