Express oil change franchise Cost, Profit & Failure Rate 2024

When considering the opening of a new franchise, various factors must be taken into account. Costs, including franchise fees, are only some of the elements that require analysis.

One of the most crucial considerations is the type of business being launched: does it meet market demand?

Is there a high demand for the products or services being offered? Is the business targeting a specific niche?

Express Oil Change ticks all the boxes in this regard. It is reasonably priced, caters to a specific niche, and there is a high demand for the services it provides.

In a country where almost every individual owns a vehicle, Express Oil Change offers oil change and car maintenance services.

Express Oil Change Franchise
Express Oil Change Franchise

The Express Oil Change franchise program is outstanding and allows individuals to start a new business under a well-established brand name.

Read on to learn all you need to know about the Express Oil Change franchise.


About Express Oil Change Franchise

The Express Oil Change franchise has a unique business model: they provide an oil change service in 10 minutes while the customers wait inside their cars.

This was, at least, the original main activity performed by Express Oil Change operators; with time, the type of service the company provides has evolved, and today they can offer full maintenance services.


History Of Express Oil Change Franchise

History Of Express Oil Change Franchise

The Express Oil Change company was founded in 1979 in Birmingham.

As we’ve mentioned, the business started as a provider of a quick oil change service: people who needed oil changes for their cars could hire Express Oil Change to have the quickest service, even while they were waiting inside their cars.

With time, Express Oil Change widened its offer of services: today, they no longer offer only the oil change service but also tire change and mechanical full-service on vehicles.

In 1984, Lunvefors – the founder of the company – decided to start franchising.

The story of the company continued with various acquisitions that allowed it to keep growing. The growth was such that, in 2022, they could count 322 locations.

These locations, however, aren’t all franchised: 264 locations are owned by the company (they are corporate), while the remaining 58 are franchises.


Express Oil Change: Business model

Express Oil Change is a company active in the sector of car maintenance, and it is open to franchises.

They have many units operating throughout the United States, but not all of them are franchises: some are corporate, and some are franchised.

Company nameExpress Oil Change
Business ModelCar-service provider
Initial Investment$200,000
FranchiseYES
Franchise Fee$35,000
Royalty fee5%
Ad royalty fee3%
Number of units58 (franchised)

How Much Does It Cost To Open An Express Oil Change Franchise?

Starting a new Express Oil Change franchise can be rather expensive because you’ll need to set up an entire car-service provider unit.

The total initial investment can be estimated at $200,000. Of this, $35,000 is due as a franchise fee, and the remaining money will be invested in the location (rent and setup), equipment and supply, and marketing.

The franchise fee isn’t the only fee that is required by Express Oil Change: there is also a 5% royalty fee and a 3% ad royalty fee. These percentages are calculated on your gross revenue.


Express Oil Change Franchise Revenue & Profit

Express Oil Change Franchise Revenue & Profit

The revenue and profit of different Express Oil Change franchise owners could be different depending on the location of their outlet, its size, demand, etc.

But on average, an Express Oil Change franchise owner makes $1,609,000 in annual revenue. So if we assume a profit margin of 15% as per the industry standards, then we can calculate that an Express Oil Change franchise owner make $241,350 in net profits on average.

You must note that this data is based on the sales of 54 franchises that were operating in the year 2021.

Financial OverviewPercentage of RevenueAmount ($)
Individual Franchise Annual Revenue100%1609000.00
Rent10.63%(170956.25)
Insurance5.31%(85478.13)
Salaries21.25%(341912.50)
Franchise Royalty Fees5.31%(85478.13)
Utilities2.13%(34191.25)
Cost of Goods Sold (COGS)26.56%(427390.63)
Labor (Variable)13.81%(222243.13)
Total (Expenses)85.00%(1367650.00)
Net Profit15.00%241350.00

Note: The displayed expenses are estimates based on industry averages and standard costs. Actual expenses may vary due to factors like location, business size, and market conditions. We recommend conducting detailed research or consulting with a financial advisor for a tailored financial analysis


Express Oil Change franchise: requirements

Express Oil Change requires a net worth of about $500,000 and liquid cash of about $350,000.

As you can see, requirements are rather limiting: not everyone has this type of capital at their disposal. If it fits your budget, however, this can be a great investment.


Payback Period Of Express Oil Change

With an investment of $200,000 and an estimated 15% profit on the average net revenue, the yearly profit would be $241,350.

So, to find out how long it will take to earn back the initial investment:

Payback Period = Investment / Yearly Profit = $200,000 / $241,350= 0.82 years

Based on these figures, it will take approximately eight-twelve months to pay back the initial investment for Express Oil Change. This time period could be longer or shorter depending on your sales, revenue, and profit figures.


Failure Rate Of Express Oil Change

Franchised Outlets:

YearOutlets at the Start of the YearOutlets at the End of the YearNet Change
2019114110-4
2020110109-1
202110958-51

For the Franchised outlets:

  • In 2019, the failure rate was (4)/114×100≈3.50%
  • In 2020, the failure rate was (1)/110×100≈0.90%
  • In 2021, the failure rate was (51)/109×100≈46.78%

Company-Owned Outlets:

YearOutlets at the Start of the YearOutlets at the End of the YearNet Change
2019135151+16
2020151182+31
2021182251+69

For the Company-Owned outlets:

  • In 2019, the growth rate was (16)/135×100≈11.85%
  • In 2020, the growth rate was (31)/151×100≈20.52%
  • In 2021, the growth rate was (69)/182×100≈37.91%

Total Outlets:

YearOutlets at the Start of the YearOutlets at the End of the YearNet Change
2019249261+12
2020261291+30
2021291309+18

For Total outlets:

  • In 2019, the growth rate was (12)/249×100≈4.81%
  • In 2020, the growth rate was (30)/261×100≈11.49%
  • In 2021, the growth rate was (18)/291×100≈6.18%

According to the above-mentioned data, we can see that the franchised outlets for Express Oil Change declined from 2019 to 2021, showing a failure rate between 3.50% and 46.78%.

On the other hand, for company-owned outlets, the growth rate of Express Oil Change was quite high, lying in the range between 11.85% and 37.91% for the same period of time.

Overall, when we combine the data of franchise and company-owned outlets, we can see that the Express Oil Change franchise has expanded in the years 2019-2021, showing a total growth rate between 4.81% and 6.18%.


Express Oil Change franchise: Terms of agreements and renewal

The franchise contract with Express Oil Change lasts for as long as you pay the royalty fees. There is no renewal fee.


Express Oil Change Franchise: training and support

Express Oil Change Franchise training and support

You can start an Express Oil Change franchise even if you are not an engineer or a mechanic.

The company offers an 8-week training program to their new franchisees, which provides all the information they need to carry out their franchise activity.


Express Oil Change Franchise: Obligations and Restrictions

When you start an Express Oil Change franchise, you can open your car-service business activity and exploit the Express Oil Change brand name.

There are no strict restrictions for franchisees, but always make sure to read your franchise contract carefully.


Express Oil Change: Financial Assistance

Express Oil Change franchise does not provide direct financial assistance.

However, they can provide third-party financial assistance through external firms that can offer funding to assist franchisees in setting up their new franchise business.

The automotive service franchise market offers several opportunities for entrepreneurs, such as franchises from AutoZoneAAMCOMAACO franchiseNapa Auto Parts, and Tint World Franchise.


Express Oil Change VS Auto Appraisal Network

CompanyExpress Oil ChangeAuto Appraisal Network
Founded in 19791989
Franchise fee$35,000$16,700
Royalty fee5%None
Initial Investment$200,000$20,000

Conclusion

The Express Oil Change franchise isn’t the cheapest franchise available. It’s a big investment and, like all big investments, it can generate great profits.

Owning a franchise, the initial expenses can be higher, but the road to success would be smoother and shorter.


Express Oil Change: FAQs

Is Express Oil Change a franchise or chain?

Express Oil Change is a franchise. It’s open to franchise applications, but it also opens new units directly.

As a result, some of the Express Oil Change is corporate; some are franchises.

Who is the owner of Express Oil Change?

Jim Durkin is the current president of Express Oil Change, while Richard Brooks is the current CEO.

How many Express Oil Change units are there?

There are 322 locations in the United States, of which 264 are corporate, while 58 are franchises.

Is Express oil Change a Good Investment?

Express Oil Change is considered a good investment because the brand is well known, and you’ll have no difficulties conquering your first clients.

Furthermore, there is always a high demand for the type of services this business provides, and this guarantees longevity for the business.

Is the Express Oil Change franchise worth it?

The initial investment required to start a new Express Oil Change franchise is rather high.

However, it is still considered worth it because you can generate high profits.

Furthermore, you can obtain funding for your franchise business to assist you at the beginning of your career.

With a brand name so well known and market demand so high, this franchise is 100% worth it.

Where is Express Oil Change headquartered?

Express Oil Change is headquartered in Hoover, AL, United States.

Reference: Express Oil Change Franchise – How To Open, Cost & Profit (startupback.com)Express Oil Change & Tire Engineers – Wikipedia

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