Cellphone, Auto, Restaurant Chains Adding Local Franchisees

The Detroit News - A trio of national chains is expanding aggressively into Metro Detroit, signaling that some companies have enough faith in local discretionary spending power to create jobs and invest here.

Best Buy Mobile, the big box retailer's standalone cellphone business, is opening 10 stores here over the next few months. AAMCO, the transmission specialist and car care franchise, hopes to add 10 units in Metro Detroit over the next couple of years and is looking for franchisees. Jacksonville, Fla.-based Firehouse Subs plans to open 59 eateries in the state over the next decade.

"Good locations are available now and prices are more reasonable than they were in the past," said Southfield-based franchise expert Richard Simtob. "Banks are finally lending again, and some landlords are helping offset some of the costs of starting up a business. And there are people with money out there."

It's no surprise that Pennsylvania-based AAMCO is expanding in Metro Detroit, where people are keeping their cars longer and the dealerships that serviced those cars have shuttered, said Wayne State marketing professor Jeffrey Stoltman.

"The after-market for autos is very strong in the region, and there are quite a number of displaced autoworkers, so that might be the magic recipe in this case," Stoltman said.

AAMCO expanded its reach beyond its traditional transmission repair services five years ago to offer total car care, said Curt Hapward, vice president of sales and development. The franchise has six centers in Metro Detroit and can open at least 10 more without cannibalizing its current locations, he said.

AAMCO franchisee Tim Daley re-opened a shuttered location in Warren this month, creating four full-time and three part-time jobs. He hopes to open two more locations, including one in Commerce Township.

"There's a huge demand," Daley said. "New vehicle sales are down, but there are more people than ever driving."

The 49-year-old company has already proved itself by providing complicated transmission servicing, Hapward said. Convincing drivers to go to AAMCO for simple oil changes and maintenance services won't be difficult, he added.

"The total car care is where there's additional opportunity," he said. "The population is still there and they're holding on to their cars longer."

Healthier fast food cited

Firehouse Subs, a firehouse-themed quick casual eatery, plans to open 429 eateries in Michigan and eight other states. The concept is part of the growing fast-casual segment that offers a healthier alternative to traditional fast food, Simtob said.

"Because the sandwiches are oversized, people get a full meal for $5 to $7," said Flint resident and Firehouse Subs area coordinator John Kupiec. The sandwich category is expanding compared with more traditional fast food or quick casual pizza, burger and fry offerings, Kupiec said.

Going to the mall

Best Buy Mobile will grow from 194 standalone stores to 325 nationally by the end of February 2012, said President Shawn Score. Local industry watchers say the consumer electronics market is saturated, but Score said Best Buy Mobile's strategy — smaller mall standalone stores — appeal to consumers, especially women, who want convenience and assistance.

"We continue to see an increase in consumer demand despite the challenging economy because people want to stay connected throughout the day," Score said. "Our smaller Best Buy Mobile stores allow them to talk with our associates and look at a variety of smartphones and accessories across different carriers, in a mall environment they're visiting often anyway."

Best Buy Mobile opened stores earlier this month in Oakland Mall and Great Lakes Crossing Outlets, with new stores being considered in Dearborn and Westland.

Targeting mall lease spaces, where bargains are plentiful, is a sound strategy, Stoltman said. "I think Best Buy is leveraging their mega-brand and their national ad spending to provide a solid brand ellipse."

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