AutoStar Superstore in 2011

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Important Strides Forward

It’s been a busy two weeks since the start of the year here at the AutoStar National Dealer Network^®.  As with all businesses it has been a time to analyze what we accomplished last year and set goals for this year.  While we have not grown as quickly as we wanted to when we started the Network, we have made some important strides and accomplished a great deal thanks to the partnerships we have with some of the biggest companies in the automotive industry.

From the beginning our goal was to become a quality used vehicle retailer like Carmax^®, but with much more emphasis on the service, parts and body shop part of the business.  Let’s face it, at Carmax^® it’s buy the car and then goodbye.  Don’t get me wrong, they do a great job selling cars. They sold 349,000 cars in 100 locations last year.  Their message is simple: they will treat you nice and buy your trade in even if you don’t buy from them.  Guess what?  AutoStar Superstorestores^® can treat you nice and buy your trade in even if you don’t buy from us, plus we have the EverStar^® Lifetime Engine Guarantee with lifetime wiper blade and brake pad replacement.  No one else has EverStar^®, and it ensures that customers will come back to the selling dealership every three months or 3,000 miles for all service.

Becoming a Dominant National Dealer Network

When you look at the history of Carmax^®, it is clear that they started out slowly. Carmax^® is a public company which started out with one store in Richmond, VA in 1993. Those of you that have been around a while remember that it was not wildly successful at first.  The second Carmax^® store opened in 1994 and the media skeptics-including Automotive News-were predicting an early death for the brand.  It took four years for Carmax^® to equal the number of stores that signed up as AutoStar Superstores^® within the first year of operation.  Carmax^® persevered, made changes and improvements in their model and is thriving today. Of course they funded their expansion through public, rather than private capital, as they have always been a publically traded company unlike AutoStar National Dealer Network^®, which is a privately held company.

For those of us in the car business, we know that the success of Carmax^® is not due to their pricing.  Dealers can beat Carmax^® pricing any day of the week. As a dealer, I hated to be at the auction next to the Carmax^® buyers. Their hands knew of only one direction to go, and that was up!  But it’s hard to beat their marketing.  They have convinced the buying public that they are a easier and cheaper way to buy even though it is not always true. That is our golden opportunity at AutoStar National Dealer Network^®. We will become a dominant force by signing up additional dealers in 20110 and 2012.

Why didn’t more dealers sign up?  I have not been involved in the formation of a franchise in the past, but have owned several new car franchises.  Car dealers have been willing to risk signing up new franchises for new car dealerships. Remember when Hyundai^® was considered a risky or throw away franchise?  Our Chairman, George Lovato Jr., has been involved in the formation of several other franchises including Rent-Rite Car Rental Agency in the 1980′s (please see his biography on www.bhcapitalltd.com)  He tells me that every franchise starts out this way.  Even McDonald^®‘s had its share of skeptics and doubters who did not have the guts to sign up for one – even when the franchise only cost $12,500 to start.  Today it takes millions to become a franchisee.  AutoStar National Dealer Network^® has all the ingredients and the “secret sauce” to become a successful franchise too.

2010 Accomplishments

Positive things happened in 2010.  We eclipsed Carmax^® growth more than tenfold in comparing the first two years of both companies inceptions.  We signed a strategic partnership with Driven Brands^® to allow our dealers to open Meineke^® Auto Repair Centers and Maaco^® Paint and Body Shops in AutoStar Superstores, and to put AutoStar Superstores^® in the current and future Driven Brands^® Stores.  We also signed a major deal with one of the world’s largest real estate firms to put AutoStar Superstores^® and Driven BrandsV in over 100 empty dealership sites across the United States.  That means that a dealer or general manager with just $250,000 worth of working capital can open one of these empty dealerships and make the real estate play of a lifetime.

There is no doubt in my mind that AutoStar Superstores^® will grow into a powerful National Dealer Network of individually owned stores that will continue to increase in value like new car dealerships did for years.  Now is the time for you to get in on the ground floor. We have made it easier than ever to become a dealer and can provide you complete infrastructure and a turn-key operation.  Call me today at 877-265-5123 or email me at ken@autostarsuperstore.com.