Growth for oil change chains will be especially healthy as the younger generation of drivers show less interest in changing their own oil than previous generations and are more than happy to pay for this service as long as it is convenient and speedy. As an essential service during COVID-19 closures, oil change shops were already well equipped for social-distancing with contactless drive-thru procedures that allow customers to stay in their cars.
While the oil change industry as a whole has seen an uptick in expansion, expect much of their franchise growth to target the South, Southeast and Southwest for new construction, as well as acquisitions. Look for Jiffy Lube, Valvoline, Take 5 Oil Change, Express Oil Change, Grease Monkey and SpeeDee Oil Change & Auto Service to all make their mark on the retail landscape with new locations.
Jiffy Lube expects to add stores in western Arkansas and South Carolina, while increasing its footprint in the Midwest, targeting Kentucky, Nebraska, Utah and Wisconsin. It aims to open up to 50 new units per year until the end of 2023. The 2,000-unit chain began expanding into the South through acquisitions, namely its purchase of eight Havoline Xpress stores in Mississippi and Louisiana and its purchase of a Mobil 1 Express Lube in Alabama. Jiffy Lube will use its “Multicare” design for all new construction. Introduced two years ago, this 4,000-s.f. layout includes four service bays with service pits. The Multicare moniker ties into the offering of additional services beyond oil changes, such as brake repair, engine diagnostics, fuel system cleaning and tire service. Jiffy Lube looks for locations that do not have a competing oil change shop within a three-mile radius and a minimum population of 50,000 people with a median income of $50K within the same area. Jiffy Lube also looks for 42,000 registered vehicles within that three-mile radius and a daily traffic count of at least 20,000 cars near any site.
Valvoline anticipates opening 80-plus units each year over the next two years. This will entail both new construction and acquisitions. It will specifically focus on states where its presence is under-developed, including markets in the Northwest and West, such as Nevada, Idaho, Utah, Wyoming and North Dakota. Expect Valvoline to also target Delaware, West Virginia, Vermont, Arkansas, Georgia, Tennessee and Alabama. The chain’s prototypical 2,100-s.f. shop goes on to a standalone pad of about 0.5 acres. This small footprint allows Valvoline to accommodate irregularly shaped lots and its flexible floorplan can adapt to local design requirements without obstructing the view from the street of anchor tenants. Valvoline seeks out trade areas that have over 20,000 households within three miles. Valvoline has adopted a stay-in-your car drive-thru service model that allows customers to avoid waiting rooms for contactless oil changes at its 1,400 shops.
Take 5 Oil Change plans to open 100 new locations during each year for the next three years. It is interested in finding new franchisees in the Midwest, especially Arizona, Idaho, Colorado, Minnesota, Kansas and Nebraska, as well as expanding its reach in Texas, Kansas, Arkansas, Iowa, Indiana and Illinois. During February, the Driven Brands subsidiary acquired and converted a Penzoil 10 Minute Lube shop in South Houston, as well as a Chevron Fast Lube in Ruston, La., during January. Last year Take 5 purchased 48 SuperLube units in Florida, Wisconsin, Indiana, Illinois and Alabama. Take 5 prefers a 1/3-acre pad and a 1,500-s.f. building and can configure a shop with two or three bays. The 550-unit chain looks for demographics that offer 30,000 residents within three miles, a median household income greater than $50K, and a daily traffic count of more than 30,000 vehicles. Take 5’s smaller pad requirement allows Take 5 greater flexibility when it comes to potential sites.
Express Oil Change will want sites to help expand its presence throughout the Midwest, as well as grow into Arizona, Arkansas, Kansas, Illinois, Indiana, Iowa, Missouri, Nevada, Ohio, Texas, Utah, Virginia, West Virginia and Wisconsin. The chain seeks locations in high-end shopping centers where future community growth is expected, requiring a parcel offering 20,000 to 35,000 s.f. Any potential site should have strong ingress and egress and be in close proximity to retail draws such as grocery stores or big-box retailers such as Target or Lowe’s. It prefers demographics that include middle-to high-income consumers. Known for its Signature 10-minute oil change, Express Oil also provides tire service and maintenance. Express Oil Change has 274 stores in 16 states.
Grease Monkey will seek pad sites of 20,000 s.f. for the 30 new units it expects to open during each of the two to three years. The 226-shop chain looks to enter new markets nationwide, with an immediate emphasis on Northern California, upstate New York, Louisiana, Texas, Arkansas and Kentucky. Its standard three-bay format requires a building of 2,272 s.f., including service pits. Grease Monkey will consider smaller sites with adjoining common space.
It will consider new construction for standalone units, but prefers conversions, especially if it entails a side-by-side conversion of an existing carwash for its Monkey Shine carwash concept, which franchisees can add for no additional fee. The carwash can use one bay or a tunnel to 100 feet long.
SpeeDee Oil Change will be more cautious with its expansion, hoping to add eight to 10 new units during each of the next two years in California, Texas, the Mid-Atlantic and New England states. It expects to open four new units this year. It looks for 50,000-s.f. parcels and uses a typical building size of about 3,100 s.f., with four service bays. SpeeDee provides automotive services including tune ups, brake work, maintenance and repairs in addition to oil changes. Franchisee Full Speed Automotive operates 94 SpeeDee units, as well as locations under the Grease Monkey banner. During early 2020, Full Speed Automotive took ownership of the American LubeFast brand and its 50 locations in the Southeast. Sixty-three SpeeDee units are co-branded with and owned/operated by Midas.
