[copperpress-advertserve-ad-reload zone="3"]
ARCHIVED  October 8, 1999

Franchise business puts rentals on road

In 1958, when Jerry King got his start in the auto business, he didn’t apply for a loan from the bank. He bought one car at a time and expanded his business slowly.

“I saved my money, bought a car, sold it, and with that profit I’d buy another car,” King remembers.

Today, King lives several states away from his first car lot, and has expanded his auto business into an impressive enterprise that includes a franchise rental-car business and a used-car lot. While the no-loan approach worked for King, he is quick to concede that such a plan would be hard to implement today.

“In those days, you could buy a handful of cars for $20,000. It’s more difficult to get into business today,” he said.

But helping people get into the car business is exactly where King is focusing his energy these days. As the owner of Price King Rent-A-Car, King sells franchises across the country and expects to open his 25th franchise location in New Mexico soon.

With an eye on the future, the entrepreneur plans to relocate his franchise headquarters from Fort Collins to Holland, Mich., with expectations of building his franchise business from 25 locations to 100 franchises across the nation, within the next 10 years.

“The car business has been good to me,” King said. “I do what I do best.”

Born in Detroit, King grew up in Florida and says that his search for a cooler clime brought him to Colorado.

“I’ve had enough hot weather in my life,´ said King, who lived in Arizona for several years prior to moving to Colorado.

King opened the first Price King in Phoenix in 1990 but says he’s been around cars all his life.

He opened a Lincoln Mercury dealership in 1970, learned the ins and outs of the car business and shifted his focus to the rental business, before starting his own company.

“It’s been a long process of learning things, and it’s really a continual education,” he said. “You don’t learn this business overnight.”

In addition to the rental car franchises, King also owns King’s Auto Sales & Service Inc., a used-car lot on Mulberry Street in Fort Collins that sells a variety of cars, from Mercedes and Jeep to Honda and Hundai. Sticker prices range from $3,800 to $26,000, and King sells about 25 cars per month with a 90-day or 3,000-mile warranty.

Competing for these sales are all the businesses that sell, rent, or repair cars, King said. “And there’s a lot of competition out there.”

Statewide, 1,445 used-car lots are open for business, according to the Colorado Independent Automobile Dealers Association. In comparison, there are 359 wholesalers and 329 franchised or new car/truck dealers in the state. And those numbers have remained relatively steady over the past five years.

John Kramer, assistant general manager of Denver Auto Auction in Denver, finds King one car dealer he enjoys working with.

“He’s as fine as any dealer we do business with,” Kramer said. “He’s a man of his word and has a high standard of integrity.”

Kramer sees King about once a week for the auctions his company hosts. Dealing with cars from manufacturers, rental car companies, banks, and dealers, Kramer has had a lot of exposure to the business and its professionals.

In any business, there are going to be companies that represent the high and low ends of the spectrum, he said. “King represents the high end.”

King, who began franchising his rental-car locations in 1995, focuses on local business instead of going head to head with national rental car companies such as Enterprise and Alamo. However, he is confident that when it comes down to price, Price King would beat out all competitors.

“We can beat all of their prices,” he said. “We don’t have anywhere near their operating expenses, so we can keep our prices low.”

While they don’t compete on the national level, Price King Rent-A-Car locations around the country keep busy servicing local clientele.

“There are a lot of reasons why people need a car,” King said, and he’s capitalized on several. King operates four Price King Rent-A-Car locations in Fort Collins, Loveland, Boulder and Breckenridge, and has sold franchises in Wyoming, Arizona, Kentucky, Texas and Florida.

“We believe in heavy [trade] advertising,” he said.

Although his ads are designed to pique the interest of all businesses interested in offering rental cars, King targets car dealers because, he said, they have no additional overhead costs.

“They have everything they need,” he said. “It’s economical.”

King estimates that a rental location should have a 10-by-15-foot space designated for a counter and a lot large enough to accommodate 15 cars, if the dealer plans to carry 30 or 40 cars. “You only need space for about one-third of your cars,” because the rest of them should be out on the road, King explained.

Aside from space allocation, companies interested in investing in a franchise need little else, King said. “We travel to wherever they are and train them,” he said.

King’s son, David, general manager for the business, explained that a franchise sale, which ranges in cost from $3,900 to $5,900 depending on population size, includes information about the process, procedure, rights to the King name, legal assistance and sharing years of industry knowledge.

“The minute we open up a location it seems to do well,´ said King, who admits that selling franchises is not easy. “They don’t sell like hotcakes, but each year it seems to get a little easier.”

One reason Price King has become an easier sale is that the company has established itself as a long-term industry player, King said.

“People want to know that you’re going to be around,” he said.

In terms of future plans, King is open to new territories for franchises and welcomes interest from all over the country.

“Wherever they call us from, we’ll come running,” he said.

In 1958, when Jerry King got his start in the auto business, he didn’t apply for a loan from the bank. He bought one car at a time and expanded his business slowly.

“I saved my money, bought a car, sold it, and with that profit I’d buy another car,” King remembers.

Today, King lives several states away from his first car lot, and has expanded his auto business into an impressive enterprise that includes a franchise rental-car business and a used-car lot. While the no-loan approach worked for King, he is quick to concede that such a plan would be hard…

[copperpress-advertserve-ad-reload zone="3"]

Related Content

[copperpress-advertserve-ad-interstitial zone="30"]