Creative Colors International

Dec 3, 2009

As it turns out, both the company and the industry as a whole have seen huge growth and plenty of changes during the past quarter-century.

For starters, the two-person company that began by learning how to dye vinyl has grown into a nearly full-service interior repair and restoration operation, offering services for automobile seats, dashboards, door panels and headliners, including work on vinyl, leather, fabric, carpeting and hard plastics. Technicians also do re-dyeing and color-changing, refurbish convertible tops and vinyl roofs and perform minor work on plastic and urethane bumpers.

As always, these services are performed at dealers’ lots and retail customers’ homes and offices by the company’s mobile units-a fleet of more than 150 white minivans operating across 24 states and a number of Canadian provinces, all striped and lettered with the company’s colorful logo.

The Fosters long since changed the name and business model. The company, now known as Creative Colors International and operating out of a new facility in Mokena, Ill., has morphed itself into a successful franchisor as well.

The company now boasts 68 CCI franchises nationwide, each operating a varying number of white vans in their own protected areas, in addition to the 18 mobile units still operated out of the corporate-owned store in the Chicago area, according to Mark J. Bollman, CCI president and COO.

Though founder JoAnn Foster retired in 2000, the family is still involved with running the operations to ensure the franchise stays true to its original concept. The company’s principals include daughters Terri Sniegolski [senior vice president and CEO] and Kelli Bollman [CFO, accounting director and training director].

“We try to keep the family relationship in perspective with the business relationship,” Mark Bollman says. “We try to run the business like a business and have family time be family time.”

A New Growth Plan

CCI and its principals have been maintaining that delicate balance since the beginning.

The company’s original incarnation, J&J’s, continued to add employees and clients until 1991, when the Fosters decided to franchise their business under the name Creative Colors International. Their intention was to offer people the same opportunity they had to run a successful business.

For years after deciding to franchise, the company chose a slow growth approach to expanding its business, adding an average of two to four new franchises each year.

In the past year, however, CCI has accelerated that rate of growth considerably.

In November of 2005, the company moved its corporate headquarters into a new, 10,000-square-foot facility, replete with private offices, a training center and additional warehouse space.

The company also added key personnel to facilitate a faster rate of growth, including a field support manager for technical repair aspects; a field operations manager that analyzes P&Os, business management and business planning; a full-time person to sell franchises; and an assistant trainer, says Bollman.

“[Slow growth] was our approach basically until November of last year, when we relocated into our new facility and added people to our staff,” he says. “All of those positions were needed to accommodate the growth we wanted to see in the future.”

And the results are already proving those moves to be wise decisions-the company had inked five deals by the end of February 2006, with three more projected by the end of April and a goal of adding a total of 24 new locations by the end of the year.

“Before, we just didn’t have the facilities,” he says. “Now, we’re ready to unleash.”

New Markets, New Business

The company’s growth over the years has been largely, but not completely, related to the used car industry. About 80 percent of the company’s and its franchise locations’ automotive accounts are with commercial dealers, body shops, insurance companies, fleet groups, rental car agencies and auctions, and the other 20 percent are retail customers looking to repair their own cars.

Bollman says he’d like to see the company garner more retail customers, but concedes that retail work is a tougher sell than wholesale jobs.

“We’re pushing to get more of the retail work with the end-consumer, but that’s a hard market to penetrate,” he says. “But that’s something we’re working on now.”

He says CCI is doing more direct mailings at the local consumer level, based on demographic information. That often takes the form of a direct mail program targeting drivers whose leases are coming due and may need cosmetic repairs.

The company also advertises in market-specific flyers, through events at local chambers of commerce and with the service departments at local dealerships, placing brochures and flyers in their waiting areas.

“It’s different than dealing with [business] customers,” Bollman notes. “You really need to keep yourself in front of the retail consumer to have them remember you.”

In addition to the work CCI does in terms of advertising in local markets, the corporate headquarters also spends considerable effort securing large, national corporate accounts, including rent-a-car agencies like Alamo, Dollar, Hertz, Avis and National.

These accounts or agreements don’t necessarily guarantee that the Hertz in Denver is always going to use a CCI tech, due to the fact that many such decisions are made at the local level. But it helps, says Bollman.

“We’re trying to get in from the top down and our franchisees are coming from the bottom up,” he says. “Eventually we’re hoping to meet in the middle. That just takes time, and we’re working on it.

“Overall, we want to be able to take all the red tape out of the way, so our franchisees are able to just go out and make money,” he adds. “That makes it a little more favorable for them, too, because not everyone is a great salesperson.”

Training is the Foundation

Since CCI’s technicians perform repairs on-site, customer service and professionalism are musts, Bollman says. For that reason, CCI puts its potential franchisees through an intensive initial screening process and a thorough four-week introductory training.

“We give them three weeks of hands-on technical repair training, both in the classroom and in the field on the job,” he says. “It also includes management, marketing and behind-the-scenes information as well.”

The company then offers extensive business support to get franchisees on their feet during their first year in business, he says.

“We go out in their territory for one week at the time of their grand opening and help them solicit and establish new accounts,” he adds. “We work with them side-by-side to make sure they are comfortable with all the repair processes.”

After that first week, franchisees then service their customers on a weekly basis, determined by a schedule set by the corporate office, which also provides phone support and a private Internet system to answer any questions that may arise in those crucial first weeks.

Trainers and support staff then visit new franchisees three to four more times during that first year, all of which is part of the company’s philosophy of creating stable, successful franchise locations.

“Our motto and philosophy is to put as much effort and time into a new franchisee as possible to make them successful, because we’ll be successful too in the long run,” says Bollman. “What makes CCI unique is the investment made into the franchisee. Instead of limiting our support to the first visit, we take the money initially invested as franchise fees and re-invest it back into their business. That way, when the franchisee becomes successful, we too will be just as successful on our return on investment in the long run.”

All things considered, that philosophy has served CCI well in recent years, allowing the company to capitalize on growing demand for mobile services in general, says Bollman.

“The trend [toward mobile services] is alive and well,” he says. “More people are choosing to go mobile or do a combination of mobile and storefront. That won’t ever go away.

“For the dealer, a service like this can be very valuable,” he adds. “They don’t lose the sales time by having to take a vehicle off the lot to a traditional upholsterer or trim shop. We fix it on-site, and will be in and out in less than half an hour, without them ever losing the ability to sell that vehicle.”

And Bollman says CCI, as a franchisor, has benefited from a relatively tough economic time over the past few years.

“There are a lot of people getting laid off from corporate jobs, and people want to go into business for themselves,” he says. “This is one way to do that without a lot of capital. It’s a home-based mobile business, and customer service is just as important as it was five years ago, and it always will be.”

Looking to the Future

Bollman says CCI plans to continue its expansion into markets outside of the automotive restoration and repair industries, including individual and commercial furniture repair, the airline industry and RV repair and restoration, among others.

The company’s forte today is primarily related to the automotive field-in the range of 95 percent of its overall business-but by tapping into these other markets, Bollman says CCI can better maximize the potential of each of its franchise locations and a handful of corporate-run stores.

“Every territory we’ve granted has been based off of 50 new car dealerships,” he says. “Within that area, we’d always project that they could add four trucks to service that quadrant. Assuming we’ve captured 70-80 percent market share-which is fair for us to say-”then we could have another two to three vans on the commercial/restaurant end, another two to three on the furniture end. Now, realistically, every franchise territory we envision to be at least 10 trucks after their 10-year period.”

By entering these non-automotive markets, CCI hopes to fulfill its overall mission.

“We want to be the household name in reconditioning, and we will achieve that goal,” he says. “And we’ll do that by adding additional franchises, 24 new ones this year. By 2010, we want to have 200 franchises.”

If the company sticks to the principles it has established thus far-professionalism, quality of service, and reinvesting in its franchisees, foremost among them-there is little doubt that those goals will be met, and soon.