FIXER UPPERS: No auto-service business paints, washes, repairs or changes the oil for as many vehicles as Charlotte's Driven Brands.

• Author: Reed, Ted

The Take 5 Oil Change at the corner of Tyvola Road and South Boulevard in south Charlotte stays busy, averaging 80 oil changes a day and annual revenue of $2.3 million. But this shop does more than its name implies: Charlotte-based Driven Brands uses the site to annually train about 200 managers, key cogs in a business with 4,400 locations. It's part of the largest U.S. auto-service company's strategy to create a fast-growth Wall Street darling by packaging thousands of small auto-service businesses into popular national brands.

Driven is a public company, though it's controlled by 70% owner Roark Capital, an Atlanta private-equity group that specializes in backing franchise businesses, such as Arby's, Dunkin', Massage Envy, Anytime Fitness and dozens of other retailers. Roark has its fingers on 66,000 locations. By comparison, there are about 40,000 McDonald's globally.

On a recent morning, Tyler Cagle, the company's director of franchise operations, was instructing a dozen trainees from several states. He started with Take 5 Oil Change nine years ago as a store manager in Charlotte, before Driven bought the New Orleans-based chain in 2016 for an undisclosed price.

Franchise owners pick 200 trainees annually to visit Charlotte for a couple of weeks for training, while another 400 employees get online management training. The pitch is simple, he says. "You can go from pit technician to president [at Driven.]"

Cagle cites Russell Benthal, who started as a technician in 2018 and was promoted earlier this year to director of operations for franchise partners in the Triangle, the Triad and Richmond, Virginia. Or there's Forrest Snider, who started as a technician in New Orleans and is now associate vice president of operations for the Southeast.

Driven grows by acquiring smaller, typically family-owned companies in its three core businesses of oil change, auto wash and auto glass. Then it folds them into existing brands and attracts franchisees who pay a percentage of annual revenue in return for marketing, training and other corporate support. About 60% of its 4,400 outlets in the U.S. and 14 other nations are franchises.

"We're sharing with Wall Street the fantastic unit-level economics of our three primary growth businesses," says Tiffany Mason, the company's chief financial officer and top Charlotte executive. She's referring to vehicle maintenance, car wash and paint, collision, and glass. "Simple, convenient and fast (is) the operating model. It resonates with consumers, which means great throughput, which equals profitability."

The auto-services industry is massive and fragmented. "Eighty percent of it is small chains and independents facing tough economic times and supply-chain pressure," Mason says. "This is where scale really matters. Small independents don't have flexibility, alternative supply-chain, consumer research, or the size and scales of Driven Brands. That's a little bit of the upper hand we have."

The company's revenue tripled over the past three years to nearly $1.5 billion, while systemwide sales gained 4% to $4.5 billion. Driven opened a net 247 stores last year after adding more than 1,600 through expansions and acquisitions during the two previous years. Plans...