Franchise Group, Inc. operates as an owner and operator of franchised and franchisable businesses that continually looks to grow its portfolio of brands. The company has a diversified and growing portfolio of highly recognized brands.
The company’s business segments include The Vitamin Shoppe (Vitamin Shoppe), Pet Supplies Plus, Badcock Home Furniture & more (Badcock), American Freight, Buddy’s Home Furnishings (Buddy’s), and Sylvan Learning (Sylvan). The company offers its brands a shared serv...
Franchise Group, Inc. operates as an owner and operator of franchised and franchisable businesses that continually looks to grow its portfolio of brands. The company has a diversified and growing portfolio of highly recognized brands.
The company’s business segments include The Vitamin Shoppe (Vitamin Shoppe), Pet Supplies Plus, Badcock Home Furniture & more (Badcock), American Freight, Buddy’s Home Furnishings (Buddy’s), and Sylvan Learning (Sylvan). The company offers its brands a shared services platform that allows it to drive economies of scale, efficiencies and best practices. The company’s platform enables its portfolio of brands to be stronger together than they are apart.
The company’s franchise and dealer programs are designed to promote consistency and it is selective in granting franchises and dealerships. The company focuses on partnering with franchisees and dealers who have the commitment, capability and capitalization to grow its brands.
While the specific terms of its franchise agreements vary among its brands, the company utilizes both store-level franchise and multi-unit development programs. Under both types of franchise programs, franchisees supply capital by purchasing or leasing the land, building, equipment, signs, inventory and supplies. Both store-level franchise and multi-unit development agreements typically require payment to the company of certain upfront fees, such as initial fees paid upon opening a store, fees paid to renew the term of the franchise agreement and fees paid in the event the franchise agreement is transferred to another franchisee. Franchisees also pay monthly royalties based on a percentage of their store sales and are required to spend a certain amount to advertise and promote the brand.
Additionally, the company’s Badcock segment offers dealership agreements, whereby a dealer is granted a non-exclusive license for use at designated premises to operate the dealership devoted exclusively to the sale of merchandise and other approved activities. There are no fees that are paid by the dealer for entering into a dealership agreement. However, the dealers are able to earn and may be entitled to receive a commission, as determined by Badcock, upon the sale of merchandise consigned by Badcock to the dealer.
The company seeks to maintain healthy relationships with its franchisees, dealers and their representatives. The company invests a significant amount of time working with the franchisee and dealer community on key aspects of the business, including products, equipment, operational improvements, standards and management techniques.
Brands
The company’s Vitamin Shoppe segment is an omnichannel specialty retailer and wellness lifestyle company with the mission of providing customers with the most trusted products, guidance and services to help them become their best selves, however they define it. Vitamin Shoppe offers one of the largest varieties of products among vitamin, mineral and supplement retailers. The broad product offering enables Vitamin Shoppe to provide the company’s customers with a depth of selection of products that may not be readily available at other specialty retailers or mass merchants, such as discount stores, supermarkets, drug stores and wholesale clubs. Vitamin Shoppe continues to focus on improving the customer experience through the roll-out of initiatives, including increasing customer engagement and personalization, enhancing the omnichannel experience (including in stores, online and on mobile devices), growing private brands and improving the effectiveness of pricing and promotions.
The company’s Pet Supplies Plus segment is a leading omnichannel retail chain and franchisor of pet supplies and services. Pet Supplies Plus has a diversified revenue model comprised of company-owned store revenue, franchise royalties and revenue generated by the wholesale distribution of products to its franchisees. Pet Supplies Plus offers a curated selection of premium brands, proprietary private label and specialty products with retail price parity with online competitors. Additionally, Pet Supplies Plus offers grooming, pet wash and other services in most of its locations. The company’s Pet Supplies Plus segment’s wholly-owned subsidiary Wag N’ Wash is an emerging grooming, pet-wash and natural pet food franchise. Wag N’ Wash is primarily focused on dogs, has a store footprint that is substantially smaller than a Pet Supplies Plus location and is operated by the Pet Supplies Plus management.
The company’s Badcock segment is a retailer of furniture, appliances, bedding, electronics, home office equipment, accessories and seasonal items in a showroom format. Additionally, Badcock offers multiple and flexible payment solutions and credit options through third parties and its consumer financing services. The company is in the process of moving its consumer financing services business to a third-party provider.
The company’s American Freight segment is a retail chain offering in-store and online access to furniture, mattresses, new and out-of-box home appliances and home accessories at discount prices. American Freight buys direct from manufacturers and sells direct in warehouse-style stores. By cutting out the middleman and keeping its overhead costs low, American Freight is well positioned to offer quality products at low prices. The company’s American Freight segment provides customers with multiple payment options, including third-party financing, providing access to high-quality products and brand name appliances that may otherwise remain aspirational to some of its customers.
American Freight also serves as a liquidation channel for major appliance vendors. American Freight operates specialty distribution centers that test out-of-box appliances before they are offered for sale to customers. Customers typically are covered by the original manufacturer’s warranty and are offered the opportunity to purchase a full suite of extended-service plans and services.
The company’s Buddy’s segment is a specialty retailer of high quality, name brand consumer electronic, residential furniture, appliances and household accessories through rent-to-own agreements. The rental transaction allows the company’s customers the opportunity to benefit from the use of high-quality products under flexible rental purchase agreements without long-term obligations.
The company’s Sylvan Learning segment is an established and growing franchisor of supplemental education for Pre-K-12 students and families. Sylvan addresses the full range of student needs with a broad variety of academic curriculums delivered in an omnichannel format. The Sylvan platform provides franchisees with the ability to provide a range of supplemental educational services, including on premises, virtually, at a satellite location and in the home.
Business Strategy
The company’s strategy is to focus on the operation and acquisition of franchise and franchisable businesses. The company strives to assemble a mix of businesses that provide it balance and overall economic resiliency, while also allowing it to benefit from the scale of a single franchising platform. As a multi-brand operator, the company continually looks to diversify and grow its portfolio of brands either through acquisition or organic brand development.
Regulation
The products and services offered by the company’s business segments are subject to federal laws and regulation by one or more federal agencies, including but not limited to the Food and Drug Administration (FDA), the Federal Trade Commission (FTC), the Consumer Financial Protection Bureau (CFPB), the United States Department of Agriculture and the Environmental Protection Agency.
History
The company was incorporated in Delaware in 2010. It was formerly known as JTH Holding, Inc. and changed its name to Liberty Tax, Inc. in 2014. Further, the company changed its name to Franchise Group, Inc. in 2019.
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