Christian Brothers: a Profitable Franchise with a 5Yrs Payback
Founded in 1982, Christian Brothers Automotive hasn’t stopped growing over the past few years to become one of the most famous car servicing franchise. At 265 locations in the US today, of which all are franchised-owned, Christian Brothers had added 150+ shops in the last 10 years alone..!
We think there’s a good reason for such a hype: Christian Brothers has one of the best payback in the car servicing franchise industry. Indeed, it’s not only a very profitable business, but its cost is also rather affordable ($582,000 initial investment).
In this article we are looking in-depth at Christian Brothers Automotive and its Franchise Disclosure Document to find out all you should know about that franchise: how much it really costs, and how profitable it really is. Let’s dive in!
Key stats
| Franchise fee | $135,000 |
| Royalty fee | 50% of profit |
| Marketing fee | 5.00% |
| Investment (mid-point) | $583,000 |
| Average sales | $2,466,000 |
| Sales to investment ratio | - |
| Minimum net worth | $250,000 |
| Minimum liquid capital | $85,000 |
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 | Christian Brothers Automotive |
| FRANCHISE FEE | $135,000 |
| ROYALTY FEE | 50% of profit |
| INITIAL INVESTMENT | $520,000 – $645,000 |
| AVERAGE REVENUE | $2,466,000 |
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What is Christian Brothers Automotive?
Christian Brothers Automotive is an American full-service auto repair franchise based in Houston, Texas.
The chain was founded in 1982 by Mark Carr. It operates vehicle service centers, offering services such as AC services, brakes, oil and filter changes, scheduled maintenance and tune-ups.
Christian Brothers Automotive began franchising in 1996 and currently has over 250 locations in the US.
Christian Brothers Automotive franchises pros and cons
The Pros:
- Financial assistance: Christian Brothers Automotive provides its franchisees with in-house financing for their franchise fee, startup costs and equipment. In addition, it has relationships with third-party financiers for equipment, inventory and payroll.
- Site selection and construction: Christian Brothers Automotive helps its franchisees with the site selection and construction of their repair centers and helps them focus on their investments.
- Pre-opening training: The franchisor has a detailed online and classroom training program for its franchisees to learn about its systems, customer service and launching of their centers. Also, franchisees get ongoing hands-on training on the latest technology and best practices.
- Marketing and advertising: Christian Brothers Automotive provides its franchisees with stellar marketing tools and techniques so that they can attract customers and drive sales. These include ad templates, web development, national media, regional advertising, social media and email marketing.
- Nice difference: Christian Brothers Automotive is rooted in the principle of “Love your neighbor as yourself” and strives to offer their customers an exceptional experience through the nice difference mission, which includes a three-year/36,000-mile warranty, complimentary guest pick-up and drop-off and a free courtesy check with every repair, including oil changes.
- Balanced work model: The franchisor’s schedule does not require franchisees to open on weekends. This gives franchisees a good work-family balance and time for family and friends to work on their businesses.
- Exclusive territory protection: The franchisor allows its franchisees to operate in an exclusive geographic area. It does not establish any other franchises or operate competitive channels in the designated area.
- Robust ongoing support: The franchisor offers its franchisees extensive and professional continuous support to establish and grow their franchises through meetings and conventions, security and safety procedures, periodic reviews and a franchisee intranet platform.
The Cons:
- Not a passive investment opportunity: The Christian Brothers Automotive franchise does not allow for absentee ownership. It requires franchisees to be fully active in the operations and management of their franchises.
- Not a home-based opportunity: The franchise cannot be operated from home or a vehicle. It requires franchisees to have a fixed office space, warehouse or retail facility.
- Not a part-time business: The franchise cannot be operated as a part-time or as a side business.
- Competition from other car servicing franchises such as Midas, Meineke and Jiffy Lube to name a few
How much does a Christian Brothers Automotive franchise cost?
Opening a new Christian Brothers Automotive franchise requires an initial investment of $582,000 on average, including a franchise fee of $135,000.
This investment is also lower than the average investment required for automotive franchises, which is around $1,000,000.
However, note that the investment amount can vary based on several factors such as location, size, and other considerations. The latest Franchise Disclosure Document shows that the investment range for Christian Brothers Automotive is between $520,000 and $645,000.
Startup costs
The investment covers all the startup costs needed to start an auto repair service franchise. You must pay the franchisor an initial franchise fee of $135,000.
You will pay a down payment of $85,000 as the first installment and the rest when you sign the agreement. In addition to this franchise fee, the investment also covers:
- Formation Costs: real state and leasehold improvements, equipment, training expenses, construction, shuttle vehicle, computer system, signs, business license, etc.
- Initial Marketing: new store opening advertising, marketing supplies
- Operating Costs: initial inventory, insurance, first 3 months working capital, etc.
| Type of Expenditure | Low | High |
|---|---|---|
| Initial Franchise Fee | $135,000 | $135,000 |
| Formation Costs | $304,250 | $363,400 |
| Initial Marketing | $35,000 | $50,000 |
| Operating Costs | $46,000 | $97,000 |
| Total | $520,250 | $645,400 |
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| Christian Brothers Automotive |
| FRANCHISE FEE | $135,000 |
| ROYALTY FEE | 50% of profit |
| INITIAL INVESTMENT | $520,000 – $645,000 |
| AVERAGE REVENUE | $2,466,000 |
What is the AUV of a Christian Brothers Automotive franchise?
On average, a Christian Brothers Automotive franchise had an Average Unit Volume (AUV) of $2,466,202 in 2022 (vs. $2,097,000in 2021).
The AUV varies significantly from one centre to another: in 2021 the lowest AUV was $1.25 million yet the highest over $5.6 million. Here’s the breakdown of the 231 franchises by AUV in 2022:
| AUV (median) | Number of shops | |
|---|---|---|
| > $3.5M | 4,002,729 | 21 |
| $3M – $3.5M | 3,091,895 | 23 |
| $2.5M – $3M | 2,721,585 | 66 |
| $2.25M – $2.5M | 2,372,494 | 36 |
| $2M – $2.25M | 2,120,753 | 35 |
| $1.75M – $2M | 1,915,452 | 33 |
| $1.5M – $1.75M | 1,597,509 | 9 |
| $1.25M – $1.5M | 1,410,736 | 7 |
| $1M – $1.25M | 1,248,802 | 1 |
| < $1M | 0 | 0 |
How profitable is a Christian Brothers Automotive franchise?
On average, a Christian Brothers Automotive franchise makes $325,000 in profits per year. That’s a 16% EBITDA margin, before amortization, taxes and any other non-operating expenses.
As per our benchmarks for car servicing franchises, Christian Brothers Automotive is indeed a very profitable business: the 16% EBITDA margin is higher than the average for the industry (~10-15% EBITDA margin).
| Profit and loss | Amount | % revenue | Source |
|---|---|---|---|
| Revenue | $2,097,064 | 100% | as per FDD |
| COGS | $(891,252) | 43% | as per FDD |
| Gross Profit | $1,205,812 | 58% | as per FDD |
| General & Administrative Expenses | $(775,914) | 37% | as per FDD |
| Royalties | $(104,853) | 5%* | as per FDD* |
| EBITDA | $325,045 | 16% | as per FDD |
Source: Franchise Disclosure Document 2022
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| Christian Brothers Automotive |
| FRANCHISE FEE | $135,000 |
| ROYALTY FEE | 50% of profit |
| INITIAL INVESTMENT | $520,000 – $645,000 |
| AVERAGE REVENUE | $2,466,000 |
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