Kwik Fit has agreed a 10-year franchise agreement with CDG-ONE in Italy and is “exploring the potential for further franchise networks throughout the EU, with a particular focus on Central Eastern and Southern Europe”
Tyre retailer to open 200 service centres in franchise move
The Kwik Fit Group has agreed a partnership deal that sees the Kwik Fit tyre retail and fast-fit brand expand into Italy. Under the terms of the agreement, 200 centres are set to open over the next decade.
The expansion is based on a franchise agreement with CDG-ONE, part of Segema S.p.A., a leading tyre distribution group in Italy. Segema imports and distributes Yokohama tyres in Italy through Yokohama Italia S.p.A. and GiTi Tyres through Magri Gomme S.p.A.
CDG-ONE plans to build a network of more than 200 centres under the Kwik Fit brand by 2026. It is inviting existing independent tyre dealers and garages who meet the criteria to join the network and convert their operations to become Kwik Fit branded centres.
CDG ONE was founded in 2010 by Segema Group in order to develop its dealer network. The main goal is to increase the loyalty of trade customers, and support the service to any type of end user, while increasing the penetration of Yokohama and GT Radial brands on the market. CDG-ONE reports that it provides a range of services and provides customers with support while allowing them to operate independently – dealers are able to offer multiple brands, according to their own commercial requirements. Fully operational since early 2011, CDG-ONE now covers over 800 affiliated outlets, evenly spread throughout the country and serving private customer, long-term rental companies and corporate fleets.
Moving forward, CDG-ONE will oversee the management and operation of all the service centres in Italy. Kwik Fit will provide access to training, including use of its UK training academies, and support in areas including operational procedures, marketing and technology. The two companies will also work together to ensure that the enlarged network can take advantage of the additional purchasing power its scale brings.
According to the company, Kwik Fit centres in Italy will look like and operate on the same principles as those in the UK. There is scope for different formats within the agreement, from centres offering just tyre replacement and wheel alignment services to the full range of services provided by UK centres, such as servicing, brake replacement and air conditioning. Customers of the network in Italy will also benefit from the Kwik Fit European Guarantee – any work carried out by a Kwik Fit in one European country is automatically guaranteed in any Kwik Fit across Europe.
Franchise expansion strategy
In addition to its large UK operation (numbering 662 Kwik Fit branded outlets and 770 across all the firm’s tyre retail brands), Kwik Fit currently owns and operates more than 180 Kwik Fit service centres in the Netherlands. Moving further afield, Kwik Fit has opted to expand via franchise agreements – an approach that began at least six years ago with the signing of largescale franchise in Russia, prior to current owner Itochu’s purchase of Kwik Fit in 2011.
In answer to Tyres & Accessories questions relating to Kwik Fit’s presence in Russia, a company representative explained: “The majority of the Kwik Fit Group’s previous franchise activity was operated under the control of Speedy, the Paris-based company which was part of the Group until 2011. When Speedy was sold by Kwik Fit after its acquisition by Itochu, any franchise agreement either ended or remained with Speedy and its new owners. Similarly, Kwik Fit’s 2010 agreement with the ROLF Group in Russia ended when Itochu acquired the Kwik Fit Group. By mutual decision the “White Service” centres operating under that agreement were transferred to a management team from the ROLF group. Kwik Fit no longer had any connection with those franchises.”
Presently the company runs a franchise agreement in Hungary and Kwik Fit says it is also “exploring the potential for further franchise networks throughout the EU, with a particular focus on Central Eastern and Southern Europe”. In Hungary 11 service centres operating under the Kwik Fit brand are run by a Hungarian franchisee under an agreement established in 2011..
Unlike Kwik Fit’s operations in the UK and the Netherlands where all the centres are company-owned with no franchising, the Italian centres will all be franchises. Under the agreement, CDG-ONE has a license to exclusively operate the Kwik Fit brand and concept in Italy for at least 10 years.
Kenji Murai, chief executive of Kwik Fit, said: “This partnership is a significant step in further developing Kwik Fit outside the UK as we believe the Italian market holds great potential for our brand. CDG-ONE is a proven expert in the automotive aftermarket sector in Italy and is well respected as a successful operator. It is the ideal partner for us as it develops a retail presence in the Italian market. We are confident that CDG-ONE will deliver the Kwik Fit network in Italy enabling Italian motorists to benefit from the fast, efficient and value for money service that customers in the UK, the Netherlands and Hungary already know.”
Riccardo Magri, president of CDG-ONE and Yokohama Italia, said: “We are looking forward to working with Kwik Fit to develop a new customer focussed aftermarket repair network in Italy. We believe that our expertise and local knowledge of the Italian market, combined with Kwik Fit’s operating model and support will enable us to develop a unique network that our partners and customers will benefit from. This is an exciting opportunity to bring a leading brand to the Italian market that will provide customers with the best possible care for their car, offering value for money, reliability and fast efficient service.”