Aaron Rents acquires La.-based Easy Way chain
By Clint Engel -- Furniture Today, June 13, 2004
Atlanta — Aaron Rents has acquired the 27-store Easy Way rent-to-own chain based in Delhi, La., giving it several new Southern markets.
Aaron acquired the business, including the lease on a 36,000-square-foot warehouse, from industry veteran Jimmy Strong for an undisclosed amount. Strong, 60, is retiring.
Most Easy Way stores are in Louisiana, with four in Mississippi and three in Arkansas. Aaron will close six of the 27 stores, consolidating the accounts into nearby Aaron's Sales & Lease Ownership stores, said Aaron Rents Chairman Charlie Loudermilk. It will convert the remaining 21 units to Aaron's stores fairly quickly, he said.
"We've been saying we'll open about 150 (stores this year), but it look like we're going to be closer to 200 stores," he said.
At the end of the first quarter, Aaron had nearly 900 stores, including company-owned and franchised units, in the United States, Puerto Rico and Canada. System-wide revenues, including franchisees, topped $1 billion last year.
The Easy Way stores average about $30,000 in revenue per month, compared with Aaron's $90,000 average, and "have a long way to go," Loudermilk said.
Some of the stores, which average about 6,000 square feet, eventually will be relocated to larger spaces. In the meantime, Aaron's has other ways of growing the business, Loudermilk said, including better pricing, converting customers from weekly to semi-monthly and monthly payments, and rebranding and advertising under Aaron's, a name Loudermilk said is well-recognized nationally now, in part because of the company's sponsorship involvement in NASCAR.
Separately, Aaron's has completed the conversion of its remaining Sight & Sound stores to Aaron's Sales & Lease Ownership stores, ending an experiment in expanding through pure retail acquisition — one Loudermilk said the company won't repeat any time soon.
When Aaron purchased the then 26-store Oklahoma City-based Sight & Sound in 2002, it was a test to see if it could acquire a traditional retailer and expand it by adding RTO financing plan options. The idea was that such options would serve the 35% to 40% of consumers who are typically turned down for credit by pure retailers.
Loudermilk said the concept is still valid, but Sight & Sound employees had a difficult time with it. Also, Sight & Sound was a money-loser going into the deal, had customer service issues, and had more operational problems than Aaron first realized.
Aaron chose Sight & Sound as the test candidate because it was cheap, and "we got what we paid for," Loudermilk said.
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