Mighty Auto Parts Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$247,500 - $570,600
Franchise Fee
$17,500
Min Cash Required
$123,750
Total US Locations
92
Business Summary
Mighty Auto Parts operates a business within a designated territory that focuses on the wholesale distribution of automotive replacement parts, supplies, chemicals, lubricants, and other maintenance products. Mighty Auto Parts franchisees carry inventory in a warehouse facility and distribute these products to a customer base that includes professional automotive repair and maintenance facilities such as tire stores, quick lube centers, brake shops, automobile dealerships, fleets, service stations, and garages. The business model emphasizes proactive route sales and service, where salespeople build rapport with customers, provide inventory control, process re-orders, and offer training and technical product information.
Corporate History
The business concept for Mighty Auto Parts began in 1963 when Dallas F. Wallace started selling tire supplies. The company, operating under the name Mighty of Delaware, Inc., began granting franchises in 1970. Over the years, the company underwent several corporate changes and mergers, eventually becoming Mighty Distributing System of America, Inc. in 1996. MDSA, LLC was organized as a wholly-owned subsidiary in 1999 to hold the operating assets and intellectual property of the franchised business. In 2009, Gonher North America, Inc. acquired MDSA, LLC, which continues to operate as Mighty Auto Parts.
Financial Overview
Investment Range
$247,500 - $570,600
Franchise Fee (Low)
$17,500
Franchise Fee (High)
$82,500
Minimum Cash Required
$123,750
Royalty %
5%
Marketing %
0.5%
Equipment Costs (Low)
$67,500
Equipment Costs (High)
$187,000
Working Capital
$75,000
Audited Financials
Yes
Offers Financing
Yes
Audit Opinion
Unqualified opinion
Financial Health Notes
Mighty Auto Parts' audited financial statements show an unqualified opinion from its independent auditors, indicating that the financial statements present fairly, in all material respects, the company's financial position and cash flows. The company's net income increased from $248,054 in 2023 to $596,599 in 2024. Mighty Auto Parts significantly reduced its line of credit borrowings from approximately $3.5 million in 2023 to $655,206 in 2024. While there was a past non-compliance with a financial covenant in 2023, it was subsequently waived by the financial institution.
Financing Details
Mighty Auto Parts offers limited direct financing to its franchisees. While it generally does not make financing arrangements, it does provide a designated line of credit that franchisees can use to purchase Mighty products from the franchisor and approved suppliers. Franchisees also have the option to extend payments for their initial inventory across three equal installments, due in 30, 60, and 90 days. Additionally, a prompt payment discount of 0.5% may be earned on amounts paid by the 10th day of the month following the statement date. The franchisor maintains a security interest in the franchisee's inventory and accounts receivable to secure these credit exposures.
Performance Metrics
Total US Locations
92
Franchised Units
90
Corporate Units
2
Avg Square Footage
5,000
Franchising Since
1970
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
Mighty Auto Parts has no litigation to report in Item 3 of the FDD.
Bankruptcy History
Mighty Auto Parts has no bankruptcy history to report in Item 4 of the FDD.
Agreement Terms
Initial Term
10 years
Renewal Term
5 years
Renewal Conditions
To renew their Mighty Auto Parts franchise, franchisees must provide written notice of their request for renewal 60 to 120 days before the current agreement ends. They also need to submit a business plan and succession plan for approval. All monetary and other outstanding obligations to the franchisor, its affiliates, and approved suppliers must be fully satisfied, and the franchisee must have substantially complied with all terms of the agreements. Additionally, franchisees must sign a general release of claims against the franchisor, execute the then-current franchise agreement (without paying an initial franchise fee), comply with current qualification and training requirements, and pay a renewal fee ranging from $2,500 to $7,500 depending on the registered vehicles in the territory.
Training & Support Program
Franchisor Assistance
Mighty Auto Parts provides substantial assistance to its franchisees, starting before the business opens. This includes designating the franchise territory, providing access to operations manuals and buying guides, and offering 5 to 10 days of initial training that covers classroom business and sales, as well as field sales and operations training. The franchisor also offers pre-opening support for initial operations, provides information on sources for operating assets, and supplies initial forms and materials. Ongoing support from Mighty Auto Parts includes continuous business and sales training, periodic assistance with local advertising and marketing materials, and individual or group counseling through various channels like telephone, video conferencing, seminars, newsletters, or bulletins. The franchisor conducts inspections of the business, offers advice on operating techniques, and actively assists in purchasing the Mighty Product Line, including providing a list of approved suppliers. Franchisees also have the opportunity to participate in the National/Regional Account Program and can access optional business consulting and additional training services.
Initial Training Hours
125
Training Location
Peachtree Corners, GA, and Franchisee Location
Ongoing Support
Mighty Auto Parts provides continuous support to its franchisees after opening. This includes ongoing business and sales training, periodic assistance with local advertising and marketing, and individual or group counseling delivered in person, by seminar, newsletters, or bulletins. The franchisor conducts inspections of the business and offers advice on operating techniques, methods, and business procedures. Mighty Auto Parts actively assists franchisees in purchasing the Mighty Product Line and provides a list of approved suppliers. Franchisees can also participate in the National/Regional Account Program. Furthermore, the franchisor offers national and regional sales and business meetings, along with special in-depth sales and product training courses throughout the year.
Franchise Requirements
Ideal Candidate Profile
Mighty Auto Parts seeks individuals who demonstrate strong business and management skills, as the success of the franchise heavily relies on these abilities. Ideal candidates are expected to devote full-time and best efforts to managing and operating the business, actively promoting the Mighty Product Line, and expanding its market within their territory. They should be committed to direct, on-premises supervision of the business or ensure a designated manager with met training qualifications is always present. The franchisor values candidates with necessary financial resources, good moral character, a satisfactory credit rating, and an aptitude to operate the business, which can be evidenced by prior related business experience. They must also be committed to following operational guidelines and achieving sales growth.
Industry Experience Required
No
Management Experience Required
Yes
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Commercial
Owner Participation
hands-on
Territory Type
limited
Territory Size Requirements
Mighty Auto Parts' franchise territories are typically defined by geographic boundaries like county lines, interstate highways, or street addresses. A standard territory usually encompasses an area with at least 500,000 registered cars and light trucks, generally ranging up to 1,500,000 vehicles, although exceptions may be made for low-density population areas.
Staffing Notes
Mighty Auto Parts provides guidance on staffing, including details on functional roles, compensation models for various positions like Designated Manager, Operations Manager, Sales Team, Service Representatives, and Warehouse Personnel. The franchisor also offers recruiting tools, aptitude testing for salespeople, and new employee orientation tools. Franchisees are responsible for selecting, hiring, and managing their employees, but the Operations Manual and Sales Manual contain valuable information to assist with these decisions. The franchisor also provides non-solicitation guidelines for employees.