About Monro
Monro, Inc. (Monro) is a leading nation-wide operator of retail tire and automotive repair stores in the United States. The company offers to its customers, referred to as guests, replacement tires and tire related services, automotive undercar repair services, and a broad range of routine maintenance services, primarily on passenger cars, light trucks, and vans. The company also provides other products and services for brakes; mufflers and exhaust systems; and steering, drive train, suspension, and wheel alignment. The company’s retail tire and automotive repair stores operate primarily under the brands Monro Auto Service and Tire Centers, Tire Choice Auto Service Centers, Mr. Tire Auto Service Centers, Car-X Tire & Auto, Tire Warehouse Tires for Less, Ken Towery’s Tire & Auto Care, Mountain View Tire & Auto Service, and Tire Barn Warehouse. The typical format for a Monro store is a free-standing building consisting of a sales area, fully equipped service bays and a parts/tires storage area. Most service bays are equipped with above-ground electric vehicle lifts. Generally, each store is located within 25 miles of a key store which carries approximately double the inventory of a typical store and serves as a mini-distribution point for slower moving inventory for other stores in its area. The company’s locations that serve commercial customers generally operate consistently with its other retail locations, except that the sales mix for these locations includes a higher number of commercial tires. In June 2022, the company completed the divestiture of assets relating to its wholesale operations (seven locations) and internal tire distribution operations to American Tire Distributors, Inc. (ATD). The company also entered into additional agreements with ATD, including a managed services agreement, under which ATD provides category management, ordering, dashboard, and inventory managed services to it, and an agreement relating to preferred data services provided to it by ATD. Business Strategy The company will continue to invest in and execute strategic initiatives to improve its guests’ in-store experience. The company intends to be able to offer better value than new car dealers to more price-sensitive consumers. The company will continue to invest in technology and training to accelerate productivity and team engagement. The company is committed to building an omni-channel presence through its primary brand websites to create a seamless buying experience for its customers. With responsive optimized design for mobile users, a streamlined tire search and improved content and functionality, the company’s brand websites better position it to address its customers’ needs. These websites, aligned with the company’s primary brand names, help customers search for store locations, access coupons, make service appointments, shop for tires, and access information on its services and products, as well as car care tips. Importantly, they better showcase the solutions it provides to its customers, including its Good, Better, Best product and service packages. Executing on accretive acquisition opportunities remains a key element of its growth strategy. The company has a robust pipeline and the fragmentation of its industry allows for many opportunities for consolidation. In addition to its plan to continue to seek suitable acquisitions, the company plans to add new greenfield stores. Greenfield stores include new construction, as well as the acquisition of one to four store operations. Purchasing and Distribution The company purchases most of the tires it sells to its guests through a distribution agreement under which ATD supplies and sells certain tires to its retail locations. ATD also provides tire category management, ordering and inventory management services to the company. The company’s ten largest vendors accounted for approximately 95 percent of its total stocking purchases, with the largest vendor accounting for approximately 33 percent of total stocking purchases in 2023. The company enters into contracts with certain parts and tire suppliers, some of which require it to buy (at market competitive prices) up to 100 percent its annual purchases of specific products. Seasonality Although the company’s business is not highly seasonal, customers do purchase more undercar service during the period of March through October than the period of November through February, when miles driven tend to be lower. Sales of tires are more heavily weighted in the months of May through August, and October through December. The slowest months are typically January through April and September. As a result, profitability is typically lower during slower sales months, or months where mix is more heavily weighted toward tires, which is a lower margin category. Regulations Monro stores new oil and recycled antifreeze and generates and/or handles used tires and automotive oils, antifreeze, and certain solvents, which are disposed of by licensed third-party contractors. In certain states, as required, the company also recycles oil filters. Accordingly, the company is subject to numerous federal, state, and local environmental laws, including the Comprehensive Environmental Response Compensation and Liability Act. In addition, the United States Environmental Protection Agency (the EPA), under the Resource Conservation and Recovery Act (RCRA), as well as various state and local environmental protection agencies, regulate its handling and disposal of certain waste products and other materials. History The company was founded in 1957. The company was incorporated in the state of New York in 1959. It was formerly known as Monro Muffler Brake, Inc. and changed its name to Monro, Inc. in 2017.
