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FDD Talk 2015: The Wireless Zone Franchise Opportunity (Financial Performance Analysis, Estimated Costs, and Other Important Stuff You Need to Know)

by Franchise Chatter on September 9, 2015

in FDD Talk 2017: Retail Franchises, Franchise Earnings, Retail Franchise

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Wireless Zone 1

In this FDD Talk 2015 post, you’ll learn the following:

  • Section I – Background information on the Wireless Zone franchise opportunity, including relevant news updates
  • Section II – Estimated initial investment for a Wireless Zone franchise, based on Item 7 of the company’s 2015 FDD
  • Section III – Presentation and analysis of Wireless Zone’s financial performance representations, based on Item 19 of the company’s 2015 FDD, including information on the:
  • 2014 average gross commissions for postpay activations and upgrades and 2014 average gross one-time residual for all franchised Wireless Zone stores open at any time during 2014; for all franchised Wireless Zone stores open 12 full months in 2014; for the top 10% of franchised Wireless Zone stores open 12 full months in 2014; for the bottom 10% of franchised Wireless Zone stores open 12 full months in 2014; and for new franchised Wireless Zone stores opened in 2014

Section I – Background Information

Russ Weldon saw the light about cell phones more than 25 years ago. He opened his first Car Phone Store in 1988, but then in 1999 he changed the name to Wireless Zone to reflect the changing market.

He also realized early on that providing the most engaging customer service experience possible was at least as important as carrying the latest wireless gadgets people wanted. That’s what helped him make the decision to develop his franchise model. He knew that franchisees would be keen to really get involved in making their location successful.

By all accounts, it has worked, and some locations in the chain are still serving customers who bought their first phones back in the late 1980s.

Unlike the big-box electronics stores, the Car Phone Store and later the Wireless Zone approach was a much more intimate setting where people unsure about a new technology could talk to representatives and really learn what it was all about.

Today, the array of products include all the latest cellular/wireless phones, GPS navigation, wireless accessories, Verizon FIOS High Speed Fiber Optic Network, tablets, mobile hotspots, wireless data devices, and pre-paid cellular services.

With its more than 382 locations, here’s how Wireless Zone keeps everyone’s mobile phones ringing:

Verizon Partnership

It’s hard to argue that Verizon is anything but an unrivaled and powerful brand in the wireless market, which means co-branding with Verizon gives Wireless Zone a real edge in the market.

High Demand

The mobile phone and wireless technologies market continues to sizzle. The number of mobile devices out there in the world is poised to hit 10 billion probably in 2017, which is an average of 1.4 devices for every single person on the planet!

Wireless Zone’s focus is on addressing people’s changing wireless needs. After all, families inevitably end up needing to add or change devices (Americans tend to buy new phones every 22 months on average), or change their wireless plans and so forth, and Wireless Zone helps people get to the solutions that will best serve them. More than just offering devices, it offers solutions.

Declining Locations?

Given the ubiquity of mobile and wireless devices, it’s curious to see that the number of franchised Wireless Zone locations has declined steadily over the past several years as follows: 2011 = 418, 2012 = 394, 2013 = 379, 2014 = 360. Then again, it has bumped back up to more than 382 in 2015. Still, this is a far cry from their projections back in 2009 in which they expected to be adding nearly 200 locations per year.

Recognizing Outstanding Franchisees

Wireless Zone has an annual franchise conference, and they always take the time to hand out some great rewards to successful franchisees at the event. This year their categories were Rookie of the Year, Spirit of Wireless Zone Franchise, and Franchisee of the Year.

Section II – Estimated Costs

  • Please click here for detailed estimates of Wireless Zone franchise costs, based on Item 7 of the company’s 2015 FDD (updated).

Section III – Financial Performance Representations (Item 19, 2015 FDD) and Analysis

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