Mavis Tire Express Services – David Roux and Tom O’Rourke (BayPine), (S2.EP.07)
May 31, 2023
45:55
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Quick takeaways
BayPine focuses on digitally transforming Mavis Tire Express Services to improve customer experience and operational efficiency through user-friendly websites and digital marketing.
BayPine won the bid to invest in Mavis Tire Express based on their comprehensive digital strategy and potential for unlocking significant value through technology-driven growth.
Deep dives
Digital Transformation Strategy for Mavis Tire Express
Baypine, a private equity firm, discusses their strategy of digitally transforming Mavis Tire Express Services, an independent tire dealer and auto service provider. The focus is on improving the customer experience through a user-friendly website, internal system automation, and digital marketing. The goal is to increase online presence, drive more traffic to stores, and enhance operational efficiency. The pandemic and inflation posed challenges, but the resilient industry and strong management team navigated them successfully. The business plan includes accelerating organic growth, pursuing scale M&A opportunities, and continuing their digital transformation journey.
Investment Rationale and Acquisition Process for Mavis Tire Express
Baypine's decision to invest in Mavis Tire Express was driven by the company's strong fundamentals and the opportunity for digital transformation. Mavis, a leading auto services tire platform, had a track record of growth and profitability. The acquisition process involved an auction with other prominent private equity firms. Baypine stood out by presenting a comprehensive digital strategy with clear value-added propositions. The deal was won based on the potential to unlock significant value through technology-driven growth. The long-term compounding profile of Mavis provides multiple options for exit, including a potential public listing.
Digital Initiatives and Operational Improvements at Mavis Tire Express
Baypine's digital initiatives at Mavis Tire Express focus on improving the customer experience, internal operations, and marketing. The objective is to make the tire buying process easier and more efficient through a user-friendly website, automation of store operations, and targeted digital marketing campaigns. The new digital operating system enables better capacity utilization, reduces customer leakage, and enhances overall operational efficiency. Their strategy involves increasing top-of-funnel awareness, leveraging customer data for personalized communications, and optimizing inventory management. The management team's expertise and focus on high ROI opportunities drive strong unit economics.
Challenges, Obstacles, and Growth Opportunities at Mavis Tire Express
Mavis Tire Express faced challenges during the pandemic and inflationary period, including labor shortages and rising costs of goods. However, the company's resilience, ability to pass on some cost pressures, and focus on efficiency helped maintain margins. They capitalized on the opportunity of increased consumer awareness and expanded their market share. Mavis aims to drive growth through accelerated store openings, scale acquisitions, and digital advancements. The business benefits from being in sectors that align with consumer trends, such as automotive aftermarket and internet-protected retail. The strong management team and white space for expansion provide significant growth opportunities.
David Roux and Tom O’Rourke lead BayPine, a private equity firm founded in 2019 that manages $3 billion across healthcare, consumer, industrials, and business services with a focus on growth through digital transformation.
Mavis is an independent tire dealer and aftermarket auto service provider with over 1,100 locations in the U.S. The chain dates back to 1949 and has experienced a growth explosion the last decade adding 1,000 service centers since 2015.
Our conversation covers BayPine’s strategy of digitally transforming core economy businesses, Mavis’ 74-year history, sourcing the investment, due diligence, differentiating BayPine’s bid, executing the digital strategy, and navigating macroeconomic headwinds.
For full show notes, visit the episode webpage here.
