The synergy between Home Now and Badcock makes for an exciting concept that we look forward to expanding
Don Marks, president and CEO of Badcock

photo rtoonline Albert Kohut (left), Badcock‘s VP of New Business Development, and Dan Companion, Home Now Director of Operations, at Thursday's ribbon cutting of the companies flagship rent to own store. Home Now will open 2 more locations by the end of 2005, and as many as 100 in the next 10 years. (See photo gallery of the ribbon cutting ceremony and reception)

W.S. Badcock, the 14th largest furniture retailer in the United States, sees opportunity in the rent to own industry. The 100 year old company officially opened it's flagship Home Now store in Clearwater, Florida Thursday (See photo gallery of the ribbon cutting ceremony and reception).

Home Now is the first rent-to-own company to be developed by a major retailer. Badcock's operates 350 franchise retail locations in the southeast. Once perfected, the company plans to offer the Home Now concept to existing Badcock owners.

“We are very proud to be able to celebrate the opening of the first Home Now pilot store,” said Don Marks, president and CEO of Badcock. “The synergy between Home Now and Badcock makes for an exciting concept that we look forward to expanding.” The company plans 2 more locations by the end of 05' and, according Marks, as many as 100 locations in 10 years.

photo rtoonline Don Marks, President of W.S. Badcock, at Thursday's ribbon cutting. Marks sees rental purchase as a huge opportunity for the 100 year old company that is America's 14th largest furniture retailer. (See photo gallery of the ribbon cutting ceremony and reception)

Marks explained that rent-to-own represents an opportunity for Badcock to re-capture a segment of the market lost during Badcock's "re-imaging" (Badcock & More) as a more upscale retailer. "We're growing our business big-time with the new look, but as our new look gains customers on the upper end of the spectrum, we have seen a slight deterioration of our customer base at the lower end of the economic scale."

With 350 retail stores in 7 states, Home Now is a major growth opportunity. Marks explained, "We have 150 retail stores in Florida. I can put 50 rent to own stores in Florida without cannibalizing our Badcock stores." Marks is a former Rent a Center/Thorne executive. Among other assignments, he spent 3 years in Europe as Managing Director of Radio Rentals and Crazy George before joining Badcock in 1998.

Albert Kohut, Badcock‘s VP of New Business Development, and Dan Companion, Home Now's Director of Operations and a 20 year RTO industry veteran, have spent the last year guiding Home Now from concept to reality. "The two most important ingredients in a world-class RTO operation are people and inventory," said Companion. "Our team is second to none, and Badcock's established distribution system will give Home Now a unique and repeatable competitive advantage."

One obvious change from standard RTO procedure is the lack of a weekly payment option. Home Now made the decision based on evidence from consumer focus groups held during development. "We heard loud and clear from focus groups that consumers want monthly and semi-monthly payments, not weekly." The company has no pans to offer a weekly program.

Home Now stores will feature a rent to own transaction in a retail environment unique to rent-to-own stores. The 6,000 sq. ft. stores display products in accessorized room groupings similar to those in traditional furniture showrooms.

photo rtoonline Home Now General Manager Jeff Bernecer cuts the ribbon officially opening the company's pilot store in Clearwater, Florida Thursday (8-18-05) Home Now employs five people per store; general manager, sales specialist, customer service representative, delivery truck driver and product technician. The vision of Home Now is to be recognized as "Customer Maniacs" in the rental industry by their customers and peers.

photo rtoonline Tony Hendrix, Director of Design and Construction for Badcock & More turns ideas into reality. Hendrix has been with Badcock for 25 years and describes providing a pleasing store atmosphere as part of good  customer service.

Leveraging Strengths
The partnership between Badcock and Home Now allows them the opportunity to provide customers with benefits that go beyond a traditional rent-to-own store. The merchandise available in the Home Now stores is chosen from Badcock’s catalogue, providing customers with a large product selection, in-stock product availability and fast delivery from Badcock’s regional distribution centers. Badcock operates 4 distribution centers in the southeast that can deliver any of 3000 products twice per week. “Essentially, Home Now customers will be able to get the same kind of product and service they could get in a Badcock store, but with the pricing and convenience of a rent-to-own store, ” said Albert Kohut.

Home Now also offers a free Home Now Pledge Program, which offers customers benefits such as an exclusive credit builder program to help customers establish credit, a fabric protection program, a 100-day discount, an accessory buyers discount and a national disaster waiver.

“We’re probably most excited about the credit-builder program, which we feel offers our customers something they could not get from any other rent-to-own company. This program will help our customers build credit as long as they pay off a 12-month agreement and have a good payment history,” said Kohut. Home Now will report positive payment histories to credit reporting agencies as well as provide an account at Badcock's retail stores as a reward for timely renewals.

30 trucks per day move through Badcock's 320,000 square foot Mulberry, Florida distribution center. The company operates 4 DCs in Florida, Georgia, and North Carolina.

Building a better box
"The direction Albert [Kohut] gave us was to "upgrade rental ownership.", said Tony Hendrix, Director of Design and Construction for Badcock & More. Hendrix shopped many competitors during the design process. "When our customer walks in, we want to give them a true showroom atmosphere, as opposed to a discount atmosphere," he said. Hendrix views "atmosphere" as a normal part of customer service. "[Home Now's] design echoes today's standards." Hendrix oversees store design for 350 Badcock & More locations.

Home Now can best be described, not as a re-invention, but as a calculated and carefully managed evolution of rental-purchase. After years of consolidation, the prospect of adding to the ranks of independent RTO operators, especially with the support of a world class company like Babcock & more, is a welcome change.