Rent-A-Wreck

CONNECTICUT

Ernesto Mongillo Jr. claims the business is on track to hit $1 million in revenues this year.
Source: Rent-A-Wreck
Ernesto Mongillo Jr. claims the business is on track to hit $1 million in revenues this year.
Description: Used-car rentals
Owner: Ernesto Mongillo Jr.
Years in business: 25
No. of franchises owned: 5
Start-up costs: $18,000 to $75,000; $50,000
Franchisor fees: Royalties $34 per car per month; marketing $8 per car per month
2015 revenue, 2016 projection: $850,000; $1 million
2016 projected annual growth rate: 15%

Ernesto Mongillo Sr. started his used-car lot in East Haven, Connecticut, in 1977 and was happy with the business he created. Then, in 1991, he saw a flier for Rent-A-Wreck — a national car-rental company that is known for renting used cars at discount prices. The company's catchy name doesn't actually describe the cars it rents; it was chosen so that customers would remember it. Mongillo realized that renting out his used cars rather than having them sit on the lot until they sold would enable him to generate another revenue stream, and he bought his first Rent-A-Wreck franchise.

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Today his son, Ernesto junior, runs the family's five Rent-A-Wrecks in East Haven and the surrounding areas and said the business model has been a good one. "One of the most attractive things that convinced us to get involved was the fact that there are other franchisees we can turn to for help," he said. "If a customer rents a car here in Connecticut and breaks down in another state, they're not stranded. Another Rent-A-Wreck franchisee can help us out. If we did this on our own, we wouldn't have that support."

Despite the tongue-in-cheek name, Ernesto junior said the franchisor has worked hard to establish a reputation as a reliable alternative to the more expensive, new car-rental brands. His business is on track to hit $1 million in revenues this year and employs 10 workers, serving approximately 150 customers per month. "Customers don't forget the name," he said. "But in reality, we rent out clean, dependable cars at good prices, and we always try to over-deliver on our service."

"One of the most attractive things that convinced us to get involved was the fact that there are other franchisees we can turn to for help." -Ernesto Mongillo Jr.

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