Winmark: Resale at Scale - [Business Breakdowns, EP.159]

This is Matt Reustle. Today, we break down Winmark, a major player in the reseller economy. You're likely familiar with some of Winmark’s brands, like Plato's Closet or Play It Again Sports. Altogether, Winmark operates five brands through a franchising model.  Our guest to break down Winmark is the current CEO, Brett Heffes. During our conversation, we discuss the broader reseller economy, the dynamics of managing those brands and different franchise brands, and how Winmark thinks about growth. In the back half of the conversation, I also made sure to talk to Brett about his thoughts on capital allocation, focusing the business, and yes, on investor communication. Please enjoy this breakdown of Winmark. Interested in hiring from the Colossus Community? Click here. For the full show notes, transcript, and links to the best content to learn more, check out the episode page here. ----- This episode is brought to you by Public. A High-Yield Cash Account is a secondary brokerage account with Public Investing, member FINRA/SIPC. Funds from this account are automatically deposited into partner banks where they earn a variable interest and are eligible for FDIC insurance. Neither Public Investing nor any of its affiliates is a bank. US only. Learn more at public.com/disclosures/high-yield-account. This episode is brought to you by Tegus, the only investment research platform built for the investor. With traditional research vendors, the diligence process is slow, fragmented, and expensive. That leaves investors competing on how well they can aggregate data — not on their unique ability to analyze insights and make great investment decisions. Tegus offers an end-to-end platform with all the data you need to get up to speed on a company or market: up-to-the-minute financials, customizable models, management and culture checks, and, of course, our vast and growing library of expert call transcripts. Tegus is changing the world of expert research. Learn more and get your free trial at tegus.com/patrick. ----- Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes. Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. Sign up here. Follow us on Twitter: @JoinColossus | @patrick_oshag | @zbfuss | @ReustleMatt | @domcooke Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com). Show Notes (00:00:00) Welcome to Business Breakdowns (00:04:25) Exploring the Resale Market with Windmark's CEO (00:06:34) The Mechanics of Winmark's Franchise Model (00:07:10) Winmark's Unique Position In The Resale Economy (00:12:21) Franchisee Support and Business Model Insights (00:20:44) Growth Strategies and Franchisee Expansion Philosophy (00:24:12) A Look At The Franchisee Agreement (00:26:57) Traits of Successful Franchisees and Common Mistakes (00:28:42) Effective Marketing Strategies for Franchisees (00:30:45) The Importance of Viewing Stores as Legacy Assets (00:32:33) Renewal Rates and Franchisee Health as Key Metrics (00:35:27) Shifting Focus From Leasing Business to Core Resale Operations (00:41:19) Capital Allocation and Shareholder Value (00:45:51) A Unique Approach to Investor Relations (00:47:31) Lessons Learned From Breaking Down Winmark