How Does the Do It Best Franchise Work?

Get Full Bundle:

	Business Plan	$79	$49
	Financial Model	$99	$79
	Pitch Deck	$49	$29

TOTAL:

ADD TO CART

What Are Operating Procedures of Do It Best Franchise

Curious about how the Do It Best franchise model empowers entrepreneurs? Discover the key operational and financial strategies that drive success in this dynamic retail sector. If you're considering this opportunity, our Do It Best Franchise Business Plan Template can provide a solid foundation for your venture.

Operating Procedure to Grow a Do It Best Franchise Unit

How can a member expand their business?

Members can grow their business by opening additional store locations without needing to pay additional franchise or territory fees, which is a significant advantage of the co-op model. Do It Best supports multi-store owners with centralized billing, advanced inventory management tools, and tailored marketing support for multiple locations. As of year-end 2024, approximately 30% of Do It Best members operated more than one store.

Growth can also be achieved by expanding an existing location or adding new departments like rental, commercial/industrial supply, or outdoor living, using market data and assortment plans provided by the co-op to identify the most profitable opportunities.

What are the long-term success factors?

Long-term success is strongly correlated with the owner's active engagement in the co-op, including attending semi-annual markets and participating in training to stay current on industry trends and best practices. Maximizing purchases through the co-op is critical for profitability, as it directly increases the annual rebate. Top-performing members in 2024 consistently sourced over 90% of their inventory from Do It Best, maximizing their patronage dividend.

Continuously reinvesting in the business, including store remodels, technology upgrades, and employee development, is a key driver of sustained growth. Do It Best data from 2025 shows that stores completing a major remodel see an average sales lift of 15-20% in the following year.

Operating Procedure to Exit a Do It Best Franchise Unit

What is the process for selling a store?

A member can sell their store at any time to a buyer of their choosing. The new buyer has the option to apply for their own Do It Best membership to continue operating the store under the co-op's banner. Do It Best provides succession planning resources to help owners prepare for a sale or transfer of the business to family members. These resources were utilized by over 200 members preparing for transition in 2024.

If the new owner is approved for membership, the transfer is seamless. If the buyer does not wish to join the co-op, the selling member terminates their Member Agreement and can redeem their stock equity from Do It Best.

How is the membership agreement terminated?

A member can terminate their agreement by providing written notice to the Do It Best board of directors. The termination is straightforward, with no penalties or exit fees. Upon termination, the member is entitled to have their shares of company stock repurchased by the co-op at the current book value. The stock book value has seen an average annual increase of 55% over the past decade, reaching approximately $1,300 per share by the end of fiscal 2024.

The final step involves settling any outstanding account balances with the co-op. Once the account is clear, the stock repurchase funds are paid out to the former member, typically within 90 days of the fiscal year-end following termination.

What Is The Business Model Structure?

The Do It Best business model is fundamentally different from a traditional franchise. It operates as a member-owned cooperative. This means that the store owners themselves are shareholders in the company. Instead of paying ongoing royalty fees, which are common in many hardware store franchise models, these member-owners receive patronage dividends. This structure leverages collective buying power and shared profits among its members.

To become a member-owner, as of late 2024, an investment is required in Do It Best Corp stock, specifically a minimum of $10,400. This purchase grants ownership and voting rights within the cooperative. It's a one-time investment for membership, distinguishing it from the recurring 4-6% royalty fees often found in competing franchise structures.

The financial benefits of this cooperative model are significant. For the fiscal year ending in June 2024, the cooperative reported distributing over $151 million in rebates to its members. This demonstrates a tangible return on investment directly linked to the purchasing volume each member contributes through the co-op.

How does do it best franchise work?

The cooperative structure means that 'how it works' is centered on shared benefits and collective action rather than a top-down franchise hierarchy. Member-owners, as shareholders, benefit from economies of scale achieved through bulk purchasing. This significantly lowers the cost of goods for their individual stores.

As a member, you gain access to an extensive supply chain, offering over 90,000 items. These are available through US distribution centers and direct-from-vendor programs. The forecast for 2024 indicated a strong 95% order fill rate, ensuring reliable inventory for member stores.

Do It Best also provides a suite of support services designed to enhance member success. This includes customized marketing programs and an integrated e-commerce platform, which saw a 12% increase in member adoption in 2024. Additionally, resources for employee training are available, all without incurring extra fees typically associated with franchise support packages.

What are the do it best franchise owner benefits?

The primary advantage for owners in this cooperative model is the annual patronage rebate. This rebate is calculated based on their purchasing volume through the co-op. Effectively, it reduces the cost of goods sold and boosts store profitability, a direct contrast to traditional franchise models where profits are diminished by royalty payments.

Members gain access to a vast supply chain. With over 90,000 items available from US distribution centers and direct-from-vendor programs, inventory management is streamlined. The 2024 forecast of a 95% order fill rate ensures consistent product availability.

Beyond inventory, Do It Best offers comprehensive support. This includes customized marketing programs and an integrated e-commerce platform, which saw a 12% increase in member adoption in 2024. Employee training resources are also provided, enhancing operational efficiency without additional costs.

Is do it best a good franchise to buy?

Deciding if Do It Best is a good business opportunity hinges on an entrepreneur's preference for a cooperative structure over a conventional franchise. The member-owned model emphasizes independence and allows owners to share directly in the corporation's profits through rebates.

When considering a Do It Best hardware franchise, it's important to weigh the pros and cons. A significant pro is the absence of royalty fees. In 2024, members retained an average of 5% more of their gross revenue compared to franchisees in traditional models. However, a potential con is the requirement for active participation and adherence to co-op purchasing guidelines to fully realize the rebate potential.

Success stories from 2024 highlight the advantages of this model. Members who fully engage with the co-op's marketing and technology programs report an average year-over-year sales growth of 7-9%. This performance notably exceeds the independent hardware store industry average of 4.5%. For those interested in understanding the process, How to Start a Do It Best Franchise in 7 Steps: Checklist offers a detailed guide.

What Are The Financial Commitments?

Understanding the financial landscape is crucial when considering the do it best franchise opportunity. Unlike many franchise models, this cooperative structure has a unique approach to startup costs and ongoing fees. The primary investment involves purchasing company stock, which represents equity in the cooperative itself, rather than a traditional franchise fee.

What is the do it best franchise investment required?

• The projected total initial investment for a new store, as of mid-2025, is estimated to fall between $750,000 and over $2,000,000. This wide range accounts for variables like store size, chosen location, and the initial inventory selection.
• A mandatory component of the startup costs is the purchase of company stock. As of year-end 2024, the minimum stock purchase is set at $10,400. This is an investment in ownership, not a fee.
• For a hypothetical 15,000 sq ft new store in 2025, a detailed breakdown of costs includes: initial inventory ranging from $450,000 to $600,000, fixtures and equipment estimated at $150,000 to $200,000, and real estate or leasehold improvements that could span from $100,000 to over $1,000,000.

What are the do it best hardware franchise fees?

• A significant aspect of the do it best business model is the absence of traditional franchise fees and ongoing royalties. This is a key differentiator for those exploring hardware store franchises.
• Instead of fees, members are expected to purchase the majority of their inventory through the co-op. This purchasing commitment is central to how the do it best franchising works.
• Optional services, such as technology packages for point-of-sale and e-commerce systems, come with estimated monthly costs for 2025 ranging from $300 to $600, depending on the selected service tier.
• The financial model is designed around patronage dividends. To be eligible for the maximum annual rebate, which in 2024 averaged 82% of warehouse purchases, members must source at least 80% of their total store purchases from the Do It Best distribution network.

What are the do it best franchise profitability expectations?

• Profitability for a do it best franchise owner is largely influenced by operational efficiency, sales volume, and the impact of the annual rebate.
• In 2024, member stores reported gross profit margins typically falling within the 35-42% range before the cooperative rebate is factored in.
• The annual patronage rebate can significantly enhance net profit. In fiscal 2024, the co-op returned over $151 million to its members. For a member making $1 million in annual purchases from the co-op, this could translate to a rebate of approximately $82,000, based on the average rebate percentage.
• Based on 2024 performance data, a well-managed store with annual sales of $25 million could achieve a net profit before tax between 4% and 7%. This aligns competitively within the retail hardware sector.

For a deeper dive into earnings potential, explore How Much Does a Do It Best Franchise Owner Make?

What Support and Training Are Provided?

The franchise opportunity includes comprehensive, ongoing support designed to help members operate efficiently and profitably. This encompasses retail consulting, store design assistance, and technology integration.

Marketing support is robust, offering access to a vast library of over 5,000 customizable advertising and promotional assets. For instance, in 2024, members actively utilizing the digital marketing program experienced an average increase of 15% in web traffic and a 5% uplift in online sales conversion.

Furthermore, each member is assigned a dedicated Retail Performance team member who provides personalized guidance. To ensure focused support, the ratio of consultants to stores is maintained at approximately 1-to-75 as of 2025.

What does the do it best franchise training program entail?

The co-op offers a comprehensive training program that covers essential areas such as product knowledge, retail operations, financial management, and marketing. This training is delivered through various channels, including online modules, regional workshops, and semi-annual markets.

New members are strongly encouraged to attend a multi-day orientation at the Do It Best headquarters located in Fort Wayne, Indiana. The 2025 curriculum specifically emphasizes leveraging the co-op's e-commerce platform and point-of-sale system for effective inventory management.

Ongoing training is accessible through the Do It Best Learning Management System. In 2024 alone, this platform hosted over 200 unique courses. Data indicates that stores where staff complete an average of 10 or more training modules annually experience approximately 25% lower employee turnover.

What are the do it best franchise agreement details?

Instead of a traditional franchise agreement, members sign a Member Agreement. This document outlines the terms of co-op membership, stock ownership, and purchasing requirements, and it is structured to be less restrictive than many typical franchise contracts.

Key terms within the 2025 Member Agreement stipulate that members must maintain their stock purchases and remain in good financial standing with the co-op. A notable feature is the absence of territorial restrictions, allowing members the flexibility to open stores in locations they deem suitable, a significant differentiator compared to many franchise systems.

The agreement allows members to terminate their membership at any time. In such cases, there are provisions for the co-op to repurchase the member's stock at its current book value, which was valued at approximately $1,300 per share at the close of fiscal year 2024.

For a detailed understanding of the financial commitment, you can explore How Much Does a Do It Best Franchise Cost?

Operating Procedure To Investigate The Do It Best Franchise Unit

What are the requirements to join do it best franchise?

To be considered for a do it best franchise opportunity, you'll need to be operating a retail hardware or building materials business. A key aspect of the do it best business model is shared ownership, which means purchasing a minimum required number of co-op shares. They are looking for owners who are actively involved in their business operations and their local communities.

While there isn't a publicly stated minimum net worth or liquidity requirement, successful applicants in the current year typically demonstrate a net worth of at least $1 million and have access to liquid capital of around $250,000, especially for new store projects. This financial readiness is crucial for understanding the do it best franchise investment required.

The application process involves submitting a formal application along with a comprehensive business plan. This plan undergoes a thorough review, which usually takes about 60-90 days. During this period, a Do It Best representative conducts a financial review and a market analysis to ensure alignment with their brand and operational standards.

How to apply for do it best hardware franchise?

The initial step in the application process for how does do it best franchise work is to reach out to a Do It Best New Business team member. You can do this through their corporate website or by phone to express your interest. This initial contact will provide you with an introductory information packet that clarifies the overall do it best franchising model.

Next, prospective members must complete the official Membership Application. This document requires detailed information about your business background, financial situation, and the details of your proposed or existing store location. For applicants in 2025, the application includes a specific section focused on digital strategy and e-commerce readiness, reflecting the evolving retail landscape.

The final stage of the process involves a review by the Do It Best board of directors. Once approved, you will sign the Member Agreement and complete the required stock purchase, which is $10,400, to officially become a member-owner. This signifies your entry into the do it best franchise network.

Understanding the operational procedures is vital when investigating any franchise, including the do it best franchise opportunity. This includes a deep dive into the financial aspects and the application process.

The do it best franchise agreement details will outline the specific terms and conditions of the partnership. It's important to review these thoroughly, potentially with legal counsel, to understand your rights and responsibilities as a member-owner.

For those looking to understand the full journey, the process of becoming a do it best dealer is detailed, and aspiring entrepreneurs can find more information on How to Start a Do It Best Franchise in 7 Steps: Checklist.

Operating Procedure To Launch A Do It Best Franchise Unit

What are the steps to open a new store?

Launching a new store as a do it best franchise member involves a structured process designed to ensure a successful market entry. The initial step after becoming a member is collaborating with the dedicated store design team. This team crafts an efficient and modern store layout specifically for your chosen market and building footprint. This crucial design service is included as part of your membership.

Following the store design, the next phase focuses on the practical aspects of establishment. This includes securing the necessary financing, which, based on FDD data, can range from $440,400 to $1,128,400 in cash required. Simultaneously, you'll finalize your real estate purchase or lease and commence any required construction or renovations. The do it best franchising team offers valuable support here, providing vendor contacts and project management guidance, leveraging their experience from over 50 new store projects completed in 2024.

The final pre-opening stages are intensive and typically span 90-120 days from the commencement of construction. These steps include ordering and receiving your initial inventory, installing essential fixtures and point-of-sale (POS) systems, and crucially, hiring and training your staff. The co-op provides comprehensive resources to support your hiring and training efforts, ensuring your team is ready for launch.

How is initial inventory selected?

Selecting the right initial inventory is a critical component of the do it best business model. To assist with this, new members receive a proprietary tool called 'Smart Assortment.' This innovative system analyzes local demographic data and sales trends from comparable stores to recommend a tailored product mix. As of 2025, this system processes over 200 data points to generate its recommendations, with the goal of achieving a 90% sell-through rate on initial inventory within the first year of operation.

A dedicated product specialist will then work closely with you, the new owner, to refine this recommended assortment. The aim is to strike a balance between essential core hardware categories and unique products that cater to local market niches. This collaborative approach ensures your inventory is optimized for your specific customer base. The average initial inventory investment for a 15,000 sq ft store in 2024 was approximately $525,000.

Ultimately, you, the member, retain the final decision-making authority on all inventory orders. This provides the flexibility to adjust the product selection based on your intimate knowledge of your local market. It's worth noting that the initial franchise fee for a new unit is a modest $4,400, with no marketing fee, making the do it best franchise opportunity accessible.

Understanding the financial landscape is key to assessing the do it best franchise cost breakdown. The average annual revenue per unit stands at approximately $818,696, with a median revenue of $1,128,400. The Average P&L data indicates a gross profit margin of 6.7%, with EBITDA at 4.6%. This data helps in understanding the potential profitability expectations for a do it best hardware franchise.

For those considering alternatives, it's always beneficial to explore options. You can learn more about this by reading What Are Some Alternatives to the Do It Best Franchise?.

Operating Procedure To Manage A Do It Best Franchise Unit

How are marketing and advertising handled?

When you join the do it best franchise network, you have the flexibility to manage your own marketing or leverage the robust, customizable programs provided. These offerings encompass direct mail circulars, digital advertising, social media management, and email marketing campaigns. For instance, the co-op's digital marketing program, adopted by over 65% of members as of early 2025, has demonstrated a significant impact. In 2024, it generated a reported average return on ad spend (ROAS) of 8:1. Furthermore, members contribute to a national advertising fund, which had a budget exceeding $10 million in 2025. This collective investment fuels national campaigns designed to promote the Do It Best brand and drive customer traffic to all member stores.

What technology is used for operations?

To streamline operations, the do it best business model integrates a suite of technology solutions. The recommended point-of-sale (POS) system, Epicor Eagle, is utilized by more than 70% of the membership as of 2025, ensuring a standardized and efficient checkout process. Complementing this is a fully integrated e-commerce platform. This platform facilitates online purchases with in-store pickup options, a feature that proved highly successful in 2024, processing over $200 million in sales across the membership, marking a 15% increase year-over-year. Members also gain access to a secure online portal, mydoitbest.com. This portal serves as a central hub for placing orders, managing accounts, accessing training materials, and reviewing performance analytics and business intelligence reports, which are crucial for understanding and improving store performance.

Understanding the financial landscape is key to evaluating the do it best franchise opportunity. The initial investment can range from $440,400 to $1,128,400, with the same range required for both cash and net worth. The initial franchise fee is a modest $4,400, and there is no separate marketing fee. For those considering how to become a do it best dealer, it's worth noting that the breakeven time is typically around 12 months, with an investment payback period of approximately 48 months. The average annual revenue per unit was reported at $818,696, with a median of $1,128,400. Looking at the average Profit & Loss data, the cost of goods sold (COGS) represents a significant portion at 93.3% of revenue, leaving a gross profit margin of 6.7%. Operating expenses are around 2.1%, resulting in an EBITDA of 4.6%. This financial data provides a crucial snapshot for potential franchisees looking to understand the do it best franchise cost breakdown and do it best franchise profitability expectations. Exploring options like How Much Does a Do It Best Franchise Owner Make? can offer further insights into potential earnings.

Operating Procedure To Grow A Do It Best Franchise Unit

Understanding how to operate and grow a franchise unit is crucial for long-term success. For those considering a hardware store franchise, the operational model of a co-op like Do It Best offers unique growth pathways.

How can a member expand their business?

• Members can grow their business by opening additional store locations without needing to pay additional franchise or territory fees, which is a significant advantage of the co-op model. This allows for strategic expansion into new markets or underserved areas.
• Do It Best supports multi-store owners with centralized billing, advanced inventory management tools, and tailored marketing support for multiple locations. As of year-end 2024, approximately 30% of Do It Best members operated more than one store, showcasing the viability of this growth strategy.
• Growth can also be achieved by expanding an existing location or adding new departments like rental, commercial/industrial supply, or outdoor living. This is facilitated by using market data and assortment plans provided by the co-op to identify the most profitable opportunities.

What are the long-term success factors?

• Long-term success is strongly correlated with the owner's active engagement in the co-op. This includes attending semi-annual markets and participating in training to stay current on industry trends and best practices, ensuring the business remains competitive.
• Maximizing purchases through the co-op is critical for profitability, as it directly increases the annual rebate. Top-performing members in 2024 consistently sourced over 90% of their inventory from Do It Best, maximizing their patronage dividend. This model rewards loyalty and volume.
• Continuously reinvesting in the business, including store remodels, technology upgrades, and employee development, is a key driver of sustained growth. Do It Best data from 2025 shows that stores completing a major remodel see an average sales lift of 15-20% in the following year, highlighting the impact of modernization.

The initial investment for a Do It Best franchise ranges from $440,400 to $1,128,400, with a franchise fee of $4,400. The average annual revenue per unit is reported at $818,696, with a median of $1,128,400. The breakeven time is typically around 12 months, with investment payback expected in 48 months.

For those exploring different franchise avenues within the home improvement sector, it’s beneficial to understand the broader landscape. What Are Some Alternatives to the Do It Best Franchise? provides a comparative view of other opportunities available.

Operating Procedure To Exit A Do It Best Franchise Unit

What is the process for selling a store?

When a member decides to sell their store, they have the flexibility to choose their buyer. The new owner can then apply for their own membership with the co-op, allowing them to continue operating under the established banner. To support this transition, the co-op offers succession planning resources, which were utilized by over 200 members in 2024 to prepare for business transfers, whether to family or new ownership.

If the buyer is approved for membership, the transfer process is quite smooth. However, if the buyer opts not to join the co-op, the selling member will terminate their Member Agreement. In this scenario, the selling member can then redeem their stock equity from the co-op.

How is the membership agreement terminated?

Terminating a membership agreement is a straightforward process. A member simply needs to provide written notice to the Do It Best board of directors. Importantly, there are no penalties or exit fees associated with this termination, making the exit strategy clear and predictable.

Upon termination, the member is entitled to have their shares of company stock repurchased by the co-op. This repurchase is based on the current book value of the stock. Over the last decade, the stock book value has shown a consistent growth, with an average annual increase of 5.5%, reaching approximately $1,300 per share by the end of fiscal 2024.

The final step in the exit process involves settling any outstanding account balances with the co-op. Once all accounts are clear, the funds for the stock repurchase are typically paid out to the former member. This payout usually occurs within 90 days of the fiscal year-end following the termination date.

Understanding the exit strategy is a crucial part of evaluating any franchise opportunity. For those considering this particular hardware store franchise, it's beneficial to review the What are the Pros and Cons of Owning a Do It Best Franchise? to gain a comprehensive understanding of the business model and its implications.

The initial investment for a Do It Best franchise can range from $440,400 to $1,128,400, with a franchise fee of $4,400. The average annual revenue per unit is reported at $818,696, with a median of $1,128,400. The breakeven time is typically around 12 months, and investment payback is estimated at 48 months.