Playing catch-up: TravelCenters of America kick-starts franchising

Truck with TA sign in background

TravelCenters of America (NASDAQ: TA) is pulling the franchise lever to grow its presence on the highway map.

Actively pursuing franchisees to take over existing truck stops is one of CEO Jon Pertchik’s approaches to growing the TA, Petro Stopping Centers and TA Express travel center brands. A new TA Express franchise opened Wednesday in Mount Vernon, Texas.

“The competitors have been eating our lunch in the last few years in terms of adding dots on the map,” Pertchik told FreightWaves in a March interview. Converting existing good-quality independent truck stops in great locations to the TA model is the most efficient way to close the gap, he said.

Long way to go

By the numbers, that gap is large.

Westlake, Ohio-based TA has about 260 locations in 44 states and Canada. Pilot has 750 locations in 44 states and six Canadian provinces and ranked No. 10 on the 2019 Forbes list of America’s largest private companies. Love’s has more than 500 truck stops and convenience stores in 41 states and ranked No.17 on the same list.

“It’s a great alignment of interests,” Pertchik said in the interview. “The independents don’t get access to the big fleet business. By working with us, they do. The flip side is we can be even more successful in serving our fleet customers by having more dots on the map.”

Said Robert Berkstresser, franchise principal of Petro Stopping Centers in Raphine, Virginia, and the TA in Lexington, Virginia: “If you want to compete, you need to be aligned with a successful brand.” 

New agreements

TA has signed 18 new franchise agreements under its travel center brands since the beginning of 2019. All are expected to be open by the first quarter of 2021. TA also is negotiating franchise agreements for 13 travel centers in Western and Southern states. It is in later-stage discussions with six locations and has more than 80 other potential franchisees in the pipeline.

Pilot and Love’s are not waiting for TA. Pilot plans 20 new locations this year and 20 more in 2021, CEO Jimmy Haslam said in February. Love’s plans up to 40 new stores this year on top of 29 opened in 2019.

The franchising push is part of a May 1 reorganization in which TA laid off 130 corporate office employees and hired senior vice presidents to oversee business development, information technology and a newly created hospitality department to oversee consolidation of restaurants, gaming and convenience stores.

“Franchising is a key driver for the continued expansion of the business,” Pertchik said. “We believe putting the accelerator on this aspect of operations will allow us to become a growth engine and serve more customers and communities.”

Third generation

Some of TA’s franchises are now run by the grandchildren of the original franchisee, said Dave Raco, TA vice president of Franchise Operations.

“They stay with us,” he said. “We are recognized for our nearly 50 years of business success in the industry, and independent operators around the country are excited to become our partners to share in the same experiences.”