RICHMOND, Va. -

CarMax leadership restated how it measures performance of a new store in light of the company taking applications for personnel to operate a facility it will open later this year in Tennessee.

CarMax is looking for personnel to staff the company’s new store in Jackson, Tenn., the company’s first store in the city and its seventh in the Volunteer State.

The new Jackson store, which is more than 7,000 square-feet, is scheduled to open in September at 1477 Vann Drive.
CarMax is seeking applicants for full and part-time positions to fill a total of 15 slots.

Available positions include auto repair specialists and customer specialists, who work with the customers from start to finish on vehicles purchases and appraisals.

Auto repair specialists require previous automotive experience, however most positions do not.

Many CarMax associates have worked for other major retailers, such as Target, Lowe’s, Wal-Mart and Macy’s.

While this store will not start selling inventory until fall, CarMax vice president of investor relations Katharine Kenny explained again when the company will expect this Jackson store and all other new dealerships to fully mature and help the CarMax’s bottom line.

“We still do believe that a five-year ramp is the way to look at the maturity of our stores,” Kenny said last week in Chicago during the Robert W. Baird and Co. Growth Stock Conference.

“What we do is we go into a new market and we have a department that estimates what the demographics will be in that store and what kind of sales we can expect in the fifth year, which we think of as initial maturity:” she continued.

Kenney stated that CarMax’s average store should be able to sell 350 vehicles monthly during its fifth year operation. Initially however, she noted that new stores often sell about 65 to 70 percent of that five-year maturity pace.

“The unfortunate part of that is in the first year we’ll pretty much have our fixed costs in place but only 65 to 70 percent of our sales,” Kenny said. “Opening new stores is very positive from a comp perspective, but it is a negative in that it does put a little bit of a headwind in our SG&A costs and puts a little bit of a drag on overall profits.”

Kenny also mentioned that as of the first quarter, only about 19 percent of CarMax’s entire store base was not in the mature category. Prior to the recession, she noted that nearly 45 percent of the company’s dealership network was in operation five years or less.

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