Interview with John D. Smith, COO, Aaron’s, Inc.
Interview with Milwaukee Courier
Aaron’s, Inc. is a leader in the hire purchase industry. Atlanta-based Aaron’s, Inc. (NYSE: AAN), is a leading omnichannel provider of hire-purchase solutions. The Aaron’s Business is engaged in the sale and rental and retailing of furniture, consumer electronics, appliances and accessories through its 1,726 company-operated and franchised stores in 47 States and Canada, as well as its e-commerce platform, Aarons.com. Aaron’s is exploring store opening in Wisconsin and recently entered into a groundbreaking memorandum of understanding with a number of civic and business groups such as the Milwaukee Urban League and the Wisconsin Black Chamber of Commerce.
John D. Smith is Aaron’s COO. He is originally from Philadelphia and graduated from Temple University and Harvard Business School. Mr. Smith is the highest ranked African American in the rental property industry.
Q: What are your current responsibilities at Aaron?
A: I oversee Aaron’s Business five US divisional teams, store support, store development which includes site selection and planning for the construction and management of the facilities and our customer contact centers. . I provide our stores and online business with the resources they need to provide our customers with the best hire-purchase experience. What we offer is a way for cash strapped customers to access and own quality products for their home. The hire-purchase option is the most affordable and flexible transaction available to those without credit. Currently, we allow our customers to own their merchandise at a higher rate than any other competitor in the industry.
Q: Many people think capital leasing companies take advantage of consumers. What is your take on the industry and the benefits that companies like yours offer to consumers?
A: My mom – a single mom and hire purchase client raised us in a housing project in Philadelphia and struggled to make ends meet. Almost half of the American population suffers with little or no credit. The hire purchase industry provides a valuable service by providing access to quality and necessary merchandise for their homes, such as refrigerators, washers and dryers, and beds. It is important to our long term success that we treat our customers with respect and fairness and because we operate with a low profit margin of 5%. Therefore, it is the responsibility of each associate to ensure a positive customer experience to treat customers fairly in order to promote customer satisfaction and customer loyalty, which leads to repeat business and referrals. The hire-purchase transaction has several advantages. Our rental contracts include delivery, set-up and service for the duration of the customer contract as well as the following customer benefits: the ability to return at any time without defect; lifelong recovery – meaning if life does arise and can no longer keep up with your payments, simply return the merchandise and when you get back on your feet contact us and we’ll restore the deal where you left off without losing your previous payments; our “No Credit Required” policy; and clear disclosure with no hidden costs.
Q: Aaron’s does not currently operate in the state of Wisconsin. Why didn’t Aaron open any locations here?
A: The hire purchase industry is regulated at the state level and hire purchase transactions, while approved in 48 other states, are not yet approved for business in Wisconsin. Therefore, it is difficult to start a business and make large capital investments to build stores and hire staff when you have no legal security to operate your business.
Q: Since major hire-purchase retailers like Aaron are not active in the state, what options currently exist for Wisconsin consumers interested in hire-purchase agreements?
A: This means Wisconsin consumers who don’t have access to credit have limited options in Wisconsin if they want to get household items like furniture, appliances, or electronics. Their options may be limited to high-interest payday or security loans or other high-interest loans that can trap a consumer in a difficult long-term obligation. If that is not an option, then it goes through pawn shops or other second hand means.
Q: There is legislation pending with the Wisconsin Legislature relating to the hire purchase industry. Could you tell us what the bill aims to accomplish and how its passage might impact the current capital leasing landscape?
A: The legislation aims to provide a regulatory and legal framework with strong protections for consumers – like reinstatement for life and six months like cash – that allows the no-obligation lease-for-own transaction to exist. in Wisconsin. Once the bill passed, Aaron’s would have the certainty to open stores in Wisconsin. Currently, Aaron’s operates in 48 states where the hire purchase transaction is recognized by state law. Q: What role would you have in overseeing stores in Wisconsin if Aaron’s decided to open stores here? A: I will lead our field and home teams to build stores, hire associates and operate Aaron stores to serve our customers with respect and fairness, as we strive to do in all of our 1,726 company-operated stores. and franchisees in 47 states and Canada every day.
Q: I understand Aaron’s has already started supporting community organizations here in Wisconsin even though there is no commercial presence here. Why did the company decide to do this?
A. Aaron’s has a long tradition of giving back to the communities it serves through its local and national nonprofit partnerships. Through the company’s guiding principle, “Caring Starts with Respect,” the Aaron Foundation is committed to improving the life prospects of at-risk youth and building strong communities by investing in their futures. In 2017 Aaron’s donated $ 2.7 million to a national and local partnership across the United States Last year Aaron’s made a significant contribution to the complete renovation of the Don and Sallie Davis Boys and Girls Club in Milwaukee . The donation to the Boys & Girls Club of Greater Milwaukee is part of a three-year, $ 5 million national partnership with the Boys & Girls Clubs of America’s Keystone program, helping teens develop character and leadership skills in the hope of helping them reach their potential and create change in the community. The Keystone Club Teen Centers provide an environment for members aged 14-18 to plan and participate in activities focused on community service, academic success, career preparation and adolescent awareness.
Q: Aaron recently entered into a memorandum of understanding with a number of minority-focused civic and business organizations and brought in former Mayor Marvin Pratt to chair his Wisconsin Diversity Advisory Council. Why did the company decide to make this kind of substantial commitment in the state of Wisconsin?
A: Aaron’s is committed to diversity and inclusion. More than a third of our store managers are minorities. We’re excited about the prospects of investing with each of these organizations and communities across Wisconsin – and I’ve already mentioned that Aaron’s has invested in Wisconsin through the Boys & Girls Clubs of America. The MOU represents a model that can be replicated here in Wisconsin with other retailers seeking or currently doing business in the minority community.