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TheStreet Open House

How Batteries Plus Recharged During the Recession

Stocks in this article: MCDVSI

HARTLAND, Wisc. ( TheStreet) -- Batteries Plus seems an unlikely place for business owners to learn lessons about managing through a recession.

Yet the 500-plus franchised chain, specializing in retail-sold and business-to-business battery and light bulb products, was able to ride out the recession better than other franchise systems by choosing to invest in its business. By spending the last four years improving its infrastructure and business model and focusing on "controllable outcomes," Batteries Plus has been able to grow same-store sales, on average, by 12% over the last five years.

Batteries Plus deserves a AA grade for its recession strategy.

Last year the company opened 59 stores and signed a record 49 franchise agreements that would put an additional 71 Batteries Plus stores on the map.

It helps to have the backing of a private equity firm. Batteries Plus is one of two dozen consumer-focused companies owned by Atlanta-based private equity firm Roark Capital.

One of the biggest maneuvers Batteries Plus implemented was to expand its product line during a time when many other companies were retreating from the market. The company made the decision to expand into light bulbs in 2010.

Light bulbs? Yes.

The light bulb industry is growing rapidly, particularly because of the incandescent bulb phase out laws initiated in 2007 that are intended to spur the adoption of more efficient bulbs by consumers, Batteries Plus says. More than 300 of its stores now sell light bulbs.

CEO and President Russ Reynolds shares more lessons from the recession.

What is it about your product line that allowed it to be recession-proof?

Reynolds: We're all familiar with the fact that we're more reliant on portable energy. Whether it's a tool or how we communicate over the phone -- today we carry it with us. It requires rechargeable batteries. We can't take credit for the fact that the demand drivers have been strong, but as we headed into the recession the first thing that we needed to do was focus on our industry and the controllable outcomes in the business.

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