Monro, Inc. Common Stock Piper Sandler 5th Annual Growth Frontiers Conference

Thanks for having us, Peter.

Yeah, absolutely. I would love to. Just to rewind for one second. We had embarked on an evaluation of performance improvement levers back in April of 2025, and out of that came the four work streams that you had just mentioned. The first of which being the closure of underperforming stores. We did close 145 underperforming stores. We did that by the end of May of 2025, so in really quick order. Got the inventory moved around, and those stores were dark in May of 2025. That was important because we wanted to get that work behind us to allow the team to really focus on the opportunities for growth that we identified in the other three work streams.

Since the closure of those stores, a small team has been working to monetize those locations, and we've successfully received proceeds of about $28 million to monetize a lot of those stores. We currently have 37 stores left, and those 37 stores are expected to be monetized over the next few quarters. That being said, we moved on to the second work stream, which is related to marketing. What we believe and what the output of the analysis showed is that we under-invested in marketing post-COVID, and we also had some suboptimal results from our marketing. As we embarked on the new journey related to our marketing investments, we identified two areas which are obvious areas to focus our investment. One is on customer acquisition, and with that, we identified our highest value customers.

We looked at our current portfolio of customers, looked at who the highest value customers were, and really focused on targeting those lookalike customers in order to drive the best customer lifetime value. We focused on digital marketing such as pay per click and paid word search, and we've seen really good results around that. That allowed us to scale in about 100 to 150 store increments through December of 2025. We reached about 950 stores receiving that incremental marketing. Not all stores deserved that incremental marketing or needed that incremental marketing, so that was basically full run rate through December of 2025. During that time period, we also looked at our CRM results, and we made new investments in CRM campaigns, where we basically focused those campaigns on the highest return of communications back to our customers.

Think if you were in for a service and we recommended another service and we didn't give you that service, then we ultimately send you a note or a postcard or an email, however you want to be communicated with, to bring you back into the store. So we focused on and tested out a lot of testing on our highest return campaigns against the highest return services. In addition, on the marketing side, during that time period, we increased and enhanced our leadership in marketing. We hired Tim Farrell, who's our VP of marketing. He's got tremendous multi-unit experience and a lot of it in the auto aftermarket, having spent time in Valvoline and Sun Auto. With that, we've continued to refine our journey on marketing.

Our current enhancements related to the customer acquisition spend is really taking that national approach now that we're rolled out and going back into the markets and back into the customer profiles and getting much more targeted to try to drive enhanced returns for our existing spend by focusing on markets that are responding the most to the marketing and de-emphasizing markets that maybe we need to take a different path with in terms of driving traffic. On the CRM side, we're leaning heavily into AI and machine learning to optimize that customer retention targeting.

Really trying to hone in on that one-to-one message to the consumer about a past service that they didn't get that we believe they need now, or based on mileage requirements of their vehicle, hitting them with an offer where we believe they'd be in market for something like an oil change, brakes, or tires. That is the continued journey around marketing. Our third work stream is related to in-store execution and selling effectiveness in the stores. What we found as a result of the assessment that we performed was that we do really well when we have teams following the Monro playbook, but when we have variation in performance and execution against that, it's when we have fall off in overall financial performance in those stores. It was really about creating consistency across how we're executing.

The first piece of that, and the first piece of the customer journey, is related to how our stores interact with our guests before they even show up. We really created a standardized process and playbook for how our stores handle online appointments. We always had a standardized online appointments calendar and scheduling system. It was implemented, it was adhered to differently store by store in terms of priority given to the online appointment, in terms of having inventory readily available when that appointment comes in terms of having to reschedule the appointment, how we interact with the guest. We standardize all of that, so our stores are now using the online appointment scheduler in a standardized way. In addition, for guests that want to call our store and not interact online, we implemented a store-wide call center located overseas.

This call center provides a consistent experience for any guest who's looking to make an appointment with us. They still have the ability to reach the store if they've got specific questions or want to talk to the store manager, or if the call center agent requires additional support from the store in handling any questions that the guest may have. But that really standardized the front end. We moved into the store. We'll talk about ConfiDrive, I'm sure, but ConfiDrive, which is our digital courtesy inspection, has really become the backbone for the in-store process and execution. That really takes the full 360 view of the customer's car and allows us to communicate effectively throughout the in-store process about those needs and sell them what they need and help prioritize what they can wait on. The other piece related to stores is how we're overseeing the stores.

When we closed 145 stores, we were able to streamline our district managers. We require less of them because we have less stores. With that, we were really able to overall elevate the capabilities of our remaining store managers or of our remaining district managers. So we have a much more streamlined communication process with those remaining district managers, and we feel that they're all at a higher level collectively than we were before the store closure streamlining. In addition, we gave them additional administrative support. A lot of things that fell on the district manager were compliance items, things like inventory counts, piece counts, oil tank measuring, safety inspections, lift inspections. All extremely important things, but also things that distracted the district manager from focusing on improving performance, coaching, and enhancing operations.

We added administrative support through operational excellence specialists that go out in the field and basically perform those services independent of the district manager. The results are still the responsibility of the district manager to effectuate. If we have an inventory shrink issue here or a safety issue here, those are being identified by the operations specialist to the district manager for corrective action. But the actual counting and inspecting no longer falls on the district manager. It frees up a lot of time for them to focus on operations. In addition to that, we have implemented what we call our DM toolkit, district manager toolkit. It helps our district managers oversee the stores. It really is a connectivity between trailing metrics and leading KPIs. We have had a really robust scorecard that will tell you everything you want about what the outputs are of a store.

What this does, it really connects it to the leading indicator. If you are falling short in brake sales, it takes it and it connects it all the way back to the digital courtesy inspection, the ConfiDrive inspection, and helps you identify the reasons why maybe your inspection process or how you are selling off of that inspection process is letting you down and therefore resulting in less brake sales than the rest of your district or than what we would expect. It allows the district managers to connect a lot of the dots and then, most importantly, connect the dots for the store manager about how behaviors can change results. We had that originally launched to 150 stores. We now have it rolled out to 340 with the real focus right now on our underperforming stores.