Tough times in the pickup truck market have Santa Ana-based Line-X Franchise Development Corp. shifting gears to stir up more business.
The maker of specialty chemical sprays that protect truck bed liners from wear and corrosion has more than 500 franchisers for its brand.
But as more automobile buyers shy away from gas-hungry trucks, Line-X is now marketing its spray for other uses such as playground equipment and all-terrain vehicles.
“We like to say Line-X can be put on anything that doesn’t move for two seconds,” said Nelma FitzGerald, vice president of marketing.
One of its franchises is applying the plastic coating to parking meters in Huntington Beach, she said.
The Business Journal estimates the company does close to $50 million in yearly sales, with the total franchise operation generating about $200 million in sales.
Though pickup truck sales have been in decline, Line-X says its held revenue flat, buoyed by its international business.
The company also has made progress with its Paxcon chemical, which is designed to protect people inside buildings from bomb blasts by keeping walls from breaking up.
Paxcon is 5% of Line-X’s sales. One of its main buyers is the Pentagon, which uses Paxcon to protect the military’s headquarters building.
Its truck bed coating makes up about 90% of its sales. The treatment can cost anywhere between $400 and $850, depending on how much is used and what quality is preferred.
The end result gives a glossy look and slick feel to the surface of the bed liner.
Line-X is working with its franchises,which are in strip malls across the U.S. and in 26 countries, including half a dozen in Orange County,to develop a marketing strategy for expanding its product uses.
Its 50 Canadian franchises have always been marketing to customers other than truck owners because they’re fewer trucks there, according to FitzGerald.
“They’ve also been more profitable than U.S. stores,” she said.
Line-X thinks that about half of all truck owners want to protect their liners. Of that group, it claims to have about a third of the market as customers.
Competitors include San Diego-based Rhino Linings USA Inc. as well as a handful of smaller companies.
Last year Rhino announced that it partnered with Newport Beach-based RSI Holding Corp. to use its coating for a new line of garage and workshop cabinets.
To buy into a Line-X franchise can cost anywhere from $115,000 to $202,000 depending on which market it’s in.
Line-X says it doesn’t charge royalties, but instead makes its money from selling its chemicals to the franchises.
The company opens about 20 new operations a year.
Line-X History
Line-X first went into business here 15 years ago when Argentinean brothers Claudio and J.B. Burton discovered a use for one of their chemical concoctions.
The brothers also dabbled in other ventures, like making bowling balls.
They sold the company to the Newton Square, Penn.-based Graham Partners Inc. in 2005, though remain on the board of directors.
When Graham Partners took over, it hired new management and added a research and development department to Line-X.
So far, the company has come up with seven new products it could market to the construction, manufacturing, mining and transportation industries, among others.
It recently announced a fire-retardant coating created for the mining industry to protect equipment.
Chief Executive John Q. Wesley II joined the company last year after leaving a job as senior vice president of sales for Lexington, Ky.-based Valvoline Oil Co., a division of Covington, Ky.-based Ashland Inc.
Graham Partners, with more than $850 million in holdings, owns 16 companies, mostly in plastics and other materials.
Last September, Graham Partners said it bought Fontana-based Flex-Trim Inc., a plastics building product maker.
