It's Rent 'N' Roll At This Video Store

CLEBURNE, Texas - Michael Grozier went to his local video store to rent the latest hot movie. What he got was an idea that turned the 28-year-old former sheet-metal worker into a millionaire.

His Vidtron Inc. drive-in video rental stores in shopping-mall parking lot kiosks feed off the frustrations of customers who can't find the current top hits at larger video stores.

``What I wanted to try to create was that Golden Arches, the big V in the sky. My goal, I guess, is to do to video what McDonald's did to hamburgers,'' Grozier said.

With only four stores open peddling one-night rentals at $2.49 each, Vidtron has a long way to go before becoming McDonald's, but it's growing rapidly.

Grozier has sold franchise rights for 21 regions across the country. Stores are scheduled to open in several cities, and franchise agreements already sold include promises to open about 400 stores, which would bring $1.2 million in fees. He said his goal is 500 stores by 1991.

The idea behind Vidtron was born one evening over hamburgers.

Grozier and his wife had just been disappointed again, unable to rent a newly released videotape because all the copies were gone.

``They were always out,'' Grozier said. ``It gets frustrating, you know. . . . My wife and I went to Dairy Queen, had a hamburger, and while I was sitting there I said, `You know, somebody ought to have a video store that just carries the top 40 movies, and it ought to be a drive-through because you wouldn't need all that space like you have in a traditional walk-in store . . . just drive in and get a video and drive on home.' ''

Grozier didn't really intend to be that somebody, but at his wife's urging, he paid $250 for a kiosk once used by a drive-in photo developer, spent $40 on signs, plunked down most of his $5,000 life savings for videotapes and opened Vidtron in April 1986.

``I put it right across the street from that video store that was always out, with the idea that they'll go in, can't get what they want there and then they'll see my sign across the street.''

A few months later Grozier brought in $400 on a Saturday night. It cost him about $80 a day to run the store.

``I had a profit of a little over $300, which is more than I made all week doing sheet-metal work. So that convinced me that I'm going to give up the sheet-metal work,'' he said.

In the 2 1/2 years between the opening of his first store in Cleburne and the first franchise sales last November, Grozier created a detailed operating plan - from where to locate stores to what movies to buy.

Some experts are skeptical of Grozier's chances, noting that the big chains have become more sensitive to the kind of frustration that started Grozier on his way. But with viewers paying an estimated $197.5 million each week to rent movies, Grozier says it's worth a shot.

He opened a headquarters in Cleburne, a small town about 20 miles south of Fort Worth, and christened his company Vidtron, hoping for a name that would become as synonymous with videos as Kleenex is to tissue.

He hired franchising experts to develop his system, detailed in six manuals. The heart of it is Grozier's rating system for movies' popularity.

Grozier decided he couldn't wait for Billboard magazine to come out with the top 40 videos in a given week, so he began rating movies on his own, giving points for stars, producers, timing of the video release, first-run box office take and other factors he keeps secret.

Movies are ordered according to their rating.

Another key strategy is location. Grozier recommends that each Vidtron be located in a parking lot across the street or near a town's busiest video rental store.

There are other rules, and Grozier demands they be followed: ``It's Michael's way or the highway,'' he said.

Vidtron will not carry X-rated movies, and like some other video rental businesses, he decided ``The Last Temptation of Christ'' was too controversial a movie to handle.

When one franchisee decided to carry ``Last Temptation'' anyway, Grozier countermanded the order.

``When you buy a franchise, you buy into the system,'' he said.

The franchises are not cheap: There's a $15,000 initial fee, with $12,000 going to the regional franchise holder and $3,000 to Grozier; and additional fees can push start-up costs as high as $70,650. The lowest initial investment is estimated at $49,650.

Each franchise location pays Vidtron weekly royalties of $87.25 for services that include training and ordering advice.

``I could have gone out there and just sold the stores - wham, bam like that - but I couldn't service them properly,'' Grozier said.

Although Grozier said bankers turned him away initially, they now ask him for business. He also is considering the idea of selling stock to the public, he said.

Grozier said that he and his wife occasionally return to Dairy Queen for a hamburger, point to the table where they sat that fateful night and say, ``That's where it all began.''