MIAMI (Aug. 15, 2014) — Tire distributor Zafco International Inc. plans to expand its U.S. retail business — comprising 11 Martino Tire & Service Centers in South Florida — nationwide, potentially reaching 100 stores or more in several major metropolitan areas.
The company, a subsidiary of Dubai, United Arab Emirates-based Zafco Trading L.L.C., acquired the Martino Tire retail business in 2011 — which at that time had pared down to six locations — and added three stores in south Florida during 2013, the company said in a recent business update briefing.
The most recent opening, in Boynton Beach, took place last November.
Zafco is evaluating markets in California and Texas for its first series of moves, according to Minoo Mehta, general manager, who sees a five- to six-year time frame to carry out the expansion.
Building a network that size will involve acquisitions, leases and build-to-suit projects, Mr. Mehta said. Zafco plans to use the Martino Tire name for its new stores, regardless of geographical region, he added, saying Zafco believes the name has brand equity and cachet.
At its peak in 2005-06, Martino Tire had 27 retail stores throughout South Florida along with a substantial wholesale business. It sold the wholesale business in 2007 to American Tire Distributors Inc.
The typical Martino Tire outlet will cover 6,500 square feet and have 10 bays, Mr. Mehta said.
Zafco is not disclosing its investment budget for the retail expansion, owing to the variable nature of the expansion — i.e., it will depend on the number and size of acquisitions vs. new constructions vs. leases, etc., Mr. Mehta said.
Based on a sampling of recent business activity, adding new stores — whether by acquisition or new construction — requires a budget of at least $1 million per location.
The company anticipates opening five to seven outlets in Florida this year, he said, and expects to start opening its first stores outside of Florida next year.
Zafco’s primary business is wholesaling. In North America it distributes the Accelera and Zeetex brands along with the Armstrong brand it relaunched last year.
Martino Tire’s locations in South Florida are in: Boynton Beach, Davie, Ft. Lauderdale, Margate, Miami (three locations), Miami Beach, Royal Palm Beach, Sunrise and West Palm Beach (commercial).
Mr. Mehta joined Zafco two years ago after two years with American Tire Depot in California and a dozen years with Discount Tire Centers in California.
What's your company's most important asset?
|Total votes: 108|