NORRISTOWN, Pa.-To be, or not to be a publicly held company. That, in Shakespeare-ese, was the question facing Laramie Tire Distributors Inc. and its wholly owned Telstar Tyre & Rubber Co. subsidiary. After much soul searching, Laramie officials recently decided to put on hold, at least temporarily, considerations about offering stock for sale to the public, choosing instead to solidify plans for self-funded expansion and acquisition.
It was nip-and-tuck to the end. On May 17, Skip Viola, Laramie's executive vice president, acknowledged that the Norristown, Pa.-based private brand marketer had been involved in ``more than preliminary talks-actually extensive discussions'' with banking and legal people about the possibility of taking the 24-year-old, family-owned firm public. That move would help provide an infusion of capital to help spur growth.
A day later, however, he said Laramie had decided the previous night to shelve the plans.
``We've decided to (fund) expansions and acquisitions on our own.'' That route will help ``bring a better package to go public. That's why we put it off. As far as capital infusion goes, if we do this on our own, look how much better the whole deal looks.''
The company markets its Laramie-brand passenger, light and medium truck tires nationwide, as does Telstar. Mr. Viola estimated the Laramie brand holds a replacement market share of about 1.5 percent, while Telstar accounts for approximately a half-percent share.
Wayne Reichman is president of Laramie; Telstar Tyre's president is Bill Hirst.
Laramie recently opened a leased distribution center in Denver, bringing its warehouse total to eight.
By September, it plans to open yet another to service the metropolitan Chicago and Milwaukee markets. Its search has been narrowed to three sites in the Rockford, Ill., vicinity.
The new center also will be leased, though Mr. Viola said the company normally purchases its warehouse properties.
Plans call for yet another facility that would probably begin operating by early 1995. Mr. Viola said one ``logical'' area being eyed is the Pacific Northwest because it is ``dominated by few independent (tire dealers), so there's probably room for a private brander to go up there and offer the balance of the independents a direct private brand line-and they won't have to buy a full truckload.''
Perhaps somewhat out of the ordinary, Laramie itself will distribute its tires from the Chicago center. An existing distributor in that area is getting out of the wholesale business, Mr. Viola said, and will become a Laramie customer ``in a small way.''
``If we had a distributor (there) who wanted an exclusive on the Laramie brand for that market, and could support it with certain market share figures, we'd much prefer that.
``But we don't have that situation now,'' he continued. ``We're fortunate enough we sell (exclusively to) 20 large distributors around the country. We're not about to step on their toes-that's how the private brand business works....''
What makes Laramie stand out from other private branders, Mr. Viola claimed, is ``...our ability to get product directly to a dealer. Another thing that sets us apart from everybody but TBC Corp. is that we handle all of our own tires, unlike how (others) operate.
``In other cases, a manufacturer produces the tire, inventories it, ships it to the customer, and often times even carries the receivable.
``But we don't do any of that. We buy our tires from the factory, (ship them) to the Laramie facilities, then redistribute them on our own, whether that be through our own warehouses, or through the wholesale distributors we do business with.''
The company attempts to ``create a relationship with a wholesale distributor on an exclusive basis,'' he explained, without conflicting with existing distributors.
Short-range plans include Laramie's acquisition of a couple wholesalers, although Mr. Viola would not specify which ones.
He also admitted Telstar has been ``kept in the closet for a long time,'' but that will end.
``We let each brand stand on its own in the marketplace, and we always will,'' he said, promising ``there will be a lot more promotion of the Telstar line'' in the future.
Following in the footsteps of its much larger TBC Corp. counterpart, Laramie anticipates signing, within the next few months, new long-term supply agreements-as TBC recently did-with both Kelly-Springfield Tire Co. and Cooper Tire & Rubber Co., Laramie's principal tire suppliers.
Such agreements illustrate ``consistency and longevity'' to dealers and distributors, Mr. Viola declared, because private brands seem to suffer from a misconception. ``A lot of dealers don't perceive them as being here as long as they have been, or that they're going to be here as long as they should be.''
Laramie will soon celebrate its 25th year in business, he added, ``and we always like to emphasize that to dealers....''
As for the idea about going public, Mr. Viola noted that Laramie has to get its ``timetables in line, then take another look at that situation.''
He surmised that could occur ``on the inside, from six to eight months-at the outside, 18 months down the road.''