CAMBRIDGE, Ohio-Inventory control is the single most important business function facing independent tire dealers, according to Lee Fiedler, Kelly-Springfield Tire Co. president and CEO. In order to survive, small dealerships must quickly come to terms with selling an ever-expanding list of tire offerings to consumers who have less shopping time and a greater demand for quality service at a fair price, Mr. Fiedler told attendees of the Ohio Tire Dealers & Retreaders annual convention near Cambridge, June 25.
``In the next few years, one of the key things in your business is the ability to have the right product at the right place at the right time,'' he said. ``Whoever does that is really going to be the winner.''
Mr. Fiedler's upbeat keynote address focused on trends in the U.S. automotive and tire industries that he said have created a time ``that has got to excite us all.''
Increases in population, vehicle production, miles driven per vehicle and average vehicle life bode well for the replacement passenger tire market, which Mr. Fiedler estimated at about 165.5 million units this year-an increase from 165.1 million units in 1993.
But one of the most drastic changes, he said, is the growing number of replacement tire options available to consumers. The top 20 radial sizes are expected to represent only 64 percent of consumer demand this year.
``It all points out that with the many series and types and sizes on today's market, it takes management to run your inventory,'' Mr. Fiedler said. ``It's going to become the most important thing you can do.''
Dealers need to be aware that, on a countrywide basis, high performance tires are expected to command 30 percent of the overall passenger replacement market, he said. That number continues to grow, with large numbers of T-rated tires being supplied to the original equipment market-a trend that also will eventually sweep its way into the replacement market.
More stunning in its growth pattern, however, is the light truck sector, which Mr. Fiedler said offers dealers their best opportunity for profit.
LT replacement shipments are expected to increase by about one million units this year, he predicted, to around 24.5 million units.
Mr. Fiedler said he doesn't see dealers getting their fair share of this light truck tire business-much of which is going to mass merchandisers.
``...(M)aybe we need to put more emphasis on (LT tire sales) because that is a growing part of the market,'' he advised dealers.
Still, the recent consumer shift to mass merchandisers seems to have settled, Mr. Fiedler said. Independents-particularly large, multibrand dealerships-are holding 64 percent of the replacement market, while mass merchandiser tire sales are ``staying level'' and those to auto supply stores are ``going down,'' he explained.
Multilocation, multibrand dealerships are prospering, Mr. Fiedler said, because they offer choices to customers who find they have less time to shop for tires. Today, 51 percent of consumers purchase their tires in less than one day compared to eight years ago when they would spend as much as one week, he said.
``They have to know you; they have to trust you; and they want to come in and pick their tires right away,'' Mr. Fiedler said. ``Our challenge is to provide even faster service, accelerating the consumer's tire selection process.''