Dealers facing competition from mass merchandisers will savor the success of Jerry Hoberman, owner of Tires Inc. in Omaha, Neb., whose dealership has prospered despite the invasion of its market by five Western Auto stores, two National Tire Warehouse outlets plus a Wal-Mart and Sam's Club in just five short years. The story of how Mr. Hoberman's company responded successfully to this daunting challenge could serve as a textbook example of how independent tire dealerships, as a whole, have survived three quarters of a century in North America's intensely competitive marketplace.
Meanwhile, Tires Inc.'s success should encourage others facing similar competition from retailing's giants.
Seeking in 1990 to liberate his 10-outlet tire dealership from a suicidal price war with these big retail chains, Mr. Hoberman and his store managers started shopping these competitors to probe their strengths and weaknesses.
As a result, they began emphasizing the dealership's technical expertise and personalized service-qualities missing in the tire departments of mass merchandisers.
Next, Mr. Hoberman and company redirected the firm's marketing focus to automotive services-a market apparently overlooked by mass merchandisers and one potentially more profitable than tire sales.
Tires Inc.'s main store in Omaha was moved to new quarters boasting 10 service bays-all clearly visible from the street-to underscore its service image.
Meanwhile, the company stepped up its service advertising, purchased new equipment and got its employees trained and certified-further adding to its service capabilities and credentials.
Automotive services now account for 45 percent of Tires Inc.'s sales dollars compared with 15 percent in years past. Yet Tires Inc. remains Omaha's No. 1 tire retailer based on market share, according to Mr. Hoberman, who says the company's bottom line has ``never looked better.''
Many retail businesses big and small-including some mass merchandisers-wish they could say the same!