DETROIT-After following an aggressive agenda for growth during the past 15 years, the Metro 25 Tire network is taking a more conservative approach to its program nowadays, according to President Duane Rao. The dealer group, which finished its first fiscal year as a cooperative June 30 with a $250,000 profit, held its shareholders meeting in Detroit July 17-20 to discuss current and new dealer support programs and plans for the coming year.
Two-thirds of all Metro 25 dealers are shareholders in the cooperative, which comprises five distributors and 47 tire dealerships with 123 locations in nine states.
And although the shareholders approved hiring a full-time salesperson to recruit more distributors and dealers into the program, Mr. Rao isn't anticipating a major boost in membership.
``We're not looking to add 500 stores in three years. We've got our feet to the ground,'' he said.
The new conservative approach comes from working with ``independent'' tire dealers. ``A tire dealer doesn't want anything to do with nobody,'' he said. Yet, he added, dealers realize that in today's competitive market, they have to align themselves with buying groups and marketing programs.
With this in mind, Metro 25, which made the transition from a marketing group to a cooperative in January 1994, will be focusing on helping members' bottom line, Mr. Rao said, rather than telling dealers ``how to color their stores or how to answer the phone.''
``We're going to spend time focusing on the bottom line and offering products besides tires,'' Mr. Rao said. ``We really work on suppliers for the cooperative, such as the uniform program. That's how we make our money.''
Under the cooperative program, dealer shareholders pay a monthly fee for use of the Metro 25 name and programs, and when the cooperative turns a profit, the shareholders receive annual dividends. The cooperative uses its volume buying power to negotiate special programs with suppliers of various products and services.
At the shareholders meeting, Metro 25 unveiled several new programs available to dealers, including a road service warranty through Auto Road Services Inc., office supplies through Office Depot, an Exide battery program and a uniform supply service.
Later this year, the cooperative will add the Colway Tyres brand of high-performance remanufactured tires to complement its Achievor remanufactured passenger and light truck tire line-up.
The co-op expects to eventually expand its exclusive offering of Axxium private brand tires, currently available in limited sizes.
Mr. Rao said Metro 25 still is pursuing launching a Metro 25 dealer program in Europe in conjunction with Axxium International. Due to the different business climates and regulations in each country, Metro 25 is defining the structure of the network best suited for each country.