Probably the most important seminar a tire dealer or retreader should attend in this era of rapid change is one on financial management. Yet, more often than not, one of the least attended sessions at any dealer/retreader convention deals with this subject. This lack of interest in better understanding financial operations could spell doom for many tire businesses.
Success today calls for more than doing a good job selling products and services or producing a quality retread.
These activities are no less vital than in the past. But the day is long gone-if indeed it ever existed-when tire dealers and retreaders could allow their preference for production and selling to overshadow the so-called ``business side'' of their operations.
There's no room for error in the arena where dealers and retreaders do battle for survival and success today.
As Cooper Tire & Rubber Co.'s John Zito appropriately warned attendees during the recent International Tire and Rubber Association's World Tire Conference in Louisville, Ky.: ``You can be profitable and have a negative cash flow and you'll go out of business.''
That's a powerful statement, since most business owners believe profitability to be synonymous with success. Ironically, many dealers and retreaders don't even know if their cash flow is positive or negative.
It doesn't matter what end of the business you're in, whether it be retailing, wholesaling, commercial or retreading, strict financial controls and an understanding of cash flow are crucial to a company's success.
Knowing this, it was disappointing so few attendees were on hand for Mr. Zito's excellent presentation, which explained important things such as the difference between sales margin and markup.
For dealers and retreaders who enjoy working with customers and producing a product or service, finance has to be a dry subject.
But with the difference between success and failure razor thin, dealers must make their company's finances a top priority.