BUFFALO, N.Y.-Two former Dunlop Tire Corp. executives and a Buffalo investment firm have acquired Dunn Tire Corp., a large independent tire dealership in western New York. The acquisition reunites Richard Miller, a former Dunlop Tire executive vice president who joined Dunn Tire in 1993 as president, and Randall Clark, former Dunlop chairman and CEO, who will serve as Dunn Tire chairman. Both had worked together for more than 14 years at the Buffalo-based tire manufacturer.
The two men will oversee the growth and market expansion of the 19-outlet retail tire dealership, which sells only tires and tire-related services. The dealership garnered $26.2 million in sales last year, according to Mr. Miller, and expects to generate revenues of $27 million this year.
Mr. Miller had joined Buffalo-based Dunn Tire when Buffalo Ventures Inc., an investment banking firm, and Heller Equity Capital Corp. of Chicago bought a majority stake in the dealership from James Dunn, who founded the company in 1973.
When Heller Equity decided to exit the equity portfolio business earlier this year, Buffalo Ventures opted to buy the Dunn Tire shares held by Heller and the remaining shares held by Mr. Dunn, who planned to retire. The acquisition was finalized June 20.
Mr. Clark, a shareholder in Buffalo Ventures, headed Dunlop Tire until 1991 and later served as executive vice president and COO of Pratt & Lambert United Inc., until the paint and chemicals manufacturer was acquired by competitor Sherwin-Williams Co. earlier this year.
Besides Mr. Clark, Buffalo Ventures comprises a number of prominent business executives who invest in Buffalo-area businesses and ventures. Mr. Miller said Dunn Tire is attractive to these investors because it is local, profitable and a regional institution that holds a dominant 25-percent share of the retail tire market between Buffalo and Syracuse, N.Y. to the east, and northern Pennsylvania to the south.
One reason for Dunn Tire's market leadership, Mr. Miller said, is that it is a ``dominant advertiser,'' promoting its ``quality, integrity and value'' in ads that run in local newspapers and television. ``Our next closest competitor does not spend a fraction of what we do (in advertising),'' he said.
Since Mr. Miller joined Dunn Tire, the dealership has grown from 11 locations to 19. Next year, the company plans to open at least three more stores in existing markets.
Mr. Miller said the dealership is operating in a flat market, so growth will come through new stores and new markets, he said.
Despite the industry trend, Dunn Tire has been doing quite
well focusing only on tire sales. And, according to Mr. Miller, the dealership has no intention of delving into automotive service.
Dunn Tire sells Dunlop, General, Kelly-Springfield, Mastercraft, Nitto and Tribune brand tires, and provides tire mounting and balancing service. However, the dealership probably will add alignment service as a complementary offering in the not-too-distant future, Mr. Miller said.
``We have no intention to go further than that,'' Mr. Miller said. ``If you focus on tires, you can do well. . . . You understand the product, and stay on top of trends. . . .The real clue is to focus on tires-do better than anyone else who sells a lot of other things.''