DALLAS-Star Tire Co. has been in business 27 years, but owner Ned Edwards says he is on a long learning curve. In fact, even though he now runs a successful commercial/retail business in Dallas, he still strives to make improvements. And he has looked to fellow tire dealers for inspiration. In recent years Star Tire's single location has been focusing on improving and pitching its customer service, taking advantage of the uniqueness of its wheel repair service, and in general, carving a niche in the large Dallas market.
In Dallas there is heavy competition and people are somewhat jaded, Mr. Edwards said, so a business has to be unique.
Star Tire went so far as to develop a mission statement in 1990 that states: ``We believe that the best way to maintain profitable growth is to earn and retain customer loyalty. We can achieve this goal by consistently providing the best overall value in tires, automotive products and services.''
The statement appears in a color brochure the dealership created a year ago-mostly to serve as a tool for the commercial salespeople to use as a warm-up to a sale.
``We designed it for when salesmen call on new customers-not to sell a `thing' but to give five to seven ideas of the services we perform and try to convince them our heart is in the right place in giving them service,'' Mr. Edwards said.
The brochure also is ``something we can mail and tell customers who we are and why we're in business...to be successful and provide unrelenting customer service. We go the long distance to make the customer happy,'' he said.
The strong focus on customer service developed after a rocky period for the company in the late 1980s. The dealership decided in 1985 to stop paying the escalating rent for its location and build its own store. But soon after, an uncertain local economy and the col-lapse of its lender bank combined to nearly put the dealership under, he said. A Small Business Administration loan helped the company get back on its feet ``and we're doing well now.''
During the struggling times, Mr. Edwards sought the advice of successful tire dealers who flourished during the economic upheaval of the late 1980s. He developed a particular admiration for Barry Steinberg, who gained national recognition for his successful dealership, Direct Tire Sales in Watertown, Mass.
In 1992, Mr. Edwards decided to call him and learn about his business strategy. ``I sat with the phone and a legal pad with about 21 questions written on it,'' Mr. Edwards recalled. He said he has talked with Mr. Steinberg periodically since and calls the dealer an inspiration: ``It helped me get a better focus.''
While not copying what Mr. Steinberg did, Mr. Edwards did refocus his business on customer service over price and added other strategies that have paid off-such as adopting Les Schwab Tire Stores' practice of having its employees greet customers before they enter the store.
``It shows energy and desire. The customer does not have to wait for the counter person to come out from behind the counter,'' Mr. Edwards said. ``Our front counter people go out and meet the customers before they get to the door and shake hands and introduce themselves.'' This practice ``has really paid off,'' Mr. Edwards noted.
The dealership conducts periodic staff meetings to discuss focus, strategy and positive attitude. ``The negative people are not here,'' he stated. And as an incentive to adopt a positive attitude, Mr. Edwards shares profits with his staff through year-end bonuses.
The staff of 24 ``know the bonuses are predicated on profits and good, positive image,'' he said. Everyone, from the salesperson to the shop employee, has one focus, he said: ``to take good care of the customer.''
But Mr. Edwards isn't satisfied with his operation yet. His goal for 1997 is to do a better job on the retail side of his business, which accounts for 30 percent of revenues at the commercial/retail dealership. He said he recently transferred his duties of writing up retail sales orders to his staff so he can concentrate on managing the business. His goal is to make changes in the company's image to the public, enabling Star Tire to grow its retail business from 30 percent to 35 percent of total sales.
The company, which derives 20 percent of its retail sales from automotive service, wants to improve that ratio as well.
``Because we had success on the commercial side, we were not motivated to work on the retail side,'' he admitted. What's the motivation now? ``For the very reason that we offer better service than what we see from our competitors.''
The dealership unwittingly created a niche for its retail business a dozen years ago when it began offering passenger wheel repair. The service has garnered the dealership the most attention because it is an unusual service, Mr. Edwards explained. And ``in Dallas, it's tough to get attention.''
Yet the dealership doesn't do a lot of advertising, preferring not to draw the attention of big-volume competitors. ``We don't want them to know we're here,'' he said.
The majors have higher sales volumes, but their margins are lower than Star's, he noted. And many independent tire dealers who compete on price with the big retailers don't know their own costs-or margins, he noted.
Star doesn't compete on price, Mr. Edwards said. ``Price is the last thing we talk about (to the customer). We talk about how we can get the job done right the first time.''