ST. PETERS, Mo.-The Tire Factory, a Missouri-based wholesaler/retailer, hopes to succeed where past owners of the Sonic private brand tire have fallen short. Tire Factory, the largest volume distributor of Sonic, purchased the brand's marketing rights Sept. 30 from Laramie Tire Distributors Inc., which has been in negotiations itself concerning a possible acquisition by Treadways Corp.
But St. Peters-based Tire Factory had to convince Continental General Tire Corp., which owns the Sonic name and makes the tires, and Tire Marketers Association, which distributes the line, that it could do a more effective job than two national distributors also vying for the marketing rights.
``We just kept begging,'' said Tire Factory Owner Tom Reilly, who declined to disclose the other interested parties or the sale price. He believes his company won out ``because people of greater capacity, and who handled several private brand lines, were not able to do anything with (Sonic)....It's hard to serve several masters.''
Sonic is Tire Factory's main line-about 75 percent of its business, according to Mr. Reilly. And Tire Factory, which joined TMA about 18 months ago, handles more than 40 percent of the Sonic volume. ``This is our ship,'' Mr. Reilly said. ``We're going with it.''
Sonic's eight distributors and 40 dealers are probably hoping the ``ship'' will stay anchored indefinitely this time. Tire Factory is the latest in a long line of owners of the Sonic brand and TMA, which will be renamed Sonic U.S.
TMA originally involved a group of eight stockholder distributors who owned the name and marketing rights to the Sonic brand tire manufactured by General Tire.
Big O Tires Inc. bought the operation in 1993, but after the franchiser/distributor aligned itself with Kelly-Springfield Tire Co., TMA found a new owner in one of its members, Carr's Tire Service of Harrisonburg, Va. The April 1995 acquisition was short-lived, when Laramie purchased the business in July 1995.
Laramie in turn decided to sell its Sonic marketing rights when Treadways, which does business as Sumitomo Tire (U.S.), began negotiations to purchase Laramie-and its Telstar Tyre & Rubber Co. subsidiary-as well as Jetzon Tire & Rubber Co.
Tire Factory, which Mr. Reilly founded 10 years ago, garners about $15 million in annual sales, 75 percent of which is generated through its wholesale/export business. The company also operates four retail stores in the St. Peters area, with a fifth, a 26-bay store, due to open in November.
Tire Factory currently distributes tires in California, Nevada, Oklahoma, Kansas and Missouri. It also exports tires to South America, South Korea and Israel.
Sonic's eight other distributors are scattered around the U.S., with a concentration in the Southeast. Yet there is still more than half the country untapped for Sonic, Mr. Reilly said.
Overall, he hopes to double Sonic's volume during the next four years, by expanding its U.S. distribution, as well as increasing export sales.
Don Dominguez will continue as executive director of the renamed Sonic U.S. and will relocate to St. Peters in January from his office in Clearwater, Fla. Mr. Dominguez will oversee Sonic distribution in the East while Tire Factory's sales manager, Ron Smith, will handle expansion in the West.
Existing Sonic distributors can expect larger bonuses as total volume sales increase for the group, Mr. Reilly said.
Mr. Dominguez, who has been with the transient TMA for six years, has high hopes for the new relationship. ``The fact that (Tire Factory) is actively involved in the tire business and is a dealership (means) they understand wholesale, retail and exporting and can address problems of the typical dealer,'' Mr. Dominguez said.