PROSPECT, Ky.—Maintaining he has been stuck with ``a ton of debt'' owed by clients, tire retailing and marketing consultant John Wagner has folded his 6-year-old Tire Marketing Service Inc. and formed a new business. Begun in 1991 by the former managing director of the American Retreaders Association (now called the International Tire & Rubber Association), the firm mainly provided independent tire dealers with what Mr. Wagner called a ``neutral source'' for marketing, sales, training and promotion, including market studies and evaluations of store layout and consumer perceptions.
TMS filed for Chapter 7 bankruptcy—a total liquidation of assets—and closed on Jan. 9 after being unable to collect some $80,000 Mr. Wagner claimed it was owed by a number of clients, including Metro 25 Tire, which he said was a ``substantial creditor.''
``I'm a small consultant who was working for a big company that, basically, cut me off at the last minute and didn't pay off any of their bills to me,'' he said, referring to the six-month stint he served as Metro 25 president. He was hired in November 1995 by the member-owned cooperative's founder and chairman, Duane Rao, to oversee its expansion.
But Mr. Wagner was dismissed from that position last May after disagreements with Mr. Rao over the future direction of Metro 25's marketing efforts.
Reached by TIRE BUSINESS at Metro 25's Detroit headquarters, Mr. Rao called Mr. Wagner's accusations ``totally, 100 percent false.''
He said that during the time Mr. Wagner was on Metro 25's payroll, ``he got paid every single week. We never missed a minute, a penny, or a day.
``Not only that, we paid for his office expenses, his personal company expenses and his (secretary).''
``. . . I don't owe him any money. It's not me, it's (Metro 25's) executive committee. So there's a whole group of people here that made the decision'' to remove Mr. Wagner as company president.
A rather irritated Mr. Rao added that ``Metro 25 has more than met all of its obligations above and beyond the call of duty with John Wagner.''
Rather than become involved in protracted lawsuits to recover what he contends he is owed, Mr. Wagner said he ``had to take the corporation down—it was simply a business decision.''
It is the second time he has had to ``take down'' a business.
In 1993 Mr. Wagner conceived of and launched the International Commercial Tire & Service Expo, a show in Louisville, Ky., geared to commercial tire dealerships and trucking fleets. Called a critical success by some, it however was not a financial triumph.
A number of the companies—including tire manufacturers—that had put up money for the expo and signed three-year agreements to participate in successive expos backed out after the initial event failed to draw big crowds. The ARA later turned down Mr. Wagner's offer to merge his expo with the ARA's annual World Tire Conference & Exhibition in Louisville.
Faced with debt from the failed show, Commercial Expo Inc., the company set up to run the event, declared bankruptcy.
In the wake of the TMS closure, Mr. Wagner has formed a new corporation—Quality Products International (QPI)—in the same Prospect, Ky., location, with the same five TMS employees.
With QPI, Mr. Wagner said, ``we're trying to create the automotive equivalent of Amway.''
QPI will ``help small entreprenurial companies that can't get their products to the distribution market they'd like to,'' he said.
``We're going to be able to go out and make contacts with companies and organizations that want new ideas for profits and marketing. The corporation is designed strictly around that focus.
``We're taking people who just don't have the assets and capabilities to get to market and providing them with marketing and distribution.''
Private investors involved with QPI, he said, receive the marketing rights to certain products.
One of the new firm's first clients, according to Mr. Wagner, is Cincinnati-based ValuGuard Inc.
Up until now it has manufactured products aimed mostly at new-car dealerships. They include ``Wonder Wash''—a spray-on acrylic polymer, waterless ``car-wash-in-a-bottle''—and a line of Avenger-branded products such as an oil-absorbent material with microbes that ``eat'' spilled oil, and a non-solvent-based parts washer.
Mr. Wagner said he plans to retail the products through a number of channels, including tire dealerships.