ORLANDO, Fla.—Please repeat: Change is OK. Change is good.
Change is here. Now.
From the get-go, the mantra was restated in various ways at what was likely the final stand-alone annual meeting for Kelly-Springfield Tire Co. dealers. It was meant to be an encouraging message: That their tire supplier is changing how it does business—but it's not something they should fear.
Since Goodyear announced last year that it would fully integrate Kelly into its Akron operations, some of the fiercely loyal cadre of Kelly dealers have been apprehensive of what's to come. For instance: Would the exclusivity they enjoy in selling some Kelly-made tires be watered down if every Goodyear dealer in town also begins peddling them?
They were hoping for answers.
During the meeting, Feb. 17-19 at the Disney Yacht & Beach Club within Orlando's Walt Disney World complex, Kelly and Goodyear officials admitted they were short on answers—the consolidation is still a work in progress. But they were long on encouragement.
Built upon the theme ``Driving Forward,'' the event began under the warm glow of Goodyear and Kelly logos, beaming from giant screens, below the words, ``The power of one.'' A voice-over declared: ``You have a fear that mother Goodyear is taking over and you'll lose your identity. Well, it's not going to happen.''
As further reassurance to the almost 800 dealers there, Kelly brought on a clinical psychologist whose basic message was that change is not necessarily bad.
More assurances came from Brandon V. Stotsenburg, general manager of Kelly brands, who, until last October, had worked for Bridgestone/Firestone Inc.'s Dayton Tire associate brand unit.
He told dealers the secret of Kelly's success has been its independent dealers. ``Our new management team, my new sales team, will not lose focus of what's important to us—and that's you,'' he pledged.
Goodyear's vice president of sales and marketing, Marco Molinari, pointed out the benefits of the Goodyear-Kelly integration.
``You now can benefit from an opportunity to access a portfolio of brands, systems and services from the North American market leader,'' he said. Combining functions ``will create opportunities through better communication and streamlined management.'' However, ``good Kelly qualities,'' such as the ``Livewire'' ordering service, will remain intact.
He said the Goodyear-Kelly team is better than competitors—such as Michelin with its Uniroyal and BFGoodrich associate brands and Bridgestone/Firestone and its Dayton brands—because Goodyear ``has the greatest OE-carryover strength of any brand.''
The company spends more on national advertising to support its dealers' local efforts, he said. The Goodyear brand is backed up by more marketing services than any other brand, and ``leads the industry in product innovation.''
``Put it all together into a unified family of brands,'' he said, ``and you have the envy of the industry. Why? Because it's the best package available. That has to scare our competitors. And you know what? We want it to.''
Chuck Mick, Goodyear's vice president of dealer sales, North American Tire, took responsibility for implementing the strategy that ``takes advantage of the combined strengths'' of Kelly and Goodyear, telling dealers the tire maker's 12 field business units will remain ``consistent.''
Although Goodyear has combined sales regions and consolidated Kelly's regional offices with existing Goodyear regional offices to reduce its cost structure, Mr. Mick said there are no plans to merge the two sales forces because of distinct differences among the Goodyear, Kelly and associate brands and the retailers who sell them.
``The strengths of associate brands are different than the strengths of the Goodyear brand,'' he said.
``While we think it's a great opportunity for many of our existing customers to add Kelly to their current Goodyear offerings, or to add Goodyear to their current Kelly offerings, we aren't blanketing all our markets with that kind of thinking,'' he continued. ``In some cases, it doesn't make sense to combine the brands right away. Doing so could infringe upon another dealer's market area—and we won't do that.''
Goodyear is determined to keep its dealers competitive and profitable, he said. The company ``will not lose Kelly's customer focus,'' but will try to make the right decisions, not just fast decisions on brand strategy.
In a separate interview with Tire Business, Mr. Stotsenburg said that before making any decision to allow a Goodyear dealer to carry Kelly lines or vice versa, the company will evaluate requests on a case-by-case basis, taking into account ``objective statistics'' in a specific dealer's market. Goodyear's goal, he said, is to put together brand packages specific to dealers' needs.
``We won't infringe on a current dealer's market area if it doesn't benefit them and us in the future.''
In a speech to dealers, Mr. Stotsenburg said Goodyear must grow its market share and add new points of sale. But its focus ``will be to provide our current dealers with pragmatic, profitable reasons to displace competitive products with Goodyear-produced products'' in order to grow and strengthen its independent dealer channel.
To allay fears that longtime Kelly dealer contacts will be lost, Eugene Culler, Goodyear executive vice president, North American Tire, vowed that dealers will continue to deal with many of the same personnel ``who have been helping you for years.''
For the most part, dealers and distributors seemed willing to give the company some elbow room to prove its words true.
Rick Frock, who operates Carson Valley Tire in Gardnerville, Nev., said he was ``optimistic things will go real well'' once the integration is complete. He has been offered the option to sell Goodyears in his retail store, which has sold the Kelly brand for 15 years, and is giving it serious consideration.
George Shore, owner of Shore Tire, a 55-year-old retail and wholesale distributor in Lenexa, Kan., has been a Lee dealer for 35 years and has handled Goodyears for six. Noting the two very different cultures—and fierce loyalty—of Kelly and Goodyear dealers, he nonetheless left the meeting ``with a real positive feeling. We're going to work hard to make it work.''
Joe B. Thomas, president of the Spartan Tires & Private Brands Direct unit of Reliable Tire Co. in Camden, N.J., called the integration ``inevitable—it makes sense economically and gives Kelly and Goodyear some unity in their direction.
``The left hand will now know what the right hand is doing.''