DAYTON, Ohio—After several months of training, negotiating potential deals and waiting, Ed Gallagher is now an independent tire dealer. The retired Goodyear vice president of replacement tire sales has purchased three former Goodyear company-owned stores in Dayton and opened for business June 1 as Gallagher Tire and Automotive Services Inc.
One store, a downtown location, sells both retail and wholesale, while the other two are retail-only outlets.
Mr. Gallagher owns the business outright, but is operating it with his two sons, Eddie, 31, and Tony, 25, who is president.
The company carries Goodyear products but will obtain other brands for customers who request them, Mr. Gallagher said.
Currently, 65 percent of Gallagher Tire's business is automotive service, but he said the company will push to increase its tire sales and also will offer custom wheels.
Mr. Gallagher declined to disclose how much he paid for the stores, but said together they yield $3 million in sales annually. Gallagher Tire has 31 employees, most formerly Goodyear workers who stayed on with Mr. Gallagher.
The new dealership is the culmination of a process that took longer than anticipated, said Mr. Gallagher, who had expected to go into business immediately after his retirement from Goodyear in August 1998 by becoming a partner with an undisclosed dealer.
But that didn't materialize.
Mr. Gallagher then set his sights on another acquisition, but backed away when the land for the stores wasn't up to Environmental Protection Agency standards. He wouldn't elaborate.
``I thought we would kick off Jan. 1. It unfortunately took five months to put together,'' he said.
Mr. Gallagher also spent seven months learning the tools of the tire trade as a consultant to Phil Vespia, owner of Vespia Tire Centers Inc. in South River, N.J., a Goodyear dealership with 23 locations. ``That turned out to be a godsend,'' he said.
``Lo and behold, you thought you really knew the business until you get right down in front of the customer and the associates in the stores. That was just good practice for me.''
As Mr. Gallagher helped Mr. Vespia with his company's infrastructure, he saw firsthand how a family-owned business should be operated.
``It was an excellent learning experience. If there was any kind of mandatory training for tire executives, it ought to be opening up a facility or working in a facility. Once a year (executives) ought to be made to go down and do that.''
Mr. Gallagher was familiar with the Dayton area because one of his sons had attended college in that southwestern Ohio city.
He studied the competition in that market, demographics and prospects for long-term economic growth and decided that was the area to start his enterprise.
When a potential acquisition fell through, Mr. Gallagher approached Gene Culler, Goodyear's executive vice president of North American Tire, about purchasing the tire maker's Dayton stores, which he knew weren't profitable for the firm.
His proposition surprised his colleagues at Goodyear.
``Everyone said, `Dayton?' But it worked out,'' he said.
Mr. Gallagher plans to expand Gallagher Tire within the city's metropolitan area, possibly at a rate of one store per year after the company's third year in business. He foresees eventually opening up to 10 stores in that market.
Despite the longer-than-expected startup, Mr. Gallagher admitted all the work involved has drawn him closer to his sons, who will one day own the dealership.
``This has worked out so much better for me in the long run,'' he said, ``because the bonding that's going to take place with the two boys is only going to bring us closer and closer.''