AKRON—In response to increasing consolidation in the tire industry, growing numbers of independent dealers are joining marketing groups or franchise networks to benefit from the buying clout and economies of scale such organizations can offer. To obtain these benefits, however, dealerships often are required to give up a certain amount of autonomy and adopt an identity common to the group.
But what if you're a family-owned business with a long and proud tradition, and an identity you feel strongly about maintaining? Can you retain that distinct identity while still allying with other dealerships to obtain the advantages a larger group can procure?
The members of the Midwest Tire Association believe they can.
What began 10 or 15 years ago as an informal association among three family-owned dealerships based in Ohio—Ziegler Tire & Supply Co. in Canton, Grismer Tire Co. in Dayton and Andersons Tireman Auto Centers in Maumee (near Toledo)—grew and evolved into a more formal organization.
In February 1997, the MTA was formally incorporated, with the three Ohio dealerships and two others—Ken Towery's Tire & Auto Centers in Louisville, Ky., and Raben Tire Co. in Evansville, Ind.—as charter members. Bill Ziegler, secretary-treasurer of Ziegler Tire, serves as the MTA's president.
The group also has three associate members—H&F Tire Service in Lancaster, Pa., Waukegan Tire in Waukegan, Ill., and University Wholesalers in Colchester, Vt.—and altogether accounts for approximately 115 points of sale and $230 million in total sales.
The MTA has grown ``on the basis of business relationships and personal friendships,'' President Bill Ziegler said. Most of the members are Bridgestone/Firestone/Dayton dealers, he said, and have gotten to know each other over the years through dealer meetings.
In January, the MTA hired an executive director, Rod Cram, a 32-year industry veteran who took early retirement last December from Bridgestone/Firestone Inc., where he was Midwest regional manager for Dayton and associate brands.
One of the group's primary goals, Mr. Cram said, is to ``get competitive buying prices instead of being dictated to,'' and the MTA has established relationships with suppliers to secure deals on telephone service, insurance, uniforms, computers, batteries and, of course, tires. It also is trying to put together an equipment program, Mr. Ziegler said.
When it comes to dealing with the tire manufacturers, the Big Three—Goodyear, Michelin North America and Bridgestone/Firestone—haven't been as receptive as some of the second-tier and off-shore manufacturers, Mr. Ziegler said. Companies like Continental General Tire Inc. and Kelly-Springfield Tire Co. (a Goodyear division) have been very willing to work with the MTA, as have foreign companies like Hankook Tire Co. Ltd., Nokian Tyres P.L.C., Toyo Tire & Rubber Co. and Ohtsu Tire & Rubber Co.'s Falken brand, among others, Messrs. Ziegler and Cram said.
The MTA is interested in growing and would like to reach 160 points of sale and $400 million to $500 million in total sales by 2003, the two leaders said. Mr. Ziegler said the ideal candidate for membership would be ``a good family business with a good reputation and good finances that is involved in both retail and commercial business.''
Mr. Cram added that the group primarily is interested in attracting firms that do a fairly significant volume of business: $10 million or more in sales annually.
Mr. Ziegler said he sees the MTA as more than a buying group. Members meet regularly to share ideas and discuss the ways they market their products. The group also has discussed establishing an advertising program, he said, and might eventually be interested in a proprietary line of tires, ``if we can develop enough volume.''