AKRON—1999 proved to be a disappointing year for Bandag Inc. The company lost 49 franchisees, and restructuring costs sent its net earnings tumbling 11.8 percent to $52.3 million. Despite those setbacks, some of Bandag's large franchisees expressed optimism over the launch of new retreading equipment and sales training programs for 2000, which the company announced in February at its dealer conference in San Francisco.
All franchisees interviewed by Tire Business felt this year's dealer meeting was upbeat. Peter Gerry, president of Pete's Tire Barn Inc. in Orange, Mass., said he thinks the industry soon will see Bandag marketing more of its programs to stay ahead of the competition—something it never had to do before as the retread market leader.
"Bandag needs to flex its muscles," Mr. Gerry said. "They haven't really crowed about some of the things they do better to control their market share. Now they need to do that."
Mr. Gerry noted that Bandag's remaining franchisees are growing and will continue to give the company a majority share in the retread market.
John Snider Jr., president of Snider Tire Inc. in Greensboro, N.C., said he was impressed with Bandag's new machinery: the Model 5400 OSM Tire Builder, the 7400 INSIGHT Casing Analyzer and the Model 6400 Extruder.
In the past, Bandag typically has introduced an updated version of an existing machine or a new machine, Mr. Snider said, but this is the first time in his memory that the company simultaneously released three brand-new pieces of equipment.
"I think they have a lot of positive things to show, both from an equipment standpoint and also from a training standpoint," he said.
Ed Betz, vice president of Service Tire Truck Centers in Bethlehem, Pa., said his dealership is most interested in the Model 6400 Extruder, which he called "one of the best."
The extruder can save time and money because it puts cushion on a tread, eliminating the need to stock different widths of cushion, Mr. Betz said. The machine also automatically fills in skives, which currently is done manually, he said.
Two retreaders—J.D. Chastain, president of Phoenix-based Redburn Tire Co., and Tom Schumacher, president of Chicago Bandag Inc., noted the equipment roll-out was probably a response to increased competition in the marketplace.
"I think it's like any other industry. Unless your competitors force you to, you don't pull anything off the shelf unless you have to," Mr. Schumacher said.
Michelin Retread Technologies Inc., which has aggressively signed several Bandag franchisees since 1997, is one competitor that offers shearography technology through its Casing Integrity Analyzer and an extruder that fills skives.
Redburn Tire may purchase Bandag's casing analyzer, which uses shearography, but Mr. Chastain said the firm will wait and see if the machine will fit into the system at his shops.
"Bandag normally has excellent equipment out in the field, and it's just a matter if it's cost-effective for the units you're running per day," he said.
Bandag also is rolling out a sales training program this spring at its headquarters in Muscatine, Iowa, called the College of Sales to train both novice and veteran salespeople in fleet account sales.
Mr. Snider said he likes the fact that the program begins training new employees at their dealerships before they arrive in Muscatine for further instruction.
"I think that it gives a new person that we would hire a good start toward being successful in sales," he said.
Tire industry salespeople now carry laptop computers containing vast amounts of technical information on retreads and their applications, Mr. Gerry said.
In the past, salespeople would call in with technical questions, he said, but now they have all that data at their fingertips. A salesperson not only needs to know how to access those answers on his computer, but also must know how to give virtual tours of retread shops that customers can't visit, he said.
"Everything's getting more technical," Mr. Gerry said, "so everybody's doing more training."
Mr. Schumacher thinks Bandag's training program "is on target" but the company needs to expedite it as quickly as possible. He said he likes Bandag's decision to hold classes in Muscatine so that salespeople can share ideas.
Mr. Chastain said he would send some of his employees to the College of Sales and "see if it's worth it."
"Bandag's had all sorts of different programs over the last three or four years, some good and some bad," he said. "Hopefully, this will be one of the good ones."