LOUISVILLE, Ky.—Ken Towery's Tire & Auto's newest outlet—a 10-bay store in Louisville due to open in November—exemplifies a subtle shift in the company's business strategy: to generate more service-related revenue.
At 10 bays, the new Louisville store—the dealership's 18th—will be able to schedule more service business than in the past, said Vice President Doug Meadows. Most of Ken Towery's older stores have five bays, although some of its newer ones have eight or nine bays.
Mr. Meadows said that future store sizes will depend on location and lot availability, but the dealership would like to build more 10-bay outlets. Otherwise, the dealership has no plans to change its current operations or implement major expansions.
The 29-year-old dealership has been keeping a steady pace in expanding its business, in both outlets and sales. Ken Towery's projects sales this year will shoot up by about one-third to $25 million after rising 20 percent last year to $18 million, from $15 million in 1998.
Retail sales account for 85 percent of the company's total revenues, and more than half of retail dollars comes from tire sales; automotive service accounts for 35 percent, the company said.
As sales steadily increase, the dealership plans to boost its existing market penetration by adding one or two stores per year in the Louisville and Lexington, Ky., areas. Company advertisements running in the Louisville Courier Journal state Ken Towery's is planning new outlets in Lexington, Danville, and Berea, Ky.
However, the dealership has no plans to expand beyond its current "Kentuckiana" markets, Mr. Meadows said.
Ken Towery's has been busy servicing Firestone tire recall customers and competing with new-car dealerships for tire sales.
Mr. Meadows said the dealership combats the growing competition with car dealerships for customers by promoting its large number of outlets and its claim that it "offers the lowest price in town."