AKRON (Oct. 24, 2001)—As tire retailers—independent or otherwise—throughout North America grow and build market clout, buying and marketing groups are gaining more and more converts as well.
Led by American Car Care Centers Inc. (ACCC)—which is adding eight to 10 new dealer members a month—marketing/buying groups keep broadening their product and service offerings to solidify and expand their membership ranks.
ACCC's growth has brought it to 1,015 member dealers outlets, according to ACCC President and COO Len Lewin, and even with the ebb and flow of membership, the 12-year-old group likely will end up the year exceeding the current total. The group, founded in 1989, also includes 19 member distributors who are shareholders in the company.
Memphis-based ACCC distributes Michelin, BFGoodrich, Uniroyal, Continental, General, Guardian and Nankang tires in addition to its own American Radial brand. Collectively, ACCC members are expected to handle about 15 million units this year, amounting to nearly $1.9 billion in sales, Mr. Lewin said.
Contrary to the industry at large, he said, ACCC member sales were running well ahead of the previous year prior to September. Sales did fall off immediately following the Sept. 11 terrorist attacks on the U.S. Nevertheless, “we're very confident that we're going to finish the year well ahead of last year's totals,” he said.
During last fall and this past spring, ACCC launched its first national advertising campaign, using the theme, “Five reasons to choose us (American Car Care Centers) for your tires” and promoting ACCC dealerships as “the right choice for the right reasons.”
The “five reasons” as depicted in the ads were five children—there to remind motorists of just how much is at stake in maintaining their vehicles and tires in safe working order.
“We've continued to build on that theme and also have had a number of local ads based on it as well,” Mr. Lewin said. One ACCC member, Summit Tire of Brockton, Mass., substituted five local children in adapting the print and TV ads to the dealership's marketplace, running a contest to determine which youngsters would be selected.
Meanwhile, about 250 dealers and their spouses are expected for an ACCC gathering in Las Vegas Oct. 29, prior to the Specialty Equipment Market Association/International Tire Expo in that city.
ACCC also will host a Caribbean cruise for members in January, at which the company's marketing program for the next 12 months will be unveiled. To date, about 360 dealers have signed up, Mr. Lewin said.
One of ACCC's member distributors—Am-Pac Tire Distributors Inc. in Simi Valley, Calif.—has franchised its Tire Pros retail concept and expanded it in the past year by 71 stores to 227 outlets in 11 states, all of which are ACCC locations. Am-Pac still owns 15 Tire Pros locations in California.
Am-Pac, a wholly owned subsidiary of Japan's Itochu Corp., has stated in the past its goal is to have 500 Tire Pros franchise locations. To that end, the company bought two major regional wholesalers in 2000—Tasco Distributing Ltd. in Texas and Southern Rubber Co. in Alabama—boosting its reach by dozens of dealership locations.
The newest of the marketing groups— the T3 Certified Tire Centers progam operated by TCI L.L.C.—has experienced growth double what TCI management envisioned when it launched T3 in October 2000. The number of T3 sites since then has grown from a handful to more than 250 with at least 20 more due to convert before year-end, the company said.
TCI—a wholly owned subsidiary of Michelin North America Inc.—offers small dealerships the Michelin Americas Small Tires line-up of Michelin, BFGoodrich and Uniroyal tires along with the Trivant private label program, as well as a basket of marketing support and business service offerings.
In the Upper Midwest, St. Cloud, Minn.-based Royal Tire Inc. has added 16 stores to its 210-outlet Tire One marketing cooperative, and Durand, Wis.-based Bauer-Built Inc. has doubled the size of its Tire Shop retailer program to more than 150 outlets.
Both programs were created in the past few years to bring together relatively small dealers who are wholesale customers of Royal Tire and Bauer Built. Brand offerings under Bauer Built´s Tire Shop program include Michelin, Bridgestone, Firestone, Kumho, Seiberling, Merit, Signet Mastercraft and General brands.
Royal Tire offers its Tire One customers a choice of Bridgestone, Goodyear, Michelin and Toyo, along with Hankook's Aurora and Cooper Tire's Mastercraft brands.
Elsewhere, Northwest Tire Factory Group shows a net gain of nine stores over a year ago, to 144. Among the new Tire Factory additions is Bruneel Tire and Auto Service Center, an 11-store chain in Idaho and Washington.
For the coming year, Northwest Tire Factory is targeting growth into California now that it has regained marketing rights to the Tire Factory name in that state.
Bloomington, Minn.-based Universal Cooperatives Inc., a farm supply co-op, has expanded its 31-year-old Mr. Tire program to 90 outlets in 13 states in the Mississippi Valley. Mr. Tire offers dealers a choice of eight brands, including its own Goldenmark and Co-Op lines, along with national road hazard warranty coverage and support for a variety of automotive services.
Tire Shop, the associate dealer program of Durand, Wisc.-based Bauer Built Inc., doesn't compare with the industry's larger marketing organizations in sheer numbers of dealer members, but it certainly is among the fastest growing.
The two-year-old marketing group, made up solely of Bauer Built's wholesale clientele, has seen its membership swell by more than 138 percent in the last 12 months. Tire Shop appears well on track to reach its goal of 200 members—and possibly by year's end, said Bauer Built's president, Jerry Bauer.
A similar marketing program, this time aimed at Bauer Built's farm tire customers rather than retailers, also is planned and could become a reality within months, he said.
Tire Shop was formed to provide a common marketing umbrella for smaller retailers in the Midwest, many of whom lack the purchasing volume necessary to take part in organizations such as ACCC or Bridgestone/Firestone Inc.'s Starz program, he said. Tire Shop brand offerings include Michelin, Bridgestone, Firestone, Kumho, Seiberling, Hercules, Merit, Signet, Mastercraft and General.
However, Tire Shop members—like their counterparts in larger programs—share such things as common signage and other identification, a volume bonus on purchases, co-op advertising, point-of-sale and other advertising materials, a road hazard warranty, an auto parts rebate program and a purchasing discount on uniforms.
Most members of the group are in Wisconsin, Nebraska, Iowa, North Dakota, Minnesota and Michigan's Upper Peninsula. Meanwhile, the program is moving into Illinois and Indiana, where recruitment efforts will begin in earnest next March with the opening of a 58,000-sq-ft. Chicago facility that will house a wholesale warehouse as well as a commercial tire shop and Michelin retread shop.
Tire Shop is coordinated by Larry Hildebrandt, Bauer Built's vice president for non-commercial products and wholesale operations.