LOS ANGELES (July 12, 2002)—Membership rarely comes without benefits. The Los Angeles-based Independent Tire Dealers Group L.L.C. is no different there.
But unlike some dealer groups around the country, the LA group's advantage is primarily financial.
“We're a pure buying group,” said Gary M. Ceazan, executive vice president of the organization formerly known as Tire Factory Group. “We negotiate volume programs for people to participate.”
The Independent Tire Dealers Group has 72 dealer members operating 220 stores in five southwest states plus Hawaii. The program is open to virtually any tire dealer located in California, Colorado, Nevada, New Mexico, Arizona and Hawaii, although Mr. Ceazan said protected areas exist to eliminate competition among members.
Members are privy to volume pricing offered by what the group terms its “strategic partners.” This includes numerous tire makers, along with equipment, parts, wheels and accessories vendors.
Maintaining membership is as simple as buying a minimum of $200,000 in tires from the group's collective vendors during a calendar year. Non-tire related items are not counted toward the $200,000.
Beyond the volume discounts, membership benefits are limited, Mr. Ceazan said, and include available signage and a road hazard warranty program honored by members.
Dealers retain total independence and there are no advertising co-ops of any kind, no store-to-store warranty protection or things of that nature typically associated with dealer groups.
Mr. Ceazan said his group is a member of the much larger Tire Alliance Groupe, a 1,400-member buying group based in California.
Formed in 1995 by a handful of Southern California dealers, the Independent Tire Dealers Group generated $2.5 million in group purchases its first year.
Mr. Ceazan said the group does twice that now monthly. He noted that sales volume has increased by about 35 percent annually the past three years and he expects volume to reach $60 million this year. And by 2005 Mr. Ceazan has his sights on reaching $100 million in combined purchases.
The group recently met in Indian Wells, Calif., for its annual meeting and trade show show, which was attended by 200 members, spouses and vendor personnel.