NORTH WALES, Pa. (Aug. 15, 2002)—Treadways Corp. is expanding the distribution reach and practices of its Laramie Tire division, taking on the Dunlop and Goodyear brands after agreeing to become a G3 Xpress wholesale distributor for Goodyear.
Laramie, part of Treadways since 1996, has begun stocking Dunlop brand tires at all 14 of its distribution centers, while Goodyear brand distribution is limited for now to six of the centers—two in California and one each in Colorado, Georgia, Illinois and Missouri—according to Jim Hannon, vice president, sales and marketing for Laramie Tire.
The agreement represents a “significant” increase in Laramie's business and will require a measurable investment in new delivery trucks and personnel, Mr. Hannon said, as the company needs to contact hundreds of new accounts and pitch them on the benefits of the G3 program.
Laramie plans to move six of its distribution centers in the next few months to larger warehouses to accommodate the added business. Among them is the Norristown, Pa., warehouse, which will be combined with Treadways' corporate headquarters staff from North Wales, Pa., in a new facility under construction in East Norton, Pa. The move should take place by the end of September.
“Something like 60 percent of the passenger and light truck business in this country is major branded,” Mr. Hannon said. “We weren't in a position to go after this business until now.”
Laramie already is scouting out new territories where it currently is not active for expansion with the Dunlop and/or Goodyear brands, Mr. Hannon said.
Goodyear and Treadways/Lara-mie were in discussions for about five to six months about the G3 Xpress program.
For Goodyear, the deal reflects its efforts to increase the distribution network for the Dunlop brand.
At last year's Goodyear dealer meeting in Las Vegas, company executives declared their intention to double Dunlop's aftermarket share over three years. Signing up new dealers is key to fulfilling this goal, executives have said.
Goodyear launched G3 Xpress in the fall of 2001, looking to take advantage of independent wholesalers' ability to deliver tires more efficiently and economically to small accounts.
Prior to this announcement, Goodyear said it had signed 41 independent wholesalers as G3 Xpress distributors and had 850 participating retail dealerships.
The program is open to Goodyear authorized dealers and associate dealers ordering less than $300,000 but more than $50,000 worth of tires from the company annually.
Becoming a G3 Xpress distributor will put Laramie in much more direct contact with retailers, Mr. Hannon said, which also opens up opportunities for the Laramie brand. “We expect to generate new business by offering dealers an integrated product screen combining the Dunlop and/or Goodyear brands with Laramie,” Mr. Hannon said.
Prior to this, most of Laramie's business was through other distributors, he said.
For now, Laramie will offer the Goodyear brand though its distribution centers in Stockton and Rancho Dominguez, Calif., Denver, Ellenwood, Ga., Rockford, Ill., and Kansas City, Mo. Other territories may be added once business starts operating smoothly at these locations, Mr. Hannon said.
Of these six warehouses, the two California locations are scheduled to move in the coming months to new facilities twice their size.
Laramie's other stocking points are in Ocala, Fla.; Southhaven, Miss.; Albuquerque, N.M.; Columbus, Ohio; San Marcos, Dallas and Houston, Texas; and Norristown. Of these, Laramie plans to move Florida distribution to Orlando and move the Dallas and Houston warehouses to larger sites.
The G3 Xpress deal solidifies Treadways' relationship with Goodyear, which is the manufacturer of the company's Laramie, Jetzon, Telstar and Centennial brands. The latter has been part of the portfolio since May 2000, when Goodyear unveiled G3 Xpress and was looking for a distributor for the brand.