Without a doubt, the most far-reaching changes on the tire retailing scene in the past year were negative-the disappearance of Penske Auto Centers and Winston Tires' bankruptcy and subsequent breakup.
These two events alone took more than 650 retail outlets out of play. Competitors, though, may view the situation as addition by subtraction.
Take away a few well-documented takeovers-Tire Kingdom Inc. adding 41 stores by acquisition and new startups, Somerset Tire buying up 24 stores or ProCare Automotive taking on 21 stores in one purchase-and the ``usual'' organic growth by Discount Tires and Les Schwab (50 and 27 new stores, respectively), and the past year has been relatively quiet from a mergers and acquisitions point of view.
In fact, 46 of North America's largest 100 independent retail tire dealerships stood pat in the past 12 months, neither adding nor closing stores, and 25 more changed their network by only one store up or down.
A stuttering economy and the uncertainty spawned by last year's Sept. 11 terrorist attacks undoubtedly played roles in the wait-and-see attitude exhibited by these dealerships.
Two exceptions are Certified Tire & Auto Centers in Southern California-growing to 12 stores from eight in the past 18 months, with seven more on the drawing board-and McGee Tire Stores Inc. in Orlando, Fla., growing to 15 stores from nine. (See individual stories in this special section.)
Discount Tire's steady growth and Penske's demise have vaulted Arizona-based Discount to the top of the community of independents. Its 500 outlets are nearly twice that of No. 2 Les Schwab Tire Centers' 272 company-owned outlets and more than twice the 216 outlets operated by No. 3 Tire Kingdom.
Discount Tire also leads the retail sales list, with $1.49 billion in 2001 tire-related revenue, again ahead of Les Schwab ($866.3 million) and Tire Kingdom ($245.9 million). On a per store basis, Discount Tire trails Les Schwab slightly-$3.14 million to $3.18 million-but both trail Hawaii's Lex Brodie's Tire, which reported $4.4 million per store last year.
Of course, when one looks at franchised outlets alongside company-owned stores, TBC Corp. wins hands-down, with 564 Big O Tires Inc. outlets and 216 Tire Kingdom stores.
Among the other Top 10 dealerships: Fountain Tire added six stores; Merchant's Inc. consolidated, closing eight locations; Kal Tire closed or converted four stores to franchise status; and Big 10 Tires added seven stores, bringing its network to 82 stores throughout Alabama, Georgia and Florida.
The disappearance of Penske appears to have had little, if any, ripple effect on the tire retailing community. Although the Kmart-sited dealership operated 625 outlets, the per-store revenue was less than $500,000, which is less than half the average store sales for the 100 leading dealerships, according to Tire Business research.
Regionally, Bridgestone/Firestone continues to command a strong presence, operating the most retail stores in six of the 10 geographic zones tracked, and holding down the No. 2 spot in two more with its Firestone Mastercare, Tires Plus and Expert Tire outlets.
Using Rubber Manufacturers Association data as a basis, Tire Business broke the U.S. into 10 regions that consider both natural geographic boundaries and the territorial spread of the major retailers' store networks. (See charts accompanying this special section.)
Regionally, Discount Tire ranks among the 10 largest tire retailers in five of the 10 geographic zones, the most of any independent dealer. Of those 10 zones, independents are the leading retailers in only two-Big O Tires in the Rocky Mountains and Les Schwab along the West Coast.
By virtue of its takeover of Kimmel Automotive earlier this year, Monro Muffler Brake Inc.'s outlets have become more tire oriented and therefore the company is listed as a competitor for the first time. And right away it becomes the No. 1 competitor, based on store count, in two zones-New England and Middle Atlantic-and is No. 4 in South Atlantic.
While the leading retailers were relatively quiet in the past year, there was explosive growth at several cooperative marketing groups. Among the leaders in growth were:
* American Tire Distributors Inc.'s AutoEdge affiliated dealer program, up about 140 outlets to more than 270;
* Bauer Built Inc.'s Tire Shop affiliate dealer program, up 74 dealer outlets to 224;
* Am-Pac Tire Distributors' Tire Pros franchise program, up 65 locations to 277;
* Universal Cooperative's Mr. Tire affiliated dealer program, up 51 locations to 141;
* Big O Tires' franchise network, up 38 stores to 564 (including Canada); and
* American Car Care Centers' network of affiliated dealers, up 35 sites to 1,050.
In addition, the Tire Centers L.L.C. (TCI) network of T3 affiliated dealers grew by 65 dealerships to 315, and Bridgestone/Firestone's TireStarz network expanded by 120 outlets to more than 660.
TCI, a subsidiary of Michelin North American Inc., opened three warehouses this past summer-in Pennsylvania, New York and Arkansas-to support its drive to open new territories and add up to 100 new dealers before mid-2003. TCI now has 29 distribution centers across the country.
For its part, BFS signed 78 TireStarz dealers in June and July alone. The program has grown to 35 distributors nationwide from one in September 1997 when the program was rolled out.
Tracking the marketplace from a brand perspective, 67 of the 100 largest dealerships carry Goodyear, with 60 carrying Michelin and 52 Dunlop.
However, taking into consideration the number of outlets the respective top 100 dealerships operate, a different picture emerges, with the MAST brands-Michelin, BFGoodrich and Uniroyal-available at more outlets than any other brands. Interesting to note: the Dunlop brand is available at nearly 220 more outlets than the Goodyear brand.
These numbers do not, however, portray what role the brands play at the dealerships where they're sold.
In Goodyear's case, for example, about half of the 67 dealerships that carry the brand are considered key Goodyear dealers-either Goodyear G110 or G3 accounts-who carry few if any other brands besides Goodyear and/or Kelly and/or Dunlop.