LAKELAND, Fla. (Nov. 5, 2002) — Long-time Goodyear dealer Mike McGee did not start out early in 2001 planning to add six stores to his nine-store McGee Tire Stores dealership, but when opportunities came knocking, he didn't ignore their call.
It started in March, when Monterey Tire & Auto Center, a Goodyear dealership in Stuart, Fla., came on the market when owner Matt Schenier decided to retire. The deal was closed and Monterey Tire became a McGee Tire outlet.
As the year progressed, Mr. McGee, president of the 25-year-old dealership, determined his retread plant was ripe for expansion, so he located new property in Lakeland for the firm's headquarters and commercial tire outlet, freeing up space at the retread plant at a Lakeland area business park for expansion.
"It was the best thing we could have done," Mr. McGee said of the move in October to the 12-acre site near Highway 98. "Our drive-up traffic quadrupled after the move."
As that project moved forward, Mr. McGee became aware of another Goodyear dealership in McGee Tire's marketing area that was for sale—Tech-Master with stores in De Land and Daytona Beach. Gary Griffin, the owner Tech-Master, agreed to stay on with McGee after the deal closed, and he has helped make the consolidation go more smoothly, Mr. McGee said.
In December, another Goodyear dealership, the two-store Fleisner Tire in Venice, Fla., was put up for sale following the death of its owner, John Fleisner. Mr. Fleisner's widow, Pam, continues to work for Mr. McGee at McGee Tire's headquarters in Lakeland.
"The fact that these were Goodyear dealers made the acquisitions easier," Mr. McGee said, noting that inventory transferred relatively easily and the stores' computers already were linked to and compatible with Goodyear's systems.
The acquired stores are all leased locations, he said, helping keep the transaction costs in line.
Largely as a result of the purchases, McGee Tire's sales shot up 28 percent last year over 2000 and are on target to increase another 10 percent this year to more than $29 million.
"Last year was a banner year, sales-wise," Mr. McGee said, "but the costs associated with the purchases meant profits didn't keep pace. Now we're working on making the new stores make money as well."
Despite the new store additions, retail still is not McGee Tire's primary business.
With a growing retreading business in Lakeland, commercial tires represent the dealership's No. 1 revenue source, accounting for 43 percent of sales last year. And becoming a G3 dealer last year has meant the company's wholesale business shot up, to 16 percent of sales from 5 percent the year before.
The commercial business will get a boost in the coming weeks with the opening of a commercial tire center in Tampa, where McGee Tire took over the lease on a building formerly used by United Parcel Service. The building sits on a four-acre site and the site will help the dealership continue to build its network of service sites along Florida's Interstate network.
On the retail side, McGee Tire concentrates on direct mail advertising, Mr. McGee said, in order to stay out of the price wars that dominate local newspaper advertising. Next year the company will venture into television advertising for the first time, he said.
Mike McGee's father John started the dealership in 1974 as an OK Tire Store in Lakeland, selling mostly Michelin products. In 1979/'80 the McGees switched to Goodyear.
The elder Mr. McGee retired in 1990, but the dealership remains a family affair, with Mike's brother Terry McGee serving as vice president, sister Cindy McGee is secretary/treasurer, sister Peggy Waters oversees the wholesale business, and brother John McGee Jr. is in commercial sales.