Skip to main content
EVENT TRACKER
Keep track of rescheduled, canceled industry events with our COVID-affected event tracker - Powered by Snap Finance
Close
Sister Publication Links
  • Rubber & Plastics News
  • European Rubber Journal
tb-logo
Subscribe
  • Login
  • Register
  • Subscribe
  • News
    • OPINION
    • CORONAVIRUS
    • AUTO INDUSTRY
    • BUSINESS/FINANCIAL
    • COMMERCIAL TIRE
    • FACTORY FIXES
    • GOVERNMENT & LAW
    • INTERNATIONAL
    • MOTOR SPORTS
    • NEW PRODUCTS
    • RETAIL TIRES
    • SERVICE ZONE
    • SEMA/AAPEX
    • SMALL BUSINESS
    • TIRE MAKERS
    • SPONSORED CONTENT
    • A year later, pandemic's full tire industry impact unclear
      Tire Cologne canceled; rescheduled until 2022
      New round of Paycheck Protection Program funding opens
      Vaccine may usher sense of normalcy
    • DTM switches horses mid-stream; awards race tire contract to Michelin
      Icahn Auto trims fiscal 2020 operating loss despite 14% lower sales
      Oshkosh unit gets contract for new USPS local delivery vehicle
      Sumitomo adds treadwear-detection to 'Sensor Core' toolkit
    • 4 Wheel Parts celebrates 60th anniversary with deals, promotions
      CarAdvise partnering with RepairSmith mobile repair services
      Goodyear to raise prices by up to 8% on all passenger tires on April 1
      Point S posts strongest year ever in sales profit, growth, store growth
    • TRAC Intermodal redirects retread biz 100% in-house
      Giti rolling out range of GT Radial-brand urban/regional truck tires
      Conlan Tire buys BestDrive locations in Ark., Okla., Texas from Continental
      Michelin upgrades 2 lines of Energy-branded truck tires
    • USTMA joins coalition supporting passage of Equality Act
      McMahon's Best-One increases its minimum wage to $15
      Oshkosh unit gets contract for new USPS local delivery vehicle
      Conti recalling 94,000 Conti-, General-, Barum-brand LT/SUV tires
    • Goodyear names Patterson to lead Cooper integration efforts
      DTM switches horses mid-stream; awards race tire contract to Michelin
      Sentury's 10-year global expansion strategy will include plants in North America, Europe
      Rebound in car tire demand drives USTMA market forecast for 2021
    • DTM switches horses mid-stream; awards race tire contract to Michelin
      Bridgestone World Solar Challenge canceled due to pandemic restrictions
      Pirelli, Goodyear ink sedan racing series contracts in Canada, Europe
      Goodyear extends partnership with Nürburgring race circuit
    • Giti rolling out range of GT Radial-brand urban/regional truck tires
      Milestar Weatherguard AS710 to be made in Tennessee
      Michelin upgrades 2 lines of Energy-branded truck tires
      Falken revamps winter tire lineup with studless Eurowinter products
    • 4 Wheel Parts celebrates 60th anniversary with deals, promotions
      A year later, pandemic's full tire industry impact unclear
      Milestar Weatherguard AS710 to be made in Tennessee
      New Nexen Tire Garage offers dealers digital resources
    • Pennzoil offering carbon-neutral lubricants for passenger cars
      Washington dealership uses new-school solution for recruiting auto techs
      Marinucci: Customers may ignore dangerous conditions
      Automotive Lift Institute introduces Check360 inspection, label
    • TIA seeking nominations for Tire Industry Hall of Fame
      SEMA survey shows resilient auto aftermarket in 2020
      SEMA scholarships and loan forgiveness now available
      WTC hosting webinar Jan. 20 on load-capacity standards
    • SEMA survey shows resilient auto aftermarket in 2020
      Trade groups oppose minimum wage increase proposal
      New stimulus package fixes PPP loan confusion
      Vaccine may usher sense of normalcy
    • Goodyear names Patterson to lead Cooper integration efforts
      Giti rolling out range of GT Radial-brand urban/regional truck tires
      Milestar Weatherguard AS710 to be made in Tennessee
      New Nexen Tire Garage offers dealers digital resources
    • Sponsored By Yokohama Tire Company
      7 questions to ask consumers when they need tires for a crossover SUV
      Sponsored By Yokohama Tire Company
      Stocking Tires for Crossover SUVs
      Sponsored By AppointmentPlus
      Three Important Lessons Learned for the Tire Business During a Pandemic
      Sponsored By Yokohama Tire Company
      7 questions to ask consumers when they need tires for a crossover SUV
  • SHOP FLOOR
    • BALANCING
    • DEMOUNTING
    • SAFETY
    • TIRE REPAIR
    • TPMS
    • TRAINING
    • VEHICLE LIFTING
    • WHEEL TORQUE
    • Video: Balancing Tire
      Safety tips for wheel balancing
      An introduction to wheel balancing
      Wheel weights: Balancing form with function
    • Video: Demounting
      Tire changer types, tips and trends
      How to clear rim rust and corrosion
      An introduction to demounting, mounting and inflation
    • Video: Safety
      Customers
      Considerations for shop safety policies
      Introduction: Creating a culture of safety
    • Video: Tire Repair
      Essential tools, materials and equipment for tire repair
      An introduction to tire repair
      How to properly patch a puncture
    • Video: TMPS Service
      The life-saving work of TPMS
      An introduction to TPMS service
      The importance of proper relearn procedures
    • Video: Training
      Internship ideas to attract tech talent
      Choosing the right auto service tech school
      Intro: Finding and training technicians
    • Video:Vehicle Lifting
      The gravity of proper lift points
      Safety essentials when using jack stands
      An introduction to lifts and lift safety
    • Video: Wheel Torque
      The importance of torque specifications
      Introduction to proper wheel installation
      Torque check and recheck recommendations
  • Multimedia
    • VIDEOS
    • PHOTOS
    • PODCASTS
  • Events
    • ASK THE EXPERT
    • LIVESTREAMS
    • WEBINARS
    • SEMA LIVESTREAMS
  • Data
    • DATA STORE
  • Resources
    • DIRECTORY
    • CLASSIFIEDS
  • ADVERTISE
  • DIGITAL EDITION
  • Awards
    • Tire Dealer Humanitarian Award
MENU
Breadcrumb
  1. Home
April 14, 2003 02:00 AM

No more 'cracking'

Lisa Aichlmayr
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print

    It may sound like the ending line of a Disney movie, but it may be the only way to get decent margins on tires.

    Lawrence Steinmetz, a consultant with High Yield Management Inc., told attendees at the World Tire Expo that the best way to beat a price war is to believe in the prices you charge.

    ``Customers have to believe that you believe you're going to get that price,'' he said in his keynote address March 27 before an audience of about 200 (see related story, page 10).

    The least effective strategy, he said, is getting embroiled in a price war, which he defined as ``two flaming idiots spitting at each other.'' More businesses go broke trying to compete solely on price, he said, and cutting prices ends up being a ``self-inflicted wound.''

    ``If you're willing to give away products for little or no money, I guarantee people will be willing to take them for little or no money,'' said Mr. Steinmetz, a former professor of management at the graduate school of business at the University of Colorado. He also wrote the book, Nice Guys Finish Last.

    According to Mr. Steinmetz, tire dealers-and all business owners for that matter-succumb to price pressure when they commit two fatal errors: ``wowing and cracking.''

    Wowing

    ``Wowing'' refers to a salesperson implying to the customer that the prices are too high. This gives the unspoken signal to customers that if they haggle, the price will come down. Mr. Steinmetz said a classic sales pitch that does this is: ``Are you sitting down?''

    ``You've just told them your prices are too high,'' Mr. Steinmetz said.

    Other indicators include advertising come-ons that prepare customers for a haggling session. Car dealers, Mr. Steinmetz said, are major culprits. He cited advertisements that lure customers with the prospect that they can drive the price of a vehicle down as low as possible.

    ``Translation: Come on in and let's have a fistfight over price,'' Mr. Steinmetz said.

    Business owners can beat this scenario by having their salespeople record their sales pitches with pocket tape recorders. Later they can point out the clues they gave customers to start haggling over price.

    ``Listen to it, and you might be surprised how much wowing you do,'' he said.

    In fact, the smallest clues can have an impact, Mr. Steinmetz said.

    ``The way you handle your price will largely determine your ability to get that price,'' he said.

    Cracking

    ``Cracking'' is the next step in the price-cutting process. Once salespeople signal that price is negotiable and the customer starts laying on pressure, they are more likely to crack and cut the price. The common lines that show someone is cracking include: ``Let me talk to the boss''; ``Tell me where I need to be''; and ``You know I want to work with you.''

    ``You can't say that to a customer and not expect them to kick your butt,'' Mr. Steinmetz said.

    Another implied signal that a salesperson is ready to crack is when he or she uses an unnecessary adjective to describe the price. These words include ``normal,'' ``regular,'' ``asking,'' ``standard,'' ``list'' and ``special.'' Those adjectives, Mr. Steinmetz said, hint at another, more lucrative price the customer can easily get with some carefully applied pressure. The ultimate culprit? Manufacturer's suggested retail price.

    ``The more you do that, you've suggested to the customer you've got more than one price,'' he said.

    Reynold Hester, owner of Hester Tire Service in Bladenboro, N.C., said he is guilty of cracking.

    ``I crack all the time,'' Mr. Hester said, laughing.

    Gary Ingber, CEO of Open Road Technologies Inc., said cracking is a first response to the fear of customers walking out the door to get a better price from the competition. He said his company, which provides software to retreaders, feels the same pressure as many tire dealers.

    But Mr. Steinmetz said business owners shouldn't be fearful about their prices.

    ``You've got no one to blame but yourself if you're too wimpy to raise prices,'' he said.

    Letter
    to the
    Editor

    Do you have an opinion about this story? Do you have some thoughts you'd like to share with our readers? Tire Business would love to hear from you. Email your letter to Editor Don Detore at [email protected].

    SIGN UP FOR NEWSLETTERS
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please verify captcha.

    Please select at least one newsletter to subscribe.

    Newsletter Center

    Staying current is easy with Tire Business delivered straight to your inbox.

    SUBSCRIBE TODAY

    Subscribe to Tire Business

    SUBSCRIBE
    Connect with Us
    • Facebook
    • LinkedIn
    • Twitter
    • RSS

    Our Mission

    Tire Business is an award-winning publication dedicated to providing the latest news, data and insights into the tire and automotive service industries.

    tb-logo
    Reader Services
    • Contact Us
    • About Us
    • Site Map
    • Industry Sites
    • Order Reprints
    • Customer Service: 877-320-1716
    Partner Sites
    • Rubber & Plastics News
    • European Rubber Journal
    • Automotive News
    • Plastics News
    • Plastics News China
    • Urethanes Technology
    RESOURCES
    • Advertise
    • Privacy Policy
    • Privacy Request
    • Terms of Service
    • Media Guide
    • Editorial Calendar
    • Classified Rates
    • Digital Edition
    • Careers
    • Ad Choices Ad Choices
    Copyright © 1996-2021. Crain Communications, Inc. All Rights Reserved.
    • News
      • OPINION
      • CORONAVIRUS
      • AUTO INDUSTRY
      • BUSINESS/FINANCIAL
      • COMMERCIAL TIRE
      • FACTORY FIXES
      • GOVERNMENT & LAW
      • INTERNATIONAL
      • MOTOR SPORTS
      • NEW PRODUCTS
      • RETAIL TIRES
      • SERVICE ZONE
      • SEMA/AAPEX
      • SMALL BUSINESS
      • TIRE MAKERS
      • SPONSORED CONTENT
    • SHOP FLOOR
      • BALANCING
      • DEMOUNTING
      • SAFETY
      • TIRE REPAIR
      • TPMS
      • TRAINING
      • VEHICLE LIFTING
      • WHEEL TORQUE
    • Multimedia
      • VIDEOS
      • PHOTOS
      • PODCASTS
    • Events
      • ASK THE EXPERT
      • LIVESTREAMS
      • WEBINARS
      • SEMA LIVESTREAMS
    • Data
      • DATA STORE
    • Resources
      • DIRECTORY
      • CLASSIFIEDS
    • ADVERTISE
    • DIGITAL EDITION
    • Awards
      • Tire Dealer Humanitarian Award