LYNDHURST, N.J. (May 5, 2003)—Add automotive aftermarket parts to Englewood Tire Distributors (ETD) Inc.'s product offerings.
The Lyndhurst-based tire re-tail/wholesale dealership became a distributor for Mighty Distributing System of America Inc. on April 1 for the northern New Jersey area. As a result, ETD also has established an auto parts division called ETW Auto Parts Inc. to handle its business from the Mighty partnership.
The deal gives ETD ownership of the former Mighty distributor of that area, a business that generated about $700,000 in sales annually, said Joel Sparling, managing director of ETW Auto Parts and ETD operations director.
“Our experience and knowledge of the northern New Jersey automotive marketplace gives us a very clear edge over anyone else that would come in without that knowledge and relationships that Englewood Tire has,” he said. “It's a very exciting opportunity for us to take some of our existing tire customers that we sell tires to on a wholesale basis…and introduce them to the Mighty program and hopefully make them customers.”
The owner of Mighty's previous distributor for northern New Jersey had reached retirement age and was looking for a replacement, according to Barry Teagle, Mighty's vice president of franchise sales and development.
Mr. Teagle said he contacted John Boyle, president of ETD, presented the business model to him, then helped ETD engineer the purchase of the retiring Mighty distributor's business.
“We were looking for a new distributor and in their case, they developed a need for a new parts program for their stores,” Mr. Teagle said. “They went the next step not just as a solution for their parts needs, but also for their business diversification.”
Mighty has 130 distributors across the country, 15 of which are tire dealers, according to Mr. Teagle.
ETD had been relying on another distributor to stock its stores with auto parts in the past, but decided it could provide the same service to other repair shops and instead recapture the margins its distributor was earning from serving ETD, Mr. Sparling said. Plus, the dealership could gain better control of its own inventory and grow its business.
“It's really a no-brainer for a repair shop owner to allow a stocking distributor to come in and manage his parts needs, because it's just less time he has to spend worrying about whether he has the right oil filter or brake pad,” he said.
Noting that the Mighty program is well-defined and required a minimal up-front investment of inventory, Mr. Sparling said ETD's three-year projection is to triple its wholesale parts sales. The ETW division of ETD equals a “very small percentage” of the dealership's total business, he said, but it's still important. He said ETW has 200 existing customers plus its own retail stores, but there are 500-750 more shops that could become ETW customers.
“Any gas station, quick lube, repair shop, tire dealer could benefit from this program,” Mr. Sparling said. “It's just a matter of taking the time to introduce it to them, letting them consider it…. Most people who take the time to consider it, like we did, will probably do it. It's just a matter of getting to them.”
The company currently is renting the previous distributor's warehouse and will transfer all inventory to its Lyndhurst facility over the course of the year.
ETD operates nine retail outlets in New Jersey under the name ETD Discount Tire Centers and distributes tires through its ETD Discount Tire Express division to New Jersey, Connecticut, Long Island and other parts of New York. The dealership in 2002 took over the American Car Care Centers Inc. distributorship in those areas, which were formerly serviced by Wholesale Tire Co.