The Independent Tire Dealers Group (ITDG) L.L.C., a 9-year-old buying group with 84 dealer members throughout the Southwest, California and Hawaii, is laying the foundation for a new persona.
It's one that will expand the group's scope and reach and create a marketing program that will ally the ITDG's 250 outlets under a common identity.
The group's search for growth possibilities will take into consideration its ties with the national buying group Tire Alliance Groupe Ltd. (TAG), said Michael Cox, president of ITDG since April, when Gary Ceazan retired after three years at the helm. Because ITDG is a member of TAG-and wants to continue to be-its search for growth will be in areas outside of the merchandise range covered by TAG, Mr. Cox said recently.
``We're part of TAG and want to continue to be,'' Mr. Cox said, ``but at the same time we're looking for ways to generate more income for the group. We're not out to cannibalize TAG but to generate additional sales in areas not covered by TAG's product offerings.''
The hiring of Mr. Cox-formerly with Bridgestone/Firestone and Tire Kingdom Inc.-coincided with the relocation of the group's headquarters from Los Angeles to Juno Beach, Fla., where Mr. Cox has lived the past several years.
Besides tires, TAG offers volume buying on wheels, oil, batteries and some auto parts. TAG officials said it's too early to comment specifically on ITDG's plans, but in general concurred that any expansion outside of ITDG's prescribed geographical territory would have to be in products and services that don't compete with those offered by TAG.
Some of the means being considered are a credit card program with GE Capital, a branded wheel program, an exclusive import tire brand and eventually insurance coverage and other services, Mr. Cox said.
``We also want to establish ITDG as a brand,'' he said, noting that creating a common identity among the group's 250 outlets opens up possibilities for more cost-effective advertising and other promotional activities.
At the same time, all of ITDG's members are fiercely independent and want to retain their independence, said Alpio Barbara, chairman of the group and owner/president of Redwood General Tire in Redwood City, Calif.
ITDG has 84 members operating 250 outlets throughout Arizona, California, Colorado, Montana, Nevada, Hawaii and New Mexico, although about 80 percent of the outlets are in California, Mr. Cox said. Among prominent ITDG member companies are: Big Brand Tire of Bakersfield, Calif.; Ramona Tire Inc. in Hemet, Calif.; Rynick Tire & Auto Center in Pleasonton, Calif.; Tire Guys of Hesperia, Calif.; and Western Tire Centers of Tucson, Ariz.
Of the member companies, 43 are considered shareholders, Mr. Cox said. Shareholders anted up $35,000 initially, pay $600 quarterly dues and agree to buy $500,000 minimum through the group, all of which entitles them to a 4-percent rebate at year-end on that year's purchases. More than half the initial sign-up fee is redistributed back to the shareholders.
The group's search for a common identity is actually Round 2 of a search: In late 2001, the group-then known as Tire Factory Group L.L.C.-agreed to adopt the name United Tire Dealers L.L.C. and create a United Tire Dealers moniker. Shortly thereafter, though, it was discovered someone else already had trademarked that name, so the group went back to the drawing board and came up with ITDG.
ITDG began life in 1995 with a handful of partners as the Tire Factory Group; first year sales volume was about $2.5 million. Initially it was allied with the Northwest Tire Factory Group with an eye toward using the Tire Factory market presence, but that idea eventually waned and was abandoned.
The group has grown about 35 percent a year the past several years, generating about $60 million in sales last year. Business should reach $100 million by next year or 2005, Mr. Cox said.
ITDG members apparently do not see a problem with their headquarters being three time zones away, Mr. Barbara said. ``We asked at our last meeting how many had visited the Los Angeles headquarters. More than two-thirds said they hadn't ever been there.''