AKRON (Sept. 29, 2003)—While many tire dealers hoping to make a splash in the performance market focus on tires and wheels, other aftermarket accessories may also prove profitable, an industry analyst told Tire Business.
Mary-Beth Kellenberger with the research firm Frost & Sullivan Ltd. recently wrote a report detailing opportunities in the sport compact exterior market. She said a later report will cover the tire and wheel aftermarket specifically.
“It's not a passing fad,” she said of aftermarket modifications to vehicles. “It's really an emerging market.”
A new opportunity for tire dealers is selling accessories such as exterior lighting and decorative elements, Ms. Kellenberger said. This corner usually is dominated by automotive retailers, discount chains or speed shops, but there is room for tire dealers to get in on the action.
“There is an opportunity for them to increase their retail business by this,” she said.
According to the firm's research, exterior lighting garnered revenues of about $500 million in 2002. By 2009, that revenue is expected to grow to just over $2 billion.
Ms. Kellenberger suggested dealers commit 8 feet of space in one corner of their showrooms to these accessories where people can browse while they wait for their tires to be serviced. She suggested offering mostly items that cost less than $40—or what most people carry in their wallets.
Some products could include windshield accessories and other accents, neon kits, sport accessories and lighting items. More complicated body panels and spoilers are best left out, she suggested.
Tire dealers also could offer installation of lighting accessories, but that depends on the electrical experience of the company's technicians, Ms. Kellenberger said.
If tire dealers do branch out into offering these accessories, she suggested they team up with a quality distributor that will manage the inventory and offer timely products. In the performance segment, the popularity of items can come and go in as little as six to nine months, she said. The problem is that once an item or color is popular, everyone starts to buy it and then it's not distinctive anymore.
“And it will be dropped like a hot potato,” Ms. Kellenberger added.