Tire dealers who want to succeed in today's competitive environment must outperform huge retailers by operating better stores and ``go beyond the ordinary'' to satisfy customers.
That's what dealers heard from Target Tire Co. Chairman Bucky Stein during the distributor's annual meeting, Jan. 23-25 in Charlotte, N.C.
Summarizing recent trends in the tire industry, Mr. Stein reminded dealers that exceptional customer service is how dealers can compete against big tire retailers such as Les Schwab Tires Inc., Discount Tire Co., TBC Corp.'s retail empire and muffler shops that sell tires.
Mr. Stein also reminded dealers that interest rates are at the lowest levels in decades, and dealers who haven't renegotiated their bank loans should do so soon. He urged them to deal with banks with the same attitude they would in negotiating the best purchase price from Target Tire.
``Some of you may recall the talk I gave years ago when I said too many small business owners have a misconception when dealing with a bank,'' Mr. Stein said. ``Many feel intimidated when going to borrow money. I want to repeat what I said before-the bank's money is no different to them than tires are to you.''
Approximately 650 attendees came to the meeting, which also included presentations from Pat Croce, former owner of the Philadelphia 76ers. He spoke on how he succeeded in life and business by rejecting people's negative assertions that he couldn't do something while proceeding to achieve his goals. Larry Morgan, president of the Tire Industry Association, also appeared and gave a ``terrific presentation'' about how tire dealers can create value in their businesses, said Target Tire President Howard Stein.
Howard Stein brought dealers up-to-speed on the state of Target Tire. To become more efficient, the company installed a warehouse locator system in the past year to help track inventory and enable the distributor to hire part-time help that requires minimal training, he said. Target Tire also is in its second year using a routing system that tracks the productivity of its drivers, he said.
The company announced that it has enhanced its Web site to give dealers wider access to ``real-time data'' on their accounts and will be making a big effort this year to encourage dealers to order more products from Target Tire online, Howard Stein told Tire Business.
One goal Target Tire has set for 2004 is opening a distribution center in Florida to service dealers in that state, he said.
``We've been down to look at the Florida markets and have had some analysis done of the various markets and have looked at real estate with the idea of buying a location,'' Mr. Stein said. ``We've actually made an offer on a building in Jacksonville, but it probably won't work out because it's too much money. Jacksonville, I think, is where we want to be.''
Mr. Stein said he anticipated having a 60,000-sq.-ft. distribution center in Florida by year-end. He said Target Tire, which currently does no significant business in Florida, will focus on servicing a 75-mile radius around the future facility.
``(Florida) seems to be the one that makes the most sense to us at this time,'' Mr. Stein said, adding that Target Tire is focusing on that area only for expansion.
Target Tire currently operates 11 warehouses-in Georgia, North and South Carolina, Tennessee and Virginia-and handles 14 major and private brands, according to its Web site. The company, which is an American Car Care Centers Inc. distributor for the region it covers, reports annual sales in excess of $100 million.
Sales in 2003 rose ``minimally'' from 2002, Mr. Stein said, adding that Target Tire was ``plagued by gray market problems last year.'' He noted that gray market tires coming into the wholesaler's marketing area in late 2002 and the first three quarters of 2003 ``wreaked havoc'' on the firm's Michelin and BFGoodrich sales.
``Our sales were greater than they were the previous year, but we saw less growth than we had hoped for,'' he said, adding that the people responsible for the gray market problem seemed to be addressing it this year because the problem had diminished.
Mr. Stein called the Charlotte meeting a success and noted that Target Tire's annual tire sellathon during that weekend set a record of 142,000 tires sold. At its evening banquet, Target Tire gave away $50,000 in cash prizes, raffled off a Harley-Davidson motorcyle and raised almost $30,000 for Alliance for the Children, a charity founded by the late Chicago Bears football star Walter Payton.
The company also announced that it will take its dealers on an incentive trip to Napa Valley, Calif., in May to visit Mario Andretti's winery, as well as a trip to Maui, Hawaii, in 2005.