AKRON (Aug. 18, 2003) — While many tire dealers dread Wal-Mart Stores Inc. entering their local tire markets, Don Hoover has continued to compete with the mega-retail discount chain on its own turf.
He´s sold appliances, lawnmowers, home goods, freezers, TVs, mattresses and guns at Vandalia Firestone & Appliance in Vandalia, Mo., since he bought the dealership in 1977, keeping the items on the rack as other tire stores left those markets. He added furniture in 1991.
Mr. Hoover said the additional items give revenue a boost without the labor costs of tire service, and customers find the one-stop shopping a value without the tire service pitfalls of a large discount chain.
``You´ve got to be a small Wal-Mart to (customers),´´ Mr. Hoover said. ``Be their competition.´´
Other tire dealers contacted by Tire Business also have found success offering non-automotive- related products and services at their dealerships in addition to the usual tires, wheels and automotive accessories. Some said the extra sales contribute to the bottom line and to customer recognition in a notoriously competitive industry.
``You can´t only do repair and service,´´ said Arthur Bradley, president and general manager of Ace Parker Tires Inc. in Sumter, S.C., which also sells used cars and operates a wrecker service. ``...You can´t depend on tires for a living.´´
Mr. Hoover, who like many tire dealers is surrounded by Wal-Mart stores, appreciates the idea of putting a variety of items in one place so customers waiting for their tires to be mounted can browse appliances, or bored spouses can shop for other things.
``What else are they going to do while they put the tires on?´´ he asked.
Years ago, in fact, Mr. Hoover met a young Sam Walton-founder of the colossus company-in an Arkansas dime store. That was in 1968, and Wal-Mart Stores Inc. was incorporated a year later.
``He was telling me about this plan he was putting together, (and I thought) `Oh, he´s full of it,´ but everybody was then,´´ Mr. Hoover said, laughing.
Though he didn´t get in on that business, Mr. Hoover said the extra revenue from various items are good.
``You make money,´´ he said. ``You can sell a set of mattresses and make as much as you get on two sets of tires.´´
Other not-so-mainstream items also can give dealers a revenue boost. Gary Tillery, president of Tire Depot Inc. in San Diego, said he sold $250,000 worth of hard hats made to look like Stetsons about five years ago.
High school friends made the hat, and Mr. Tillery thought it would be fun to sell them primarily through mail order for a little over a year. ``Then it dwindled down,´´ he said of the fad hats that were dead ringers for cowboy hats from 50 yards away.
``It was a nice diversion from the tire business,´´ he said.
While many of the hat customers used mail order-meaning most didn´t come into his shop and later buy tires-the sale gave his shop some exposure through local news coverage.
Though he has not sold other unique items since then, he said he´s open to the idea again.
``If you´re going to be in business for yourself, you have to be innovative and should keep your mind open,´´ he said. ``It´s hard after a couple years.´´
One example of a dealer keeping his eye open for opportunities was the man who bought Mr. Tillery´s father´s former tire shop in Tempe, Ariz. Mr. Tillery said he visited the shop in 1989 only to find it had added horse bridles, saddles and other equestrian equipment to serve customers on a nearby horse path.
Randy Juette, owner of RJ´s Tire & Auto Center in Naches, Wash., has seen a lot of success from propane sales and an RV dump. The former gas station he bought for his first location already sold propane, so he decided to continue offering it, even as he moved to a larger facility.
``Down the road it´s going to sell a flat tire (repair), sell a used tire, maybe...sell a set of tires,´´ he said. ``(It´s for the) long-term relationship.´´
Propane customers include food vendors and local residents, while the RV dump draws travelers visiting Naches, which is in the foothills of the Cascade Mountains. Many of those travelers return year after year, and they return to RJ´s Tire. In addition, they tell others needing tire help about the shop. Mr. Juette also is one of his own best customers-he heats his shop with propane and takes advantage of his buying discount.
Both services easily pay for themselves, he said, and the propane makes up about 5-10 percent of his gross sales. Still, the main benefit is the customer recognition.
``It´s like an alignment machine,´´ he told Tire Business. ``You don´t make money on the alignments, you make the money on the front-end work.´´
Not all dealers turn to non-automotive items in their search for extra revenues.
Ace Parker Tire´s Mr. Bradley has been selling used cars on and off for about 10 years. He´s also added a car wash and wrecker service and is considering building a self-storage unit behind the shop. He said the used car lot plus the towing and wash services contribute to the concept of a one-stop automotive shop.
``If your car´s not worth fixing, go and buy one off my lot,´´ he said, explaining that both the used car and tire businesses cultivate customers for the other.
Mr. Bradley stressed he´s not a high-pressure salesman when it comes to the used cars. He said he views the business as a good way to make some extra cash on a slow day, but he won´t depend on it.
``I don´t have to sell them,´´ he said. ``I just do it for a hobby.´´
Similarly, the storage idea also could help bring in extra sales without much trouble. ``It don´t eat, and it don´t drink, so I don´t need to put electricity to it, and I don´t need to put water to it,´´ he said.
But, he warned, tire dealers considering a used car lot should be careful to inspect the cars first and not sell lemons. While he tries to keep the cars affordable-handling only vehicles ranging in price from about $1,500 to $5,995-Mr. Bradley is careful to check them over.
``If you give one person a bad car, that´s a bad advertisement.´´