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July 05, 2004 02:00 AM

New market study long overdue

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    Do you remember the Stern Report, the well-known tire industry market study commissioned by the National Tire Dealers & Retreaders Association back in 1983?

    Named after its author and researcher, Professor Louis Stern, the study helped define the future for the independent tire dealer and provided guidance to the association in how it could best help its tire dealer members prosper in an ever-competitive marketplace.

    Well we're long past due for an update of this landmark study.

    Phil Friedlander Jr., the retired executive vice president of the NTDRA, said as much during his last year in office. In a speech in 1996, he urged the association to conduct a second market study for its members.

    ``There is no other place an independent tire dealer can get a view of the marketplace and the industry which is not colored by a tire company, private brand or other manufacturers in the auto and tire industries,'' he said. ``I would urge that this be a major consideration as early as 1997 but no later than 1998.''

    Today's tire dealers could use another unbiased study on the tire market to help them prosper in the future. And today's successor to the NTDRA, the Tire Industry Association, could benefit from conducting such a valuable study for its membership.

    Think about the importance and insight of one key finding of Mr. Stern's research. He determined that small independent tire dealerships would need to combine their purchasing and marketing operations in an effort to gain economies of scale to remain successful in the increasingly competitive marketplace.

    That was a time when there were few tire dealer marketing groups like today. And he was right on.

    As a story in this issue of Tire Business points out, most tire dealers today belong to either a buying group or marketing program-in some cases both. These groups have helped dealers retain their position as the primary distribution channel for replacement tires in North America.

    In fact, so many dealers have joined these groups that one organization in Canada is openly soliciting members from competing groups as a way to grow.

    A lot has changed in the North American tire business since 1983. Many tire companies that operated back then no longer exist, having been acquired in the wave of mergers that took place in the late 1980s and early 1990s.

    The retread industry has fewer players and tire dealers face a slew of new competitors in the retail and commercial segments as the entire industry becomes more global and fast-paced.

    That's all the more reason why a new marketing study is needed. TIA should do that for its members.

    Letter
    to the
    Editor

    Do you have an opinion about this story? Do you have some thoughts you'd like to share with our readers? Tire Business would love to hear from you. Email your letter to Editor Don Detore at [email protected].

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