Sooner or later, every tire dealership has to deal with an overly demanding customer. But how about one that requires a tire replacement every few months, numerous retreadings on one casing and a multitude of tire repairs?
That type of customer is the waste hauling industry-a target market that has profit potential for tire dealerships that can provide a full package of services.
``The waste industry is one of the most demanding applications that we, as a tire manufacturer, know of,'' said Michael Burroughs, Michelin North America Inc.'s product manager for commercial truck tires.
``It's the most demanding tire fleet in the industry for service,'' added Jack Neece Jr., owner of Neece Truck Tire Center in Tallahassee, Fla.
So why would tire dealers want to get involved with waste hauling accounts?
With no pun intended, waste haulers routinely trash their tires. A garbage truck tire has a life expectancy of about three months-if it can endure the onslaught of punctures and chips-but the casing can be retreaded as many as five times due to the low mileage on it.
``You sell tires for an 18-wheeler, which expects to get 100,000 miles on a steer axle and 300,000 on a drive axle, and you don't see them for quite awhile,'' said Guy Walenga, Nashville, Tenn.-based Bridgestone/Firestone's (BFS) engineering manager for North American commercial products. ``With refuse tires, you sell the same 10 tires but you see them for retreading every 120 days and for a lot of repair work.''
Sooner or later the damage to the tires is beyond the scope of retreading and they have to be replaced with new tires.
``We sell more tires in that industry than others,'' Mr. Walenga said. ``It's good repeat business.''
``The biggest mistake we see is that waste haulers are lumped into the mixed service industry. It needs to be viewed as an industry unto itself,'' said Bethann Barchalk, Goodyear's marketing manager for mixed service tires.
Generally, garbage trucks spend 90 percent of their service life on highways and roads and 10 percent in severe service at landfills.
``It's unique to the whole mixed-service industry,'' she said, noting that the mixed-service designation also pertains to more off-road industries, such as construction, logging and mining.
With the constant stopping and starting at each house throughout a city, the scraping against concrete curbs, the heavy loads and, if they drive into landfills, the propensity for punctures, the wear and tear on the tires-also known as high-scrub use-takes its toll.
``They consume more tires than all the line-haul industry combined,'' said Mr. Neece. A drive tire usually lasts about two months, he added, and a steer tire lasts about three months.
``It's a lucrative retreading market,'' Michelin's Mr. Burroughs said. ``It's a significant business opportunity to be had. It's an equally strong and robust opportunity for the service business,'' such as tire maintenance and inflation pressure checks.
``Because of the number of times the tires are retreaded, it's a good market for retreaders and tire dealers,'' said Bob Morris, director of commercial operations at Sullivan Tire Co. in Norwell, Mass. ``They require a lot of service. It generates a lot of business.''
Waste hauling accounts for about 10 percent of Sullivan Tire's commercial business, but it's a viable market for the company, Mr. Morris said, since there are not a lot of line haulers during the cold Northeast winters.
``Waste hauling is a steady business. It's the second largest market here,'' he said.
The dealership conducts routine checks of the fleets' tire air pressures and provides emergency on-site service, tire repairs and retreading-an important part of the tire maintenance for the fleets. ``Waste haulers expect multiple retreads.... Their criterion is the number of retreadings per casing they can get,'' he said.
Some large waste hauling companies handle their tire maintenance in-house; some outsource. ``It's a mixed bag,'' Bridgestone/Firestone's Mr. Walenga said.
Servicing waste hauler fleets isn't for everyone. ``It takes someone who really wants to provide service for the customer,'' said Mr. Neece, who added that if the account is managed properly, it can be profitable.
His dealership has been involved with waste hauler service for the past seven years and he earns his revenues based on every hour the trucks are up and running.
The contracts include new tire sales, air pressure checks and inspections twice a week, tire repairs and retreading.
``Service is where the profit comes from,'' he said.
Mr. Morris believes larger tire dealerships with multiple locations, service trucks and a retreading shop are better equipped to handle the demands of the waste hauling accounts.
There also is a lot of paperwork involved with the large accounts. Dealers have to maintain an inventory of unique tire sizes and a large stock of casings, according to Mark Bierman, sales manager for Cross-Midwest Tire Inc. in St. Louis.
He noted that retreading, repair and tire service are all customized by the fleets' individual needs. ``You are always working on a low budget,'' he said.
How much profit is generated varies.
``There's a lot of pressure on the waste industry to keep costs down,'' Mr. Morris said.
So fleets are always looking for ways to reduce their tire costs.
``You learn how to be efficient and still make a good gross profit,'' Mr. Morris added.
Some tire dealerships provide in-house training for technicians handling the waste hauling accounts.
``Some accounts have a special way of how they want things done. There is very extensive management,'' Mr. Neece said.
Individual company preferences also extend to the use of tire sealants and the fairly new wide-based single tires-dubbed ``super singles''-that replace dual assemblies. Some waste companies are using sealants in their tires and some are testing the wide-based singles. Generally the industry still seems cautious about embracing these technologies, according to some tire dealers.
Mr. Morris said Sullivan Tire's Waste Management Inc. account wants sealants put in all its tires to seal punctures as they occur. This in turn reduces the number of repairs needed.
Does this cut into the dealership's revenues? ``We put the sealant in, so it's a wash,'' he said.
BFS, which doesn't offer sealants, said there is a tendency for fleets to become complacent when using sealants in their tires.
``They depend on it to handle all punctures, and they stop worrying about it and stop looking for it,'' Mr. Walenga said. Without inspecting the tire for damage and repair, objects left in the tire can cause internal damage or moisture can seep in and damage the steel belts.
Goodyear, which introduced its DuraSeal built-in sealant in January, recommends taking objects out of the tires but otherwise claims the internal sealant seals punctures up to a quarter-inch in the tread and doesn't require repairing until the tire is ready for retreading.
As for the wide-base single tires, Michelin is promoting its new X-One line for the waste hauler industry, claiming it offers significant carrying capacity, multiple retreadings on the drive axle, improved stability and fuel efficiency, and increased air flow over the brake pads, which often overheat from the trucks' constant stopping.