American Tire Distributors (ATD) Holdings Inc. is on a growth binge, according to Ron Sinclair, its vice president of marketing.
ATD is pursuing growth via two different avenues, according to Mr. Sinclair. ``The first is growth through acquisitions, of which we've made several in the last couple of years,'' he said. ``The second, in markets where there's not a good candidate for acquisition, is when we start from the ground up, opening an operation in a greenfields situation.''
Founded as J.H. Heafner Co. in 1935, ATD has burgeoned especially since Bahrain-based Investcorp Bank BSC purchased it early in 2005.
In the past 14 months, ATD acquired three regional wholesalers-Samaritan Wholesale Tire Co. of Minneapolis, Jim Paris Tire City of Montebello Inc. in Denver, and the wholesale operations of Martino Tire Co. in Miami-which added the potential for about $120 million in new annual sales.
The company is on target to hit $1.8 billion in sales this year, up about 15 percent over 2006.
For the first six months of 2007, ATD reported a net loss of $481,000, but that was a significant improvement over a $4.81 million loss last year.
As for customer benefits, Huntersville-based ATD claims it offers the widest selection of manufacturer programs of any wholesaler, Mr. Sinclair said. What the company really is proud of, however, are its in-house programs-the ATD ServiceBay marketing strategy, which it introduced last year, and the Tires & More affiliate advertising program it acquired in late 2005 when it purchased Sparks, Nev.-based Silver State Tire Co.
``ServiceBay is the foundation of all our customer programs,'' Mr. Sinclair said. The program is formed into seven different ``bays'' encompassing warranties, credit cards, technology upgrades and other features to help members expand their businesses.
Member dealers may participate in any or all of these bays; participation is determined by total annual purchases of ATD products and annual growth in passenger and light truck tire purchases.
In a little over a year, ServiceBay has attracted some 1,000 participating dealers, according to Mr. Sinclair.
Tires & More, a much smaller program, has 54 affiliated dealers and is ``more about quality than quantity,'' Mr. Sinclair said. ``We have to have dealers who are ready to participate in our advertising program.''
ATD is eyeing new expansions and investments, but he said he wasn't at liberty to discuss them because they're all at a sensitive stage.
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ATD at a glance
* In business since 1935
* Acquired by private equity firm Investcorp Bank BSC, based in Bahrain, in 2005
Going to market
* Operates 76 distribution centers in 36 states
* On target to hit $1.8 billion in sales this year