WINDSOR, Ontario—“The times, they are a-changin'”—and for Santing's OK Tire, that observation has served as a business philosophy for the past 50 years.
“We change with the times and keep up with technology,” explained co-owner David Santing.
While typical tire dealerships expand undercar services to stay competitive, the single-outlet tire business in Windsor opted over the years to diversify into a myriad of products and services, ranging from radiators to rust-proofing.
“We've been through a few economic turnarounds,” said Mr. Santing, whose father, Al, founded the dealership in 1958. He took over the business when the elder Mr. Santing, now 69, retired about five years ago.
“We've been able to adjust quite quickly when the marketplace changes. We recognize change has to happen.”
Santing's has added products and services it felt consumers needed and that weren't available at many locations, he said. Its array of offerings, besides tires and wheels, include radiator and fuel tank services, performance exhaust systems, shocks and struts, transmission cleaning and rust-proofing. “These are little niches in the marketplace we've developed over the years,” Mr. Santing said.
Its most profitable product line is exhausts, followed by a rust-proofing system not available in the U.S., gas tank renewal, vehicle accessories and radiator service. “Where we lose on margins (on tires and wheels), we pick up elsewhere in other departments,” he said.
Retail sales comprise about 65 percent automotive services and 35 percent tires. About 30 percent of the dealership's total sales come from wholesaling products to other shops.
“We're a unique operation,” Mr. Santing admitted, noting the typical tire dealership expands into full mechanical service, such as brakes, to make a profit. “In the back of my mind, I think about getting into brake work and underbody…The challenge is finding individuals licensed to do the work.”
The dealership so far has refrained from offering services that require licensed mechanics. “The biggest challenge is finding and keeping good techs,” he said.
Instead, this year the dealership is considering adding two new products related to fuel and exhaust systems as well as enhancing a couple of its departments. “The products are out there, but nobody is doing a good job with them. They have a lot of potential but they have to be marketed properly.”
The dealership does “a fair amount” of sales to the tuner market, including exhaust systems, performance tires and wheels, and accessories such as air intakes, tail lights, hood deflectors and lowering kits. “If you want to dress up your vehicle front to back, we have it available,” Mr. Santing said.
As for tires, Santing's offers several major brand all-season and ultra-high-performance passenger and light truck tires, ATV, Care Free lawn and garden, Air Boss skid and backhoe, and even some antique tires, as well as tire repair and balancing.
Last year the dealership began offering nitrogen tire fills, and sales have exceeded its forecasts, Mr. Santing said. Now every newly mounted tire is automatically filled with nitrogen and the $5 charge is included in the tire price. About 75 percent of his other customers have converted to nitrogen fill, he said.
The dealership also prides itself in offering quick service and quality workmanship. “We get referrals from other shops because we're capable of doing particular services,” Mr. Santing said.
The business thrives on word-of-mouth advertising and referrals. “Customers are part of our sales force. Our joke is we need to give these people some business cards.”
The dealership generated under $1 million (Canadian) in sales last year, on par with 2006, but it expects to increase sales this year by about 7 to 10 percent. Mr. Santing plans to accomplish this through changes in selling prices and concentrating on new products and new sales, as well as benefiting from marketing the dealership's 50th anniversary this fall.
The golden jubilee is still in the development stages, with plans to advertise in local newspapers and magazines, offer special discounts and possibly get involved in community activities, Mr. Santing said.
The company is able to celebrate this anniversary due to foresight and a willingness to adjust with the times, he noted.
One of the best decisions the dealership made was in 1987, he said, when it joined the national buying and marketing cooperative, OK Tire Stores. “It opened a lot of avenues for us for purchasing products,” he said. His father served as chairman of the group for 13 years.
As for any bad business decisions, Mr. Santing said, “if a decision or direction did not work as planned, we would change.”
Santing's Tire originally began as a passenger tire retreader. Al Santing quit his job at a tire shop and purchased retreading equipment from the owner and took over the site of a former animal hide tanning business in Chatham, Ontario, in October 1958. Equipment malfunctions made for a rough start-up, so during the first year, Al Santing sold retreads to garages, service stations and used car lots by day and worked a second job at night to pay off his debts.
He added new tires to his product mix a few years later and abandoned retreading by 1969. In 1964 he moved the growing business to a larger location with more service bays. He added full tire service, including truck tires, and purchased new wheel balancers. Five years later he bought a Dunlop Tire store in Windsor and added front-end alignments, brakes and custom wheels.
However, running two outlets proved a challenge, according to David Santing. His father couldn't be at both locations and it was difficult to find competent staff to run the Chatham store, so as sales faltered, he decided to close the Chatham location and focus on the Windsor store.
“The challenge is, one location is a fair amount of work for one individual,” said David Santing, who has resisted opportunities to open other locations. “I don't have the desire for that right now. You have to find the right staff to work without you.”
Despite having to close the one store in the 1970s, the business continued to expand over the next several decades, incorporating radiator service, tuneups, custom exhaust and accessories. Growth was halted during the recession in the early 1980s, prompting Santing's Tire to downsize and reduce debt by subletting much of its space to other vendors. The company rebounded with the economy in 1985 and added more services, including gas tank servicing for customers, garages and body shops.
The store moved again in 1988 to its current 7,000-sq.-ft. location in Windsor that encompasses offices, warehousing and seven service bays. The dealership has six employees.
“There were six tire shops in this area when we first opened in Windsor,” the retired Al Santing is quoted as saying on the company's Web site. “Not one of them is left but us. That's because we recognized opportunities when we saw them. After all, if we didn't, we knew someone else would.”
Today, Santing's Tire faces competition ranging from large retailers, such as Canadian Tire Corp. and Wal-Mart Stores Inc., to other independent tire shops.
The struggling local economy has posed challenges for Santing's Tire. “Windsor is one of the highest unemployed cities in Canada,” David Santing said, noting the economy's reliance on the auto industry in nearby Detroit. The strength of the Canadian dollar vs. the U.S. dollar has not helped as U.S. dealerships across the river entice Canadian consumers.
“To overcome those challenges, we will keep on top of what is going on in the marketplace and change accordingly,” David Santing said.
In addition to keeping abreast of customer demand for services and products, Santing's Tire has been trying to keep up with the latest technology. In 1988, the dealership began computerizing its inventory control and administrative services. It launched its Web site about six years ago and now is developing Internet sales. However, with the strength of the Canadian dollar, sales have been flat. But Mr. Santing hopes to turn the site into another revenue center in about five years.
The firm also plans to split its Web site so there is a section for sales and a section that serves as a marketing tool where customers can ask questions, book appointments and receive e-mail specials. Currently the site features company and product information and informational videos on tires, nitrogen, cooling systems, shocks and struts, filters, custom wheels and fuel-saving tips.
As the company celebrates its golden jubilee, the younger Mr. Santing also celebrates his 50th birthday. He started working in the business with his siblings when he was 13, but he was the only one to pursue a tire career.
His two daughters likewise have pursued other careers, leaving family succession an uncertainty. “We'll concentrate on building up the business in a way that if people want to buy the business, it's established like a well-oiled machine,” he said.