PAOLI, Pa.—Main Line Tire Group is poised to enter a rebirth of sorts, which will include a rebranding of the company's 15 outlets across Pennsylvania and one in Delaware, expanded product offerings and the introduction of an associate program for dealers.
The company's stores, currently named for the cities in which they're located, will be unified under the brand identity United Tire & Service, said Main Line owner Ken Sylvester.
He added that the change is designed to simplify the company's marketing strategy and reduce costs by allowing it to develop all-encompassing advertisements instead of 16 individual ads.
“One of our problems is because of the way we have our stores indentified—they're all named by the town they're in—it makes it very difficult to buy media buys,” Mr. Sylvester said. “How do you advertise a group of stores if they're all different names? That was one of the deciding factors in coming up with the name change.”
Mr. Sylvester said he expects the changeover, which will include a new website, to take place early next year. Right now, the company is working with a local ad agency to develop a United Tire & Service logo.
But the company will begin informing customers of the rebadging soon, he said.
“We want to make sure the customers are aware that there's a name change coming and make sure that we communicate for a good long period of time before the signs actually go up,” he said. “...We'll probably put temporary signs inside the stores so when customers come in they see them, and we're going to do direct mail to advise customers that (the name change) is coming.
“We really want them to know that we're the same great place, they're going to get the same great service—it's just a new name to better service them.”
In addition to the name change, Main Line, which has been primarily a Goodyear dealer for many years, is adding several brands to its mix of tires.
“One of our main goals is to increase tire sales, so we're going multi-brand,” he said. “We were essentially almost 95 percent Goodyear, but with the market change and the competition for just the one brand we're opening up the doors and making negotiations with other manufacturers to have them come in and be our suppliers for other tires as well. How else can you get listed on their websites if you're not working with them?”
According to Mr. Sylvester, Main Line has always made a habit of acquiring any tire a customer asks for, “but because we weren't buying as an entity—we were buying as individual locations—we could never get enough volume to get advertising dollars and to get support from the manufacturers.”
He noted that the company has already entered deals with Continental Tire the Americas L.L.C. and Pirelli Tire North America Inc. to sell their tire brands and is working to establish relationships with Bridgestone Americas and Michelin North America Inc.
“We're trying to stay with major brands,” he said. “We're known in our marketplace to have quality tires, so we're not looking to get into competition for the low-end market.”
While the company's product screen is changing, Mr. Sylvester said the company is not aiming to lose Goodyear unit sales.
“We actually believe that if we have the ability to be listed on the other websites so that we can steer customers that aren't looking for a Goodyear tire into our locations that we can still sell them Goodyear tires,” he said. “Our goal is not to decrease our Goodyear units, but to increase other tire sales and get more foot traffic in the door.”
Though Mr. Sylvester is not ready to disclose details, the name change to Main Line's stores will coincide with the launch of an associate dealer program—which also will use the United Tire & Service brand identity—set to debut sometime after Jan. 1, he said.
One of the main features of the program, according to Mr. Sylvester, is that it will provide aging dealers with succession planning.
“I think one of the big trends we see going on is that the big guys—like Monro, Mr. Tire and Pep Boys and all these guys—are coming and gobbling up (independents) because they don't have an exit plan,” Mr. Sylvester said. “It's a real trend that we don't want to see continue, at least not in our market. So we're trying to put together a program that will benefit us and them so we can all grow together.”
In many cases, he said, dealers turn to these larger businesses because “they know once they sell it they can walk away and they're done.”
“When you go to an independent person, you might end up taking some of the money back to make the deal happen, because it's pretty difficult these days to get the banks to give you 100-percent financing on a cash-only deal,” he said. “Most of these guys sell their business on net earnings, and it's all based on cash flow. Let me know how many banks out there will take a cash flow loan.”
Many dealers don't have family members who are interested in taking over their businesses, and they're not sure what to do in order to leave, he said. The program will provide those dealers with options ranging from decreasing their own level of responsibility to getting out entirely.
“We already have the accounting setup to do 16 stores, so we could easily do 30 stores. We could go in and do their books and help them run their company, which would allow them to have some more quality time away from their business,” Mr. Sylvester said.
The program will include services like store management, employee training and running benefits programs, among other things.
“Instead of worrying about, 'What am I going to do when I'm 65?' they can continue to run their store or we can help them with a buyout—whatever they would like. At least it gives them some options they haven't had in the past.”
Mr. Sylvester said Main Line isn't looking to buy participating stores—rather, he said, he's simply hoping to keep independent dealerships among independent tire dealers.
“What we're looking for is we have people in our organization who would like to be partners in other organizations as well, so we're looking for them to step up and buy,” he said. “And it doesn't have to be someone within our group.
“If this gentleman who wants to sell his business has a partner who comes in, but he thinks he's not strong enough to run it—because that's the biggest fear these guys have is that they sell their business and then it goes out of business—if he can sell it to someone and then someone else comes in and helps him, like we would do, then their success rate would be much higher.”
It also benefits new dealers who might otherwise have to build a store from the ground up.
“Nowadays to start up a store of any size and then try to get some market share it would take you five years,” he said. “So you better have pretty deep pockets to keep that place running. We started a few locations ground-up, but our best locations are locations where we went in and took over from previous owners.
“If you walk in there with a known customer base, you just got to treat them right. That's our philosophy—there's no more important customer than the customer that comes walking in your door.”