Every independent tire dealer in the U.S. knows how difficult it is to be successful in today's replacement tire market.
Dennis Byrne, professor emeritus of economics from the University of Akron, believes tire dealers face three built-in obstacles making it difficult to competeincreasing competition, changing products and technologies, and an ever-growing need to continue mastering information technology.
What's more, he told those attending the recent International Tire Exhibition & Conference (ITEC) for tire dealers and auto service professionals in Orlando, Fla., tire dealers sell a product that customers replace at most every three to four years, however they have to keep customers coming in regularly through the doors, a situation that's not easy to do.
The tire industry also has become global, he said, and the effect on tire dealerships is in price. The market is driven by cost, he said, which means it is ultimately driven by price.
But tire dealers also have an ace in the hole for operating in this environment, an advantage that was discussed in an ITEC panel on high-performance tires. While tire dealers may face pressures on price, tires definitely are not a commodity.
As the market trends more toward high-performance and ultra-high-performance fitments on new vehicles, consumers will require knowledgeable help in choosing the proper tires for their vehicles when it comes time to replace them, said Rick Brennan, executive director of marketing for Falken Tire Corp. and a High Performance Tires panelist.
You can't just pick an ultra-high performance tire today and assume that you know its performance level, he explained.
Each HP tire model has a different level of performance and different personality, he said, and there are many models to choose from. As a result, tire dealers today need to know much more about each tire model they are selling, what's available, what lines the dealership offers and what the consumer really wants.
There is no retailer or service outlet out there that is more suited to handling these types of questions than the independent tire dealer. This should be the dealers' bread-and-butter differentiator.
But tire dealers can't rest on past history and accomplishments. Today's tire customer is more educated than ever, thanks to the Internet, and will become even more so once the National Highway Traffic Safety Administration rolls out the new tire labeling law.
If tire dealers want to stand out in a crowded marketplace, being the well-known, go-to tire professional is a great place to start. They need well-trained, knowledgeable sales and service staff who readily can answer and solve each customer's tire questions and problems.
A notch (or two) above the rest is where the independent tire dealer needs to be.