CHARLOTTE, N.C.—Meineke Car Care Centers, an automotive service franchise program under the Driven Brands umbrella, is pushing more aggressively into tire sales through a program called “Meineke ExTRA,” in partnership with Cooper Tire & Rubber Co.
Launched in November 2013, Meineke ExTRA—Expert Tire Replacement Authority—offers Meineke franchisees attractive rates and promotions on Cooper-, Mastercraft- and Starfire-brand tires, including: rebates on most tires starting at 75 cents a tire; marketing support via national promotions and online dealer locator; on-line training; $75 incentives for completing the training; and 0-percent Meineke corporate royalty rates for the first year.
To qualify for some of the incentives, a Meineke center must purchase at least 70 percent of its Cooper- and/or Mastercraft-branded tires from the “designated primary” dis-tributor of Cooper tires. Meineke franchisees can qualify for VIP, Elite or Champion status, based on purchases, according to the ExTRA brochure.
Besides the rebates individual franchisees can earn for their purchases, Cooper is offering the Meineke network a “super volume” rebate for combined sales volume targets, starting at 50,000 units. There are more than 900 Meineke locations throughout the U.S. and 50 in Canada.
Doug Olson, owner of two Meineke stores in Sioux Falls, S.D., said he was “tickled to death” when he heard last year that Meineke was developing an incentive program with Cooper, the brand he'd been selling for years. Mr. Olson estimates tire sales represent 10 to15 percent of his revenue but sees potential to expand that, especially with the sales incentives afforded by the ExTRA program.
“Tire sales are important for us,” he told Tire Business, “because then for the life of that set of tires, they're my customers.” He was satisified Meineke and Cooper have worked out an equitable rebate program that makes reaching the incentive levels affordable.
“Previously, a lot of tire programs were unattainable for the average Meineke dealer,” he said. Meineke dealers can start qualifying for incentives with annual purchases of as few as 200 tires, according to the ExTRA literature, including 100 “qualifying” units. Once enrolled, Meineke franchisees designate their primary brand choice—Cooper/Star-fire or Mastercraft—and primary and secondary wholesalers. Dave Becker, owner of two Meineke stores in the Chicago metro area, said the ExTRA program is structured in a way that allows him to ramp up his tire sales without getting overcommitted.
He likened it to Cooper's Medallion rewards program for its direct dealers. For him, the combination of the Cooper and ExTRA and reliable distribution from U.S. Autoforce as his key distributor helps him make tires an integral part of his business philosophy of making sure the customer is taken care of.
“When I first started on my own,” Mr. Becker said, “it was a struggle to have the right tires available same day to close the sale. Most tire purchases are impulse or last-minute decisions, so it's key to be properly stocked.” Mr. Becker opened his first Meineke shop six years ago in Mundelein, Ill., after working as a master auto technician for 20 years at a car dealership.
He added a second shop, in Lake Villa, three years ago. Since starting with Cooper, Mr. Becker said, he's not had a single complaint from his customers, and the fact that Cooper tires are U.S.-made has helped close sales. The ExTRA program also includes an online training component, he added, which helps get the counter salespeople up to speed on the particulars of selling tires.
U.S. Autoforce also gets involved, he added, by offering specific product sales training, such as for winter tires. Mr. Becker said tires represent about 6 to 7 percent of his sales, or roughly 1,100 to 1,200 tires between his two stores. The ExTRA program replaced a program Meineke had with Continental Tire the Americas L.L.C. the previous couple of years, Mr. Becker said.
That didn't pan out, he said, because the Continental brand is perceived as more of a premium brand and most of his customers are looking for their second or third replacement set of tires.
Cooper declined to comment on its involvement in the ExTRA program, which is sub-headed “powered by Cooper Tires.” The introduction of the ExTRA program complements an aggressive expansion strategy by Driven Brands, which boosted its automotive service store count in the past year by nearly 70 locations through three acquisitions, including 49 operating as Merlin 200,000 Mile Shops.
Two of the acquisitions affect the Meineke network—eight America's Service Station locations in the Atlanta metro area and a dozen CAA Car Care Centres stores in Southern Ontario formerly owned and operated by CAA South Central Ontario. The third purchase was that of the Merlin 200,000 Mile Shops business, which strengthened Driven Brands' aftermarket presence in the Chicago metropolitan area, where most of the Merlin stores are located.
To reach this reporter: [email protected] crain.com; 330-865-6145. Twitter: @reifenmensch