Why in the world would I want to sign on to Goodyear's online tire buying and installer program, as outlined in the Feb. 2 issue of Tire Business?
It's a program that spells eventual doom to a large part of the profitability of my business.
All that you people at Goodyear are going to accomplish is to set in motion the need for other tire manufacturers to follow suit with direct-to-consumer programs for “competitive” reasons. In the end, another distribution channel will be established, in a static marketplace, with the loser being the independent dealer channel.
In the end, Goodyear and the rest of the tire manufacturers that follow suit aren't going to produce one additional tire because of this program.
Do you see car manufacturers rushing to allow these same Internet shoppers the opportunity to buy cars and trucks from them online? That may happen someday, but for now car makers seem to be smart enough to respect— and honor—the substantial investments that business people make in their brick-and-mortar auto dealerships, people, inventory and training needed to market their products. You tire makers should do the same.
As an independent tire dealer, I would remain the responsible party in customers' eyes, and I would get to handle adjustments, ride complaints, low mileage claims, etc., and you the tire manufacturer would just sit back and reap the profits! WOW, what a deal!
Are you the tire maker, or your customers, going to pay me extra for having to deal with aftermarket wheels that require special care and $10,000 tire changing machines to do the work correctly? Are you going to be able to explain those special circumstances to your customer before he or she shows up to get the tires installed?
What happens when you, the customer or your wholesale distributor makes an error regarding the size or service rating required to fit the vehicle properly? Guess who's facing the customer when something goes wrong? Not you, and not your distributor. We the tire dealers are.
These are some of the reasons we require more than a $10 profit—or whatever you intend to pay—to make a tire delivery profitable. It's why it is so important that the dealings on tire pricing, and the cost of the services to install tires, be left to negotiations between the delivering dealer and the customer.
This program that Goodyear laid out at the company's recent 2015 Dealer Conference in Grapevine, Texas, is an accident waiting to happen. If you want a program like this for these consumers, deliver the tires through your company stores. You have control over the workings of that channel. You own them, so you certainly can install any program you think would drive business and profits to those locations.
We, the independent dealer channel, helped the car dealers in this country go from a 1-percent share of the replacement tire market to nearly a 10-percent share today. Most of the tires sold in car dealerships are premium products.
Goodyear's program, if it matures, will result in a far greater share of the replacement market moving away from the independent dealer channel than did the car dealer support program. I just don't think the independent channel can afford to lose that large a share.
Personally, I'm not interested in giving up additional premium product sales to my “supplier” this time around. Especially when the program is disguised as something that's beneficial to my cause and my business plan.
I've always thought that crap could be covered with lots of sugar and honey, but it will always be a pile of crap. I'm hoping that this effort by Goodyear fails because of a lack of support from dealers like myself. It's not easy to say no to a major supplier in this tire industry, but if there was a time to do it, that time is now.
Manufacturers' loyalty to the dealer channel has evaporated over the many years I have been in this business, so I certainly hope there are many more dealers who feel the way I do and who will say NO to Goodyear—and to this program.
Charley Gowland
Owner/president
Chabill's Tire Service L.L.C.
Morgan City, La.
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I just have to comment on the front-page article by Tire Business reporter William Schertz on Goodyear's new online tire buying program since I buy all the raw materials for tires at my company's U.S. manufacturing locations.
Recently I needed to buy tires for my personal vehicle and kept waiting for prices to go down (since all the materials prices are falling like rocks).
I waited until I almost had an accident on some rain-slick roads and then decided to go ahead and buy even though I had seen no price reductions yet. I live in the small town of Clinton, Tenn., and try whenever I can to trade locally.
For the sake of comparison, I priced my Goodyear tires online at Tire Rack Inc.'s website, added freight and the cost of installation at an approved installer that was outside of Clinton but nearby.
Then I took this information to my local Goodyear distributor in Clinton. I asked the company to price out the same tires and installation without telling them I had a comparison quote. Their cost estimate was $145 higher. I then showed them my quote and told them I would like to keep my business local and asked if they could meet the price.
The dealership would not and told me they couldn't buy these tires wholesale at that price.
I asked if I bought the tires online and had them shipped to the Goodyear distributor, could they meet the price for installation? The dealership's price was still higher by about $100. Just for grins and giggles, I called a local wholesaler and found the wholesale price for the same tires I needed—it was almost identical to my cost quote from TireRack.com.
I put in a call for the owner of the Goodyear distributor to tell him of my experience, and even entered a request for a call on the dealership's website. I never heard back from anyone.
I don't care if Goodyear does put in a website where consumers can purchase tires. I will still not do business with my local Goodyear dealer. A new online site won't get between me and the local retailer—however, the local retailer took care of that dilemma by having lousy pricing (and by the way, a filthy and uncomfortable waiting area.)
By comparison, the other approved installer—not a Goodyear dealer—was VERY helpful and had a very nice, clean and comfortable waiting room with Wi-Fi.
I'm still mad about this whole experience—can you tell?
Kathy Taylor
Clinton, Tenn.
Editor's note: Ms. Taylor works for a transportation company in Clinton, Tenn., and lives in that town.