CLEVELANDWhile many tire dealerships boost their automotive service menu to attract more business, Conrad's Xpress Tire Inc. is encouraging auto service shops to bolster their tire offerings to achieve the same goal.
The wholesaler's affiliated dealer program, Xpress Tire & Auto Service, has been targeting auto repair shops in northeast and north-central Ohio to join its program since 2009 with the goal of increasing sales by adding or increasing tire revenues.
The Cleveland-based program, which has 134 affiliates, is now looking to expand beyond the Cleveland-Akron-Canton metropolitan region into the more sparsely populated and rural areas stretching eastward toward Pennsylvania and westward toward Indiana.
During the past 18 months, the company has expanded its distribution into some of the rural markets surrounding the northeastern metro area with the help of an expanded distribution center in Akron it moved into last summer. The wholesaler also operates a warehouse in Cleveland and provides deliveries three times a day.
Conrad's distributes to about 600 independent dealers in the region, and its affiliated dealer program has been encouraging repair shops that may not have sold many tires in the past to increase their tire business.
We're kind of a niche player, I think. Our traditional customer isn't your traditional tire dealer. Our customer generally is a mechanically oriented automotive repair business, said W. Dan Cochran, general manager of Conrad's Xpress Tire.
What we tend to do is try to get them more engaged in the tire end of the business and using that as a conduit for customer retention and new customer acquisition.
He emphasized that the uniqueness of the program is that we help these independent 'service oriented' dealers take advantage of the benefits of collective tire marketing, while protecting their individuality. They value their individuality a great deal.
With the exception of a few businesses, most of the affiliates are single locations. Mr. Cochran typified them as generally the better shops in the marketplace catering to a clientele that is more relationship oriented than transaction oriented. He noted that most of the shops the program attracts have historically looked at tires as an as-needed product as opposed to something to focus on to build bay traffic.
That's part of our program, coaching them and getting them engaged in tires and understanding they are one of the few things that are a constant anymore in terms of driving car count.
Shops must meet a minimum average monthly quota of tire purchases to qualify for the program, so every six months, we do eliminate a few and bring a few on, Mr. Cochran said. The program increased its count by about 5 percent to 134 members last year and hopes to reach its 150-store target by year-end.
What we want is consistent growth, he said, noting that affiliates add Xpress Tire signage to their facilities but keep their own business namesthe program's identification is secondary to the individual shop identifications. We work really hard, as much as possible, to keep them as independent as possible so they don't lose their individuality.
Even with our public website, when a consumer chooses a dealer, it's difficult for them to try to play one dealer against another because our dealers are all expressing their own pricing, their own matrixes out in the field through our public website. We make it that way so that they can maintain that individuality, he said.
Xpress Tire, which doesn't charge fees to participate, plans to roll out a Level 2 tier with additional features for a nominal fee sometime in the third quarter, he said. Mr. Cochran declined to provide details until the roll out but said it would be an optional upgrade within the program.
While Xpress Tire advertises periodically on radio, cable and billboards when marketing funds are available, the primary marketing focus is on the Internet consumer-facing program to drive customers to its affiliates. We found it to be the most effective way to attract and drive traffic, he said.
On Xpress-tire.com, a consumer chooses a local affiliate and is taken to that affiliated dealer's landing page before the consumer shops for tires. The consumer can contact the dealer directly through the landing page.
For the time being, Xpress Tire has not considered online ordering capabilities.
As you can imagine with all these independent entities, there's some complications there, Mr. Cochran said. Thus far we've elected not to actually consummate the transactions. We want to try to build the relationship between the consumer and that dealer as much as possible. All we're trying to do is provide a channel for the consumer to find them.
He said auto shops join the program because Xpress Tire drives customer traffic to them.
They're looking to increase their tire business and many of them are not real familiar other than reading a sidewall. They're not real familiar with tire brands and speed ratings and we provide a level of expertise for them.
We provide training for them. We provide support for them. We pay a lot of attention to them with more of the mindset of a retailer than what a general wholesaler would be, Mr. Cochran said.
Part of that expertise comes from the Xpress Tire program's sister company, tire retailer Conrad's Tire Express & Total Car Care, which operates 34 stores in the metro region.
We take that experience and expertise and we try to apply it for those individual independent dealers to help them grow their business accordingly.
It's a little different from what a traditional wholesaler would be. Most of our deliveries are four tires or less per dealer. We're not dropping off tonnage to most of these guys. Most of them don't inventory anything.
Mr. Cochran noted that despite its affiliation with a large tire retail chain, the Conrad's stores and the affiliated shops rarely compete for the same customer, even when located near each other.
That's because the wholesaler distributes mainly Cooper- and Falken-brand tires to its affiliatesbrands that Conrad's doesn't carry among its portfolio of major and associate brands.
The other thing is that (for) these independent shops, their customer is generally a very relationship-oriented customer. They value knowing the business owner, going into a shop a year from now and finding the same people there....
Conrad's operations are a little different, he continued. Conrad's is more targeting a transactional-based customer, for lack of a better term. They try to engage that consumer and marry them to the brand but with people transitions and things that go on in a multi-location business, it's a different style.
So it's really a different consumer that the two businesses cater to, he said, admitting there is always going to be some overlap in certain markets.
He likened the affiliates' customer base to a consumer who has a Lowe's and a Home Depot nearby, but prefers to visit a local hardware store.
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