Unimax to expand Point S network, consolidate retail banner offerings

BOUCHERVILLE, Quebec — Unimax Tire Ltd., one of Canada's largest wholesale tire distributors and retail network promoters, plans to both consolidate and expand this year.

The Boucherville-based company, which administers the Point S marketing group in Canada, plans to expand the retail network's footprint into Ontario, Alberta and western Canada. At the same time, Unimax will consolidate its retail affiliate program by eliminating two of the seven banners it administers.

The company also plans to launch a marketing campaign to boost automotive service sales — and employment.

Unimax sells about 3 million tires annually between its wholesale (65% of sales) and retail (35%) divisions.

Unimax distributes tires to a network of wholesalers in Alberta, British Columbia, Ontario, Quebec and the Atlantic provinces and operates more than 75 tire distribution warehouses on its own and with partners.

In addition, the company operates seven retail marketing programs, covering about 860 points of sale:

• Point S — an international program with 220 stores in Canada;
• V1 — 17 stores in a brand tailored for mid-sized to large retailers that offer tires, auto service and heavy vehicle service;
• Otobox — about 140 stores in a two-year-old program tailored to small and mid-sized retailers that offer tires and auto service;
• Mega Pneu — 221 stores in Quebec that maintain their own identities;
• Pneus Prestige — about 200 stores that maintain their individual identities while benefiting from greater buying power;
• Pneus Max Plus — about 56 stores in a network of independent retailers who maintain their own identity and use the secondary banner for selling tires; and
• Tire People — a six-store network.

Unimax is eliminating two of these banners this year — Max Plus and Tire People — and bringing those stores into the Otobox or Point S networks, Patrick Lavoie, Unimax's director of communications and marketing, told Tire Business.

The eliminated programs, along with Prestige and Mega Pneu, were created initially to reserve a territory for tire retailers, he said.

Over its 40-year history, Unimax created the numerous banners it administers, except for Point S, which was launched in France by Point S Development.

"It was, maybe, good in the past, but for the future, we need to consolidate everything," Mr. Lavoie said. "It will be easier for everyone because we will put more money in marketing, more advertising and be stronger with less banners."

Unimax will keep Point S, V1 and Otobox and the other remaining sub-banners for tire retailers that already have a premium banner for auto service, such as NAPA Autopro, Mr. Lavoie said.

"In some cases, some of our dealers won't have any banners and just prefer to have Otobox because the thing is, if you go with Point S, you need to rebrand your entire store," he said. V1 retailers also have to rebrand their stores.

"It's a lot of money and not everyone would like to do it. So we will change the sign, change the pylon, minimum stuff."

Point S, V1 and Otobox come with a store identity, advertising campaigns, exclusive merchandising, an e-commerce website and other programs.

Point S is a premium banner for large stores that usually compete with Canadian Tire and car dealerships; V1 is a smaller network for large stores that compete with Canadian Tire; Otobox is a secondary banner and more local, he said.

Unimax, which launched V1 recently, plans to expand the brand in the same territories as its Point S stores.

"Our goal for the future will be to consolidate our banners, to have less banners and be stronger with four or five banners," Mr. Lavoie said. "Our goal will be to get more Point S as possible."

He admitted that, due to exclusive territories, some markets have multiple Unimax banners in the same area.

For the time being, the distributor will maintain the Mega Pneus and Prestige networks, he said, adding that the company is evaluating the benefits of each banner.

Boosting sales

Another goal for 2020 is to boost retail sales during the off-seasons.

Mr. Lavoie said that, unlike the U.S. tire aftermarket, Canada has two major tire sales periods — spring and fall — when drivers are buying and/or switching between winter and summer or all-season tires.

He said the so-called Fall Rush accounts for about 70% of Unimax's tire sales for the year.

Eastern Canada, in particular, has very strong sales during the winter time, he said. Quebec has a law requiring vehicles to be equipped with winter tires by Dec. 1.

"One of our mandates is to get more people between the two rushes we have — we have the spring and the fall rush," Mr. Lavoie said. "So we will launch new promotions to get new customers. For example, the summer is pretty tough."

He noted that during the slow seasons, many stores have open service times, so Unimax will be promoting automotive services at its retail stores.

"We didn't do it in the past. It was just tires, tires, tires. So we started last year to sell replacement and repair of auto glass, windshields. So it was a good thing for us. Now we have 94 stores that change and repair windshields. …

"Our goal is to be a one-stop shop. Stop by Point S, you do your brakes, your tires, your mechanical, we do everything about auto glass, accessories. So it's like a one-stop shop."

Sales within the Unimax retail network are split 50/50 between tires and auto service, he said.

That represents a slow transition away from a focus on tires as more tire manufacturers and car dealerships have been selling tires directly to consumers, he said.

While Unimax's e-commerce website is aimed at competing with other online tire sellers, Mr. Lavoie predicts the ratio of tire sales to auto service for the retail network will shift to 45/55 in three or four years.

Recruitment

In addition to its marketing campaigns to promote tires, auto service and auto glass, Unimax is adding a campaign to generate job applications.

"We have a real issue with recruitment and we will launch an employer brand here," Mr. Lavoie said, referring to ads to attract new employees.

"Our stores have a lot of difficulty recruiting people because we have two rushes. So the problem is we need a lot of people during four months of the year and it's kind of difficult to hire people two times for two months. The rest of the time we have some full-time jobs. It's still difficult to hire people in that category," he said.

"Another thing, young people today, they are going into technology. They are going into other industries. And mechanics is not a top-of-mind job presently. So it will be difficult for the next 10 years. We need to find something, a new solution. Presently, we are launching our employer brand to be more attractive, more sexy.

"We will promote the benefit to work with us. So we will launch it this summer," he said, noting that details of the campaign are forthcoming.

"The (consumer) traffic is not the problem for Point S, presently. So for example, we refuse a lot of people during the two (sales) rushes and it's very disappointing to refuse customers. We refuse a lot of customers because we don't have the staff.