'Convenience' key for Tread Connection mobile service model

CHARLOTTE, N.C. — When looking to start a business, Paul Hosage, co-owner of mobile tire installer Tread Connection L.L.C., said he saw the growth in online tire sales. He believed as that part of the industry grew, demand for mobile tire installation would as well.

"Plus, I could afford it," Mr. Hosage laughed.

Tread Connection started in 2016 when Mr. Hosage bought a van and asked his brother Alex to turn it into a mobile tire-installation vehicle. His first stop with the van, he said, was his brother's wedding to show it off. Then he hit the road, visiting car shows and other events around Charlotte to get the word out.

Mr. Hosage aimed to be out in front of the mobile tire installation industry, and this meant growing the brand — "getting more vans out on the road," he said.

"It was really about raising awareness of the mobile-tire concept," he said. "People don't yet realize mobile tire sales and service is an option."

In 2018, the Charlotte-based company started to franchise. It has 35 franchises located throughout the U.S., and Mr. Hosage indicated there are plans for at least five more "soon." Mr. Hosage said his previous experience of owning a window-tinting franchise gave him a unique perspective for building his own franchise model.

"It was really a grassroots effort," Mr. Hosage said. "We were trying to grow, and (franchising) just seemed natural; it just made sense."

The company is owned by Mr. Hosage, who serves as chief business development officer; Alex Hosage, who builds the vehicles; and Chris Brown, chief executive officer.

"(Our) model appeals to a lot of people," Mr. Hosage said of franchisees. "People that think 'convenience' is really the next big thing that customers want."

Mr. Hosage said there is an appeal to the mobile tire-installation business because the overhead costs are low compared with a traditional brick-and-mortar shop.

Jeff Abbas, a franchise owner operating a van in Denver since September 2019, wanted to own a business, he had an interest in auto repair and he liked the concept behind Tread Connection's focus on convenience.

"It's a great concept," Mr. Abbas said. "... Every customer is like, 'this is brilliant.'

"Getting that message out is really the toughest part."

The cost to start a franchise, according to current Tire Business data, is $165,000 for a 10-year agreement, the built-out service vehicle — a Ford Transit HR350 — and miscellaneous start-up costs.

The company also provides franchisees with hands-on service training and business training.

"It's not just a crash course," Mr. Hosage said, adding that the company holds weekly video meetings with franchisees to answer questions and talk about initiatives. "We really wanted to give them a good place to start."

In the last year, the company has added a marketing partner, e-commerce website, point-of-sale system and merchant processor.

"Really, our long-term goal is, 'How can we help (the franchisee) be successful?' That's our biggest initiative."

At the company's website, treadconnection.com, customers can shop for tires and make service appointments. On the service side, the company exclusively offers on-site tire installation and service, flat repairs, TPMS service and nitrogen tire filling.

"Their business model is evolving as everyone is figuring it out," said Eric Burns, a franchisee in Mooresville, N.C. "They do a good job listening to what (franchisees) need and ideas they have."

Both Messrs. Burns and Abbas said they often field calls to help out fellow operators who may have service questions.

"I was one of the original 10 (franchisees), so there was a lot of growing together," Mr. Abbas said. "... (Now), I help a lot of guys. There's a lot of support."

Mr. Abbas said he is looking to hire a technician and hopes to add more vans in the future.

Mooresville franchisees Mr. Burns and Glen Lowman celebrated their first year in business in June and recently added a second service van.

"And we had out best month in June, too," Mr. Burns added.

He said the biggest obstacle was getting the word out to possible customers. When the franchise launched, Mr. Burns said they went to car shows and anywhere that would make the van visible throughout the area.

"At first, when the phone wasn't ringing for a day or so, you start wonder if you made the right decision," Mr. Burns said. "But we used that time to make connections with customers and educated ourselves. ... Getting more involved in the community really got (the business) going."

Mr. Burns comes from the automotive repair sector, managing an auto shop for a decade before deciding to strike out on his own. He said he became interested in Tread Connection for a few reasons — including seeing a growing trend for more convenience services, a chance to own his own business, and a previous relationship working with Mr. Hosage.

"As advanced as cars are getting, it was hard to find good techs (in the shop)," Mr. Burns said. "I wanted to rely on myself and branch out and do something more secure."

Initially, both he and Mr. Lowman worked together on jobs as a way of learning the business and understanding how to better serve customers. Then they added a second van and recently hired their first technician. He said they plan to add more vans in the future.

"Originally, I was thinking it would be a slower pace, but that turned out not to be the case," Mr. Burns said, explaining that customers really want tire service as quick and painless as possible. "We've made it a priority to make it more about convenience.

"For more and more people, it's really about that. … Time is all they have, and they can't get that back. And many (customers) have really dialed in on that aspect."

Simplified model

Mr. Hosage said keeping service focused on tires and wheels allows the company to serve its core base better: customers seeking convenience above all. It also makes finding and training technicians easier.

"Hiring good people is the hardest thing to do for any company," Mr. Hosage said. "Our model is so simplified; you have a wider pool to train. Some of our best operators and technicians had zero experience when they started."

Tread Connection gets business from three places mainly: Online orders through its website, orders through third-party tire dealers and servicing fleets.

In general, Tread Connection mobile vans do five to eight retail appointments a day. Mr. Hosage said that number increases if a van is doing fleet work — which could mean servicing a few dozen vehicles in one stop — or if the operators are running multiple crews per van.

The service footprint is based on population, Mr. Hosage said, adding the firm is at about 98% same-day availability for appointments.

"A lot of (tire) wholesalers out there are making sure the logistics work out," he said.

The pros of service-area overlap among franchisees outweigh the cons, Mr. Hosage said, because it allows for more people to get to know the Tread Connection brand — the vans "are big billboards going down the road."

It also allows the company, as a whole, to be more responsive to its customers.

"(The business) is profitable, and there's ample room to grow," he said. "We've actually seen a huge (revenue) increase in areas where we have multiple franchisees."

Pandemic response

When the COVID-19 pandemic reached the U.S. earlier this year, Tread Connection was "in a strong financial position" and primed to respond, Mr. Hosage said. Since the business model is built on convenience, making the process touch-free was simple.

"Continuing to offer really good service and take necessary (COVID-19) precautions and help our franchisees is something we know we have to be really good at."

In a market survey conducted by Tire Business, the company said 87% of franchise owners saw an increase in sales after the pandemic hit.

"Use of technology, in general, has been growing, and (the pandemic) has been pushing that even more to the forefront," Mr. Hosage said. "We're seeing a pretty good uptick in business. … It's still not where we want it to be, but I think it's going in the right direction."

Tread Connection has grown organically, Mr. Hosage said. The company operates in 16 states.

"We started with the basics — offering good service — and have built from there. …

"It's exciting to see (the franchise) take hold," he said. "I know if we focus on the quality of what we're doing, we'll end up on top."