CEO Byrd: TBC focused on franchisees, wholesale

PALM BEACH GARDENS, Fla. — Less than 15 months ago, one of the most expansive and historic retail transactions made headlines. TBC Corp. sold its retail tire and auto service holdings — 595 stores in 15 states — to Mavis Tire Express Services Corp. in what is considered the largest transaction in the U.S. tire aftermarket in the past quarter century.

The deal, which included 203 Tire Kingdom Service Center locations in Florida and 392 NTB Tire & Service stores in the mid-Atlantic, Midwest and South, including Texas, boosted Mavis to nearly 2,000 stores throughout 25 states.

TBC Corp., owned jointly by Group Michelin and Sumitomo Corp. of America (SCoA), continues to have a strong presence in retail through its Big O Tires and Midas International franchise businesses, which together represent more than 1,600 locations.

On the wholesale side, TBC distributes tires in the U.S., Canada, Mexico, Latin America, the Middle East and Europe through its National Tire Wholesale (NTW), TBC International and TBC de Mexico units.

Divesting nearly 600 retail stores has helped TBC "be really clear what our focus is," according to TBC President and CEO Don Byrd. Byrd succeeded Sam Kato in April, nearly a year after the sale was finalized. Kato spent 11 months as TBC's top executive before rejoining Sumitomo.

"We can articulate to being the franchisor of choice and the distributor of choice," Byrd told Tire Business at company headquarters in Palm Beach Gardens.

"It allows us to do that because we are not, I'd say, distracted, if you will, of being the retailer of choice or trying to operate our own retail."

The story was first featured in the Sept. 9, 2024, edition of Tire Business.

TBC and Mavis did not disclose financial terms of the deal, but according to fiscal 2023 financial statements, Michelin and SCoA netted $174 million and $107 million, respectively, from the sale.

Byrd said the company feels "good about our ability to deliver on our strategy and our purpose by being laser-focused on our franchise business and our distribution business."

TBC markets 26 proprietary tire brands, serving the passenger, light truck, medium truck, trailer, agricultural, industrial and specialty sectors. As part of the deal with Mavis, TBC is providing wholesale tire distribution for Mavis retail locations, strengthening TBC's already extensive wholesale business.

"They're one of our larger customers that we support today as we continue on our ambition of being a distributor of choice," Byrd said.

Today, a leaner TBC follows a strategy that involves its own version of a three-P-eat.

Byrd said the company adheres to three P's: Purpose, people and planet. If the company performs well in each area, it will accomplish a fourth P: Profit.

"And if we do those things well, then the result will be that we will be rewarded with creating value or profit for our key stakeholders."

Purpose, Byrd said, is strategy No. 1. It involves being recognized as the franchisor and distributor of choice, as a result of prioritizing customers.

"Our franchisees are our customers," he said. "How do we serve them? How do we serve them better, frankly, to help them be successful?"

People, he said, refers to the 4,000 TBC employees across the U.S., Canada and Mexico.

"We're in the people business, and so we can't be the franchisor of choice or the distributor of choice if we're also not the employer of choice," he said. "And so how do we all work with our associates to create a incredible experience, so that they bring the very best of themselves to work every day, to contribute every day, to drive value every day, so that we can deliver on that purpose?"

The third P, planet, involves a commitment both to the environment as well as to the communities TBC serves.

"We want to be a winning company. We want to be a great company."

In order to be a great company, he said, TBC first must be a good company, or "a company that does good ... in the communities in which we operate, which we serve, and where we where we employ, as well as making an impact in the environment."

TBC, he said, serves customers in "as environmentally responsible way as possible," reducing CO2 emissions in fleets as well as organizing operations to make a sustainable impact.

"We have some very clear ambitions in terms of voluntarism, community service, community giving," he said.

That focus on community service certainly is clear to the tire industry at large. Two of the last seven recipients of the Tire Business Humanitarian Medal — which recognizes an independent tire dealer or retreader who has made significant contributions to the betterment of their community through charitable and/or public service work — are Midas franchisees: Mark Smith of Midas of Richmond (Va.) and Ron Katz of Midas of West Palm Beach (Fla.).

In fact, each year Midas presents a Mark Smith Community Involvement Award to a franchise owner who strives to build strong community involvement in the markets where they serve.

Byrd said giving back to the community is part of the DNA of both Midas and Big O, "both in terms of their local communities, but on programs nationally, and then as TBC, we take that on as well with our own initiatives, whether it's through the United Way or through the American Heart Association, as well as some local groups here that support the environment."

Byrd said that if TBC successfully executes the three Ps, "we'll be rewarded by our customers in terms of the value that they'll see and that they will show to us that we then can provide to our shareholders."

TBC was formed in 1956 as Cordovan Associates, a small purchasing group of tire retailers in Dayton, Ohio. Cordovan morphed into Tire & Battery Corp. in 1972, six years after acquiring Big O Tires. Nine years later it went public under the name TBC Corp.

The company delved into retailing in 2000 with the purchase of Tire Kingdom and expanded that business sector three years later by acquiring National Tire & Battery (NTB) from Sears Roebuck & Co.

Sumitomo acquired the company in 2005 and in 2012 bought Midas International. SCoA brought in Michelin as a joint-venture partner in 2018 as part of the creation of National Tire Wholesale (NTW).

That's the same year Byrd joined the company, moving over from Michelin, where he was president and COO of Michelin's TCi wholesale business.

"We have strong and lofty ambitions, but we take on that challenge, and we measure that by, 'Are we a growing company? Are our franchise businesses growing? Our wholesale businesses? Is there still growth even in, what I'll call a challenged market environment that we experience today?' "

Byrd called his current role "a humbling opportunity," as the lead member of an organization "the size and scope of TBC."

He said his executive team, many of whom, like him, are relatively new to the organization, is talented, "along with all of our TBC associates that go out every day trying to be the best we can be and satisfying our franchisees so they can satisfy their end consumers."

Byrd said Kato progressed the business during his tenure, just as others before him.

"So it's now my responsibility to do that with this team going forward. The best of TBC is in front of us."