Modern Tire Dealer - May 2012

TIRE COMPA PANY PROGRAMS THE INDUSTRY’S LEADING PUBLICATION

GREEN SWEEP Low rolling resistance

BRAND AWARENESS

Which is the best program forr your business and which isn’t?

150+ brands give you lots of options

VACATION DRIVING CHECKS Based on size, RVs need extra care

May 2012 | Vol. 93, No. 5 | $10 | A Bobit Publication | www.moderntiredealer.com

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TIRE COMPANY PROGRAMS THE INDUSTRY’S LEADING PUBLICATION

GREEN SWEEP Low rolling resistance

BRAND AWARENESS

Which is the best program for your business and which isn’t?

150+ brands give you lots of options

VACATION DRIVING CHECKS Based on size, RVs need extra care

May 2012 | Vol. 93, No. 5 | $10 | A Bobit Publication | www.moderntiredealer.com

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Features 18 Green sweep

Environmental awareness and cost savings fuel the development of low rolling resistance tires

The Industry’s Leading Publication May 2012, Volume 93, Number 5

Departments 4 Editorial

32 ‘Have we got a program for you’

The number of tire manufacturers with detailed associate dealer programs keeps increasing

40 From A to Ziegler

Based on its size, an RV needs extra care

44 Undercar rcar checklist st

Brand awareness

6 Online Traffic report: Readers keep track of competitors with top website news items

8 News/views Through the ages with Reno Vulcanizing Works: 90-year-old Nevada dealership thrives on long-term relationships

16 Ludwig Report Tire prices are high and more increases are on the way

38 Focus on industry Good as GOLD: Continental shines up associate dealer program

54 Business insight The power of letting go: SalesMinded dealers use their greatest assets to grow

Ziegler Tire, e, “On the Roadd with Service andd Quality sincee 1919” 9”

57 Counter intelligence Blah, blah, blog! Simple steps to improve your content and visibility

58 Focus on industry BKT (USA) outlines strategies for growth: North American sales goal is $220 million in 2014

60 Focus on dealers Family-oriented: Bill, Scott, Jason and Tracey showed why a Jack Williams Tire event is wholesale fun

46 Risk vs.. reward

Sports marketing from the tire manufacturers’ perspective

552 Sponsorship opportunities abound But tire dealers must get off the sidelines

62 Focus on dealers Professional focus, investing in growth: Tire Pros dealers speak out, ATD responds with more growth opportunities, enhanced online presence

64 Focus on industry Destination: Eco-friendliness — Bridgestone debuts Turanza, Destination tires

65 TPMS Volvo C30: Driven to program TPMS — Central electronics module needs relearned when replacing sensors

74 Your turn Article put ‘wind in the sales’ of reader

68 Products 70 Quik-Link 71 Classified Modern Tire Dealer is a proud member of: TRIB

TIRE RETREAD & REPAIR INFORMATION BUREAU

Member An Industry Association

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Editorial

Brand awareness T

he story you are about to read is true. The names have been eliminated to protect the innocent — and the guilty.

A tire dealer friend of mine was visited by a representative from one of his tire suppliers a few years back. It was prior to the recession.

“Here’s what I need you to do for me,” said the rep.

By Bob Ulrich “Don’t you mean what you need to do for me?” said the dealer. “I buy thousands of tires from you. I am your customer.”

Believe it or not, the rep wouldn’t budge, and outlined what he and his company needed. My friend ended what was once a mutually beneficial relationship with the supplier.

Did his dealership suffer? After all, his stores were known for selling the brand. Nope. He replaced it and moved on to bigger and better things. And he never looked back.

Sound familiar? I hope not. Strong relationships with your tire suppliers will help your business run more efficiently and successfully, and less stressfully.

But the brand is only part of what defines you in the public’s eyes.

There are more than 150 consumer tire brands from which to choose. That gives you a lot of options.

Look at Les Schwab Tire Centers. The third largest independent tire dealership in the country sells the Toyo, Dean, Federal, Hankook and Multi-Mile consumer tires, but you would never know it by looking at its advertising.

Or outdoor signage. Or website.

Oh, the tires all have names. They are almost always the line names, however, not the brand names. Take, for example, the Toyo Open Country A/T. The SUV tire is listed on the company’s website as the Open Country A/T. (I had never heard of one of the passenger car tires, Thunderer, and had to look it up. It is made by Deestone Ltd. out of Thailand.)

Does it matter? When potential customers see an ad,

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or drive by an outlet, or search the website, they see Les Schwab tires, not brand name tires. Branding your business doesn’t get any better than that.

The 434 Les Schwab Tire Centers do have their own tire, by the way. They sell the Tourevo, a private brand tire manufactured by Toyo Tire U.S.A. Corp. Les Schwab lists the brand, but not the manufacturer.

Mountain View Tire & Service Inc. has grown from one store to 30 in 25 years. Along the way, the company has varied its logo, sometimes from store to store. Founder, CEO and President Nick Mitsos, Modern Tire Dealer’s 2011 Tire Dealer of the Year, even agreed to a drastic change once; it didn’t work.

“When we were a one, two or three store operator, Mountain View Tire didn’t mean much to anybody,” says Vice President Chris Mitsos, one of Nick’s three sons in the business. “Goodyear did. That’s the reason we always chose to go to market as Goodyear.”

One store featured the bright Goodyear logo with small, dark, understated “Mt. View Tire” under it (see photo).

A new logo has been created to better promote and unify the brand. It will appear not only on each store, but also everywhere else, including the company’s Web page (www.mountainviewtire.com), says Chris. With 30 stores, “we now have the flexibility to change. Our density and penetration is such that we need to make Mountain View Tire the number one name.

“Goodyear will continue to be a wonderful partner and supplier to us,” he adds.

And that’s the way it should be. Don’t get me wrong.

Brands have value. Goodyear, Michelin, Firestone and Pirelli usually score very well in top-of-mind awareness surveys.

To take advantage of that makes sound business sense.

However, they should never overshadow your own identity.

And they don’t have to. There are more than 150 consumer tire brands from which to choose. That gives you a lot of sales, marketing and branding options. ■ If you have questions or comments, please e-mail me at bob.ulrich@bobit.com.

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Online

Traffic report

3515 Massillon Road, Suite 350 Uniontown, Ohio 44685 (330) 899-2200, fax (330) 899-2209 Web site http://www.moderntiredealer.com

Readers keep track of competitors with top website news items

Editor: ROBERT J. ULRICH Bob.Ulrich@bobit.com Managing Editor: LORI L. MAVRIGIAN Lori.Mavrigian@bobit.com Senior Editor: BOB BISSLER Bob.Bissler@bobit.com

J

ust what is your competition up to these days? That’s what readers of our website, www.moderntiredealer.com, wanted to know last month, as some of the most popular news items concerned car dealers, Walmart and other service outlets.

Our top news item was “Survey compares car dealers to independents,” posted on April 23. It covered survey findings from the “Consumer Reports Annual Auto Survey,” which compared independent repair shops with car dealerships.

The second most popular news item was “Michelin will build another OTR plant in S.C.” posted on April 10. Michelin North America Inc. released information on what it called its “biggest manufacturing news in more than 15 years” — its new OTR tire plant in Anderson, S.C., and the expanded production at its OTR tire facility in Lexington, S.C. The two projects represent a $750 million investment for the company.

On April 9, we reported on “Good and bad publicity for Del-Nat,” concerning the company receiving national media attention due to a Memphis business writer’s column on the company’s profitability. And we also reported on a Del-Nat recall of a small number of P-metric light truck tires.

The fourth most read news item was “3 to 1: Bridgestone combines dealer programs,” reported on April 3. It covered Bridgestone Americas Tire Operations LLC’s official launch of its independent retail dealer program called the Bridgestone Affiliated Retailer Nationwide Network. The new program combines the company’s current Affiliated Dealer, TireStarz and Family Retail Dealer programs under one umbrella

By October, Michelin will expand capacity at its for the United States market.

Lexington, S.C., OTR plant.

The fifth most popular news item last month was “Midas will soon become a TBC subsidiary,” TBC Corp.’s announcement that it had accepted payment of all the shares of Midas Inc. common stock. Therefore, the merger had been completed and Midas had become a wholly-owned subsidiary of TBC. Also receiving a lot of hits was a lead-in to Editor Bob Ulrich’s blog on “Walmart’s size influences its customers, competitors and suppliers.” See “Size matters where Walmart is concerned” posted on April 18.

All of this news, and much more, can be found on www.moderntiredealer.com.

And please add your comments to the news, too!

Total access — totally free www.moderntiredealer.com

Contributors: Auto Service/Technical: MIKE MAVRIGIAN Training/Tire Service: KEVIN ROHLWING Industry Analyst: SAUL LUDWIG Art Director: NEAL WEINGART Neal.Weingart@bobit.com Production Manager: KAREN RUNION Karen.Runion@bobit.com Publisher: GREG SMITH Greg.Smith@bobit.com South and Texas: GREG SMITH Greg.Smith@bobit.com (330) 899-2200, fax (330) 899-2209 Midwest: MICHELE VARGO Michele.Vargo@bobit.com (330) 899-2200, fax (330) 899-2209 West Coast: JOHN DYAL The Dyal Company John.Dyal@bobit.com (760) 451-5026, fax (760) 451-5039 West Coast: MARIANNE DYAL The Dyal Company Marianne.Dyal@bobit.com (760) 451-9216 Automotive Aftermarket: DAN THORNTON djtinc@gmail.com (734) 676-9135, mobile (313) 410-0945 fax (734) 675-6744 Classified Sales: DONNA STEWART Donna_Stewart@cox.net (405) 513-6794, fax (360) 406-7576 Reprint Sales: KAREN RUNION Karen.Runion@bobit.com (330) 899-2200, fax (330) 899-2209 Customer/Subscription Service: (888) 239-2455, fax (888) 274-4580

Modern Tire Dealer is a Bobit Publication Executive offices: 3520 Challenger St. Torrance, CA 90503 Chairman: Edward J. Bobit CEO & President: Ty F. Bobit Chief Financial Officer: Richard E. Johnson

MODERN TIRE DEALER (ISSN 00268496) (CDN IPM #40013413) (USPS #369-170) is published monthly by Bobit Business Media, 3520 Challenger St., Torrance, California 90503-1640. Periodicals postage paid at Torrance, CA 90503-9998 and additional mailing offices. POSTMASTER: Send address changes to MODERN TIRE DEALER, P.O. Box 1068, Skokie, IL 60076-8068. Please allow 6 to 8 weeks for address changes to take effect. Subscriptions in the U.S. and its possessions, $65; Canadian, $99; Int’l surface mail, $99; Int’l airmail, $198. Single copies, $10, except the January Facts Issue, $30. Address all subscription correspondence to MODERN TIRE DEALER, P.O. Box 1068, Skokie, IL 60076-8068. Please allow 6 to 8 weeks to receive your first issue. Please address Editorial and Advertising correspondence to MODERN TIRE DEALER, 3515 Massillon Road, Suite 350, Uniontown, OH 44685-6217. The contents of this publication may not be reproduced either in whole or in part without consent of Bobit Business Media. All statements made, although based on information believed to be reliable and accurate, cannot be guaranteed and no fault or liability can be accepted for error or omission. For your information: We sometimes make our subscriber information (i.e. fax, e-mail or mailing address) available to carefully screened organizations whose products and services may be of interest to you. If you prefer not to have your information made available, please write MODERN TIRE DEALER, P.O. Box 1068, Skokie, IL 60076-8068.

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News/views

Through the ages with Reno Vulcanizing Works 90-year-old Nevada dealership thrives on long-term relationships Reno Vulcanizing Works has grown up with the automotive industry, and through its 90 years has survived the hard times of the Great Depression, rationing during World War I and WWII, the shock of 9/11 and much more.

The Reno, Nev., tire dealership is now run by brothers Steve and Mitch Besso, the grandsons of one of the founders. It has two locations in Reno and one in Sparks, Nev. Reno Vulcanizing Works was formed in 1920 when Italian immigrant Frank Menante bought half of a business that repaired bicycle tires and rubber-soled shoes, and had just begun to sell automobile tires.

Menante wanted to be a part of the fledgling auto industry. In 1922, he asked his friend, Augustino “Gus” Besso, to buy the other half of the business and the partnership was born. The company soon began emphasizing automobile tires.

When Frank and Gus retired in 1946, sons Ralph Menante and Leland “Lee” Besso took over. In 1954, they moved the dealership three blocks north to a new site — which they were told by several customers at the time was “too far out of town!” The deal-

Reno Vulcanizing Works in 1948.

Decoration Day specials in 1929.

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ership was one of the first buildings in that “remote” location, but the partners saw the city of Reno grow up around it.

Through the years the company sold passenger, light truck, medium truck, retreads and batteries and accessories. It distributed automotive parts and had a retread plant producing retreads by both hot cap and Oliver precure methods. The company got out of retreading 20 years ago.

In 1986, Lee Besso and Ralph Menante retired, handing the store over to their sons, Fran and Larry Menante and Steve and Mitch Besso.

After Larry Menante’s death and Fran Menante’s retirement after 35 years with the company, the dealership is now owned by the Bessos.

Steve Besso believes his company, now known as Reno Vulcanizing Auto Care and Tires, is “the oldest continuously owned Goodyear dealership in the country.” In addition to Goodyear tires, the company sells Kelly, Michelin, Cooper and many other brands of passenger and light truck tires and offers a full range of automotive services.

Reno Vulcanizing has seen competitors come and go over the last 90 years, the latest being the Internet. But Besso does not bemoan the new age competitor. When a customer buys tires online and brings them to Reno Vulcanizing for mounting and balancing, “Our ultimate goal is to turn them into our customers,” Besso says. “In most cases, their savings are not significant. They may save $30 to $40, but where do they go for service and a warranty? That’s a real issue most online buyers don’t think about when they buy tires from a faceless machine.”

The company’s secret to success is “honesty and integrity,” Besso notes. “Our main goal is to maintain and develop long-term relationships with our customers.

“The business model for a lot of companies these days is get as much as you can as fast as you can, irrespective of the customers’ needs. We have a different vision.

“We have 90 years of positive community involvement. When people come in here, they’re now dealing with the fourth generation of Besso.” Mitch’s son, Josh, works at the dealership. And Steve’s daughter, Times Tim es and pr price icess have have changed chang ch anged ed prices Steveelee, works there part-time during the since Reno Vulcanizing Works summers.

— Lori L. Mavrigian opened in 1922.

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News/views Organic expansion, world-class ser vice That has always been the Les Schwab way Since Les Schwab died in 2007, the company he founded in 1952 has steadily expanded its network of Les Schwab Tire Centers to 433 stores, including affiliate companies. It recently announced plans to add five stores each in Denver, Colo., and central California this year.

Are more on the way? To find out, we talked with Dale Thompson, chief marketing officer for Dale Thompson the Bend, Ore.-based company.

In this exclusive interview, Thompson shares more details about expanding into Denver and California, and the company’s business model. And he talks about Les Schwab’s true legacy: unmatched, worldclass customer service.

‘There is a need for our level of service.’

MTD: Are there plans for further growth this year?

Thompson: For 2012, that is the extent of what we’ll get up and running, but we are planning more stores for those markets. We have no concrete plans to announce at this point, but we are always looking at opportunities to expand and grow. We grow organically at a pace that we are comfortable with.

MTD: Why Denver and metropolitan Fresno?

Thompson: We’ve found that in the markets we’ve expanded into, there is a need for our level of service and business model. The model is expandable. It’s a continuation of our 60-year strategy.

MTD: You are the largest independent tire dealer in the Northwest. Would you consider expanding eastward?

Thompson: It’s hard to say at this point. Denver is certainly eastward for us. I think our level of service, competitive prices and all other things Les Schwab offers will work north, east, south and west.

MTD: Do you have a goal for number of stores?

Thompson: One of the core features of the success of Les Schwab is that we are a promote-from-within company. Growth is a natural outcome of that opportunity. So there is no set goal.

Stores in the new markets will feature a new design based on feedback from customers. They will be more energy efficient with plenty of natural light. And employees will continue to run out to each car as it enters the parking lot. “That’s part of our world-class service. It’s going to be the same wherever we go,” says Thompson. — Bob Ulrich

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News/views

bites Reifen exhibitors increase The 27th international Reifen trade fair will be held at Messe Essen, Germany, on June 5-7, 2012.

More than 645 exhibitors from 44 nations will present products dealing with tires, wheels and vehicle technology. This is a 10% increase over the number of exhibitors at the last Reifen trade fair. Visit www.reifen-messe.de.

Maxxis signs the Orioles Maxxis International-USA has signed a sponsorship deal with the Baltimore Orioles Major League Baseball team for the 2012 season.

The company will have signage behind home plate at every home game. The Orioles join the New York Yankees, Los Angeles Dodgers and Washington Nationals baseball teams, plus the National Basketball Association’s New York Knicks, on Maxxis’ roster of sponsored professional sports teams in the United States.

Love’s opens in Jasper, Ala. Love’s Travel Stops has opened a travel stop in Jasper, Ala. It is the company’s seventh location in the state. Love’s now has more than 290 locations and 130 Love’s Truck Tire Care centers in 39 states. A Love’s Truck Tire Care center is located on-site at the new travel stop. The company’s growth rate is approximately 20 stores per year.

Latin American tire expo The Latin American & Caribbean Tyre Expo 2012 opens its four-day show and conference on July 25, 2012, at the Atlapa Convention Center in Panama. The expo has already signed up more than 160 exhibitors including Bridgestone Tire Costa Rica, Sailun Tire, Double Coin Tire, and Titan International, show organizers say.

See www.LatinTyreExpo.com.

High marks for Nexen tires Nexen was awarded second place in the summer tire test carried out in Europe by “promobil, the motorhome magazine.” The Nexen CP321 scored well in braking performance, side control, handling and anti-aquaplaning abilities. Plus, “Auto Bild” magazine was looking for “Germany’s best summer tire” in one of its recent issues. The Nexen N8000 in 225/45 R 17 W size earned 11th place among 50 rated tires, ranking it as one of the best tires offered in Germany.

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Continental dealers strike GOLD The more you sell, the more you get back If a tire dealer meets all of the Continental GOLD associate dealer program’s sales targets, he or she can earn more than $20 a tire in bonuses. And if dealers also are part of another dealer group that, as an entity, is a GOLD member, they may be able to earn more.

At the recent GOLD dealer meeting, attendees were told about the program’s new features, including access to online sales training through the company’s dedicated website. Jim Sicking, director of independent dealer sales, announced there are already 16,000 online users for the Engage 360 website.

GOLD dealers also are able to use online webinars on a wide variety of product and sales training. There will be five more educational tools added Lyndsey Bowlus, sales training manager for Continental, shows Joel Vanderburg and his wife, Maggie, to the site in 2012. the workings of the company’s upgraded website Under the GOLD and its online training program, Engage 360. Vander- program, dealers can burg works for his family business, Manley Tire Oil get tailored market Service in Valley Springs, S.D. analysis showing market potential down to tire segments, vehicle categories and tire unit potential, including tire sizes —- all the way through exact brand/pattern applications. This can be developed along with a profitability analysis that includes a sell-out pricing analysis.

This study is based on selecting specific vehicles and tire applications and then looking at an unbiased competition retail price matrix. The analysis also includes estimated competitor “sell-in” pricing.

To date, there are 2,400 associate members participating in the Continental GOLD program. In addition, there are 28 tire distributor members.

For more on the Continental GOLD program, see page 38. — Greg Smith

TIA offers training on On-Line University The Tire Industry Association (TIA) now offers all of its 200-Level Basic and 250-Level Advanced Training Programs in a Web-based format at the TIA On-Line University.

The traditional TIA video and workbook programs are transposed to an electronic learning management system that precisely tracks the progress of each technician, allowing them to engage and learn the material at their own pace.

On-Line University includes knowledge checks throughout each module, keeping the student engaged in the content while increasing their retention, the association notes. After all of the modules have been accessed and completed, the student is allowed to take the final exam. Trainees must fulfill the skills demonstration requirement in addition to passing the exam to successfully complete the training.

For more information, see www.tireindustry.org.

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News/views

bites ASE honors Virginia dealer Virginia Tire & Auto’s Chantilly,Va., location recently received Blue Seal of Excellence recognition from the National Institute for Automotive Service Excellence (ASE). To qualify for Blue Seal of Excellence recognition, 75% of the auto repair facility’s technicians must be ASE-certified. Company-wide, Virginia Tire & Auto employees hold more than 235 individual ASE certifications.

Bridgestone expands plant Bridgestone Americas Tire Operations LLC (BATO) has begun construction on a $19.5 million expansion project at its Bloomington, Ill. , OTR plant. It is expected to be completed in mid2013. The additional capacity will go primarily to the production of tires used in heavy industry.

Schrader sale is completed Schrader International, manufacturer of sensing and valve solutions including tire pressure monitoring systems (TPMS), reports Madison Dearborn Partners Global VI-A L.P. and certain affiliated investment funds (Madison Dearborn) and members of Schrader’s management team have, through a new company formed for such purpose, completed the acquisition of Schrader from Tomkins Ltd. Madison Dearborn Partners, based in Chicago, is a private equity investment firm.

Yokohama rewards managers Yokohama Tire Corp. recently promoted two people within its Commercial OTR Division. Tim Easter has been named the director of OTR sales. He is responsible for all sales and pricing activities within the OTR tire organization. Mike Baggett has been promoted to national OTR sales manager. He is responsible for national OTR field sales activities.

Sullivan aids military families For the second year in a row, Sullivan Tire Co. Inc. partnered with the Sudbury Military Support Network (SMSN) in May, during National Military Appreciation Month. Their goal was to raise money and awareness for the local organization. For every tire sold at Sullivan Tire’s Sudbury, Mass., store through May 12, the company donated $5 to the local SMSN.

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Hennellys close in on goal: 35 stores Hennelly Tire & Auto Inc. opened its 34th Tire Choice outlet in Florida this month.

The 10-bay, state-of-the-art facility is located in The Villages in Sumter County, west of Orlando. “This is now our third store in this great market!” says Dan Hennelly, chairman and CEO. Hennelly and his wife, Diane, the company’s vice chairperson and CFO, opened their 33rd store in Carrollwood, a suburb of Tampa, last October.

“We will start construction on number 35 in Bradenton, Fla. (Lakewood Ranches) on June 1.

Less than eight years ago, Diane “The Tire Choice team and family continues to grow and provide quality goods and I had a goal of opening 35 and services for our loyal guest throughout Florida,” says Dan Hennelly. stores, and in October we will have accomplished this goal.”

The Tire Choice sells Michelin, BFGoodrich, Uniroyal, Bridgestone, Firestone, Fuzion, Yokohama and Pirelli tires. It is affiliated with the Firestone Family Channel and American Car Care Centers. It is the 31st largest independent tire dealership on the Modern Tire Dealer 100 list.

Cooper raises income-to-sales ratio in 1Q Cooper Tire & Rubber Co. reported net income of $22 million on net sales of $984 million for the first quarter ended March 31, 2012. That compares to income of $16 million on sales of $902 million for the same period last year.

Operating profit for the quarter was up 50%, from $32 million to $48 million. The company’s income-to-sales ratio was 2.2%. Improved price and mix of $71 million offset $8 million of higher raw material costs during the quarter. Sales volumes were slightly lower than 1Q 2011.

North America Tire Operations achieved net sales of $698 million during the first quarter, up 8% from 2011 sales of $644 million. Cooper’s total light vehicle shipments in the U.S. decreased 6.1% during the quarter, compared with a total industry decline of 5.8% as reported by the Rubber Manufacturers Association. The segment’s operating profit was $23 million, or 3.3% of net sales.

Bobit buys ‘Heavy Duty Trucking’ Bobit Business Media, the parent company of Modern Tire Dealer, has acquired Newport Business Media. Newport’s publishing properties include “Heavy Duty Trucking” (“HDT”) magazine.

In addition to “HDT,” the acquisition includes TruckingInfo.com, “Heavy Duty Aftermarket Journal” and the Newport Poster Network. “’Heavy Duty Trucking’ is the most recognized and honored magazine in the commercial vehicle field, and Truckinginfo.com is the number one website in trucking,” says CEO Ty Bobit. “We’re thrilled to have these quality properties, along with their experienced staff, as part of our company. Their addition makes Bobit the largest fleet media company in the world.” ■

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Ludwig Report

Tire prices are high and more increases are on the way

T

he bad news is that raw increased from $3.37 a gallon at the beginning of 2012 to material costs continue about $4 a gallon at the end of March. Truck tire sales were to increase. In Decemflat in March, despite higher diesel prices. Retreaded tire ber 2011, butadiene was $1.03/ sales increased 5% in March after falling 9% last month. lb., in April 2012 it was $1.45/ lb. Other representative raw maPremium tire costs are flat... for now terial comparisons (per pound) In comparing March 2012 with February 2012, average are: styrene, 56 cents then to cost and selling price for a size 215/60R16 major brand tire 66 cents now; carbon black, 50 was flat. The average cost for a 215/60R16 private brand tire cents then to 60 cents now; and was down 2% while the selling price was down 1%. Dealers natural rubber, $1.55 then to report that consumers are looking into buying used tires. $1.72 now. Yes, tire prices are

By Saul Ludwig high, and even as consumers Pricing seen as a normal to aggressive are balking, tire manufacturers cannot absorb those cost In March 2012, 60% of passenger tire dealers saw pricincreases, so higher tire prices are on the way. And also don’t ing as normal while another 25% saw it as aggressive. The overlook higher transportation costs as diesel prices have remaining 15% saw it as firm. On the other hand, 47% of surged. The other thing driving tire costs higher is the steady truck tire dealers saw pricing as normal while 35% saw it creep in the average size of the tire as OE auto companies as very firm and 18% saw it as aggressive. have gravitated to large high performance tires with each new model that comes along, and the consumer doesn’t understand the implications Dealers NOV DEC JAN FEB(R) MAR(P) MAR(11) for future tire costs as they drive off in their new car. And finally there may be some good news.

Passenger tire Strong new car sales are positive for replacement Will improve 33% 38% 46% 47% 40% 60% demand. It is encouraging to see gasoline prices Will worsen 13% 6% 23% 6% 5% 0% recede a bit this month and with the economy Will stay level 53% 56% 31% 47% 55% 40% improving (albeit slowly), I’d expect miles driven Truck tire to turn positive soon.

Will improve 25% 39% 60% 43% 59% 75%

How dealers view near-term business

Monthly survey

Will worsen Will stay level

8% 67%

8% 54%

10% 30%

0% 57%

6% 35%

0% 25%

A number of independent tire dealers were R-Revised P-Preliminary surveyed concerning current business trends.

Except for tire prices and costs, the results of the March 2012 survey are compared with those of March 2011. Passenger tire inventories are lowering , but still high Fifty-five percent of passenger tire dealers believed Growing U.S. economy gives hope for the future inventories were in line with current business levels, while According to our dealer survey, roughly 55% of passenger 25% believed inventories were too high. The remaining tire dealers believe business will stay about the same over 20% felt inventories were too low. Roughly 59% of truck the next six months while 40% believe it will improve. The tire dealers said inventories were in line with current busiremaining 5% believe it will worsen. As for truck tire deal- ness levels, while 29% felt inventories were too high. The ers surveyed, 59% see business improving while another remaining 12% felt inventories were too low.

35% see business staying about the same. The remaining 6% believe business will worsen. Optimism stems from Service business continues to be strong improving U.S. economic conditions, however, high gas Dealers who provide automotive service reported that prices remain the top concern.

35% of revenues, on average, were generated by service during March. Dealers said service business grew by 5%. ■

High gas prices likely hindering volumes

According to dealer reports, on average, retail sales of new replacement passenger tires were down 2% when compared with March 2011. High gas prices continue to be dealers’ biggest concern as gas prices have steadily

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Analyst Saul Ludwig is a managing director with Northcoast Research Holdings LLC based in Cleveland, Ohio. He concentrates on the tire and chemical industries. He has been writing for Modern Tire Dealer since April 1975.

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Low rolling resistance

Green sweep Environmental awareness and cost savings fuel the development of low rolling resistance tires

By Bob Bissler Part one of two

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here’s a movement sweeping the country.

It’s an ever-increasing emphasis on environmental awareness in

Photo courtesy of Apollo Vredestein

every aspect of our daily lives. As original equipment manufacturers feel the pressure to reduce emissions and lower fuel consumption, they are turning to tire manufacturers to help with the cause. More new car models every year are being fitted with low rolling resistance tires. OEMs and tire manufacturers can now claim many bragging rights for being “green.”

But what if a consumer doesn’t care about eco-friendliness?

There’s another selling point that should get the attention of those consumers — fuel savings.

“Most consumers who purchase low rolling resistance tires are doing so to save money, particularly as gas prices continue to rise,” said Travis Roffler, director of marketing for Continental Tire the Americas LLC. “These are people who own all types of vehicles, not just owners of hybrid or

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electric vehicles. For this reason, Continental provides a handy, online ‘Fuel Savings Calculator’ that allows the consumer to see how much money they are saving over the life of the tire by purchasing a Continental tire with EcoPlus Technology instead of a standard competitor tire.”

Roffler said that in addition to the cost savings, there is also a significant environmental benefit. Each gallon of gas saved means up to 20 fewer pounds of CO2 emissions released into the Earth’s atmosphere. This environmental benefit helps attract consumers concerned about their environmental footprint.

So just who exactly is the consumer who buys low rolling resistance tires?

“Hybrid vehicle owners and customers who express a strong willingness to purchase environmentally friendly products,” said John Aben, senior vice president of sales and marketing at Nexen Tire America Inc. “Also, customers who want to save money on gas.”

All major tire makers have identified this demographic, and agree.

“Customers who purchase low rolling resistance tires are predominantly looking to increase gas mileage in most cases to save money,” said Rick Brennan, vice president of marketing, Kumho Tire U.S.A. Inc. “There are the obvious hybrid owners who seek out these tires, but really it is anyone looking to maximize their fuel economy,” said Julie Porter, product planner, Bridgestone Americas Tire Operations LLC. “Many consumers do not want to change their vehicle type, so this is a good option to improve the fuel efficiency of any vehicle.

“There is no one profile of a low rolling resistance tire consumer,” said Jim Davis, Goodyear brand PR manager with Goodyear Tire & Rubber Co. “Consumers might buy low rolling resistance tires to save money at the pump, or because the money saved over the life of the tire makes purchasing low rolling resistance tires a good value for the price paid.”

Better tires, smarter customers

But there are still more benefits that this consumer is seeking.

“Consumers who purchase low rolling resistant tires are looking for improved performance from their vehicles,” said Henry Kopacz, PR and product marketing specialist with Hankook Tire America Corp. “Whether that is improved fuel economy to help them save some money at the fuel pump, or as their own personal contribution to help lessen their vehicle’s impact on the environment, consumers who are aware of and purchase low rolling resistant tires know the positive benefits this type of tire provides.”

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Dealer programs

‘Have we got a program for you’ The number of tire manufacturers with detailed associate dealer programs keeps increasing

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here are more tire manufacturers with associate dealer programs now than there were just a few years ago. This trend is a reflection of more than competition among major tire manufacturers; it also underscores the strength of independent tire dealers, and their importance to their suppliers.

In order for you to see what tire companies have to offer you, we asked them to describe their associate dealer programs.

Some answered the questions directly.

Others chose to highlight their programs in their own way. One, Cooper Tire & Rubber Co., declined to participate.

Here, in one place and in their own words, is an update on what they have to offer you.

• state-of-the-art sell-out programs, and • discounted merchandise and services from nationally recognized vendors.

The program also provides access to a support team of dedicated Bridgestone Americas retail experts, including local, regional and national sales support, education specialists and a dedicated retail marketing group.

Continental Tire the Americas LLC: GOLD Retailer Program

Bridgestone Americas Tire Operations LLC: Affiliated Retailer Nationwide Network

Bridgestone recently combined its Affiliated Dealer, TireStarz and Family Retail Dealer programs under one umbrella in the United States. The new program will encompass more than 2,500 points of sale, according to the company.

“We’ve listened to our customers and designed one of the most comprehensive retail dealer programs in the industry,” says John Baratta, president of consumer replacement tire sales. “The Bridgestone Affiliated Retailer Nationwide Network is the complete package backed by world-class products and services and a nationwide tire protection plan and repair warranty program.”

The program will offer network dealers the following: • multi-brand product offerings,

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Only independent tire retailers are eligible for Continental’s GOLD Program.

Retailers are defined as “any location that sells to the end consumer and has the equipment in the shop to balance and mount tires.” To date, there are 2,612 dealers participating.

“One of the most undervalued components of the Continental GOLD Program is the fact that our customers, whether retail or wholesale, do not have to compete with us,” says the company.

“Continental Tire does not have any company-owned or operated retail locations or wholesale distribution centers.

Continental is the only major tire manufacturer (that) does not have one or the other or even both.”

There are no participation fees for the Continental GOLD Program.

Continental recently launched a new Dealer Marketing Suite designed to help dealers boost their business potential. The suite provides access to promotional and advertising support that can be customized for the local level through the use of marketing funds.

The Dealer Marketing Suite allows GOLD dealers to order point-of-purchase

material, drive local traffic to their stores with the use of direct mail, create custom ads, and gain access to potential customers in their area.

This program is designed to help GOLD dealers manage their marketing efforts, customize their advertising, build a loyal customer base and most importantly, grow their business.

GOLD dealers are periodically sent special offers. For example, double rewards for attaining target numbers.

Participating dealers also receive pointof-purchase kits for all Continental and General tire promotions.

GOLD dealers earn a set amount of marketing funds for each marketing line purchased. GOLD dealers have the option of using their marketing funds to purchase tire displays: free-standing tire display (one to six tires), wall mounted tire display (one to two tires), a menu board, indoor signage, clocks, and ceiling drums, just to name a few.

As for signage: “We offer face replacement, single-sided signs and double-sided signs in multiple sizes. These signs can be mounted on poles or a building. For those GOLD dealers who have earned or purchased outdoor signage, Continental Tire will send an inspector to check local zoning laws, to inspect current pole(s), and load bearing requirements. We will also have the new pole(s) and/or signs installed.”

Continental also offers a website with business tools. ContiLink.com is a “onestop shop” for GOLD dealers.

GOLD dealers can access all business tools through ContiLink.com. including new sales tracking tools, a signage program, a showroom program, the Engage360 training site, the RPM (Real Performance Motivation) retail sales motivator (in which GOLD dealers can earn points for each marketing line sold and redeem those points), the new dealer marketing suite (DMT), national account/government business, and national promotions.

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Falken Tire Corp.: Fanatic

“We’ve got 30 distributors across the country that are eligible based on a minimum annual purchase requirement of $1 million,” says Scott Batty, project manager.

“They also have to agree to stock five of our eligible (consumer tire) marketing lines, of which there are 11 total.

“To participate in the program from the distributor level, those are the requirements.

We do ask that they stock a minimum of 8,000 units per distribution center (DC).

They have multiple DCs across the country and we want to make sure there is ample inventory in each of those.

“As of today, we have 23 of the 30 signed up. It’s not a retail program; it’s for our regional wholesalers. It’s a program that’s designed to enhance loyalty between our customer, the distributor, and his customer, the dealer or retailer. In other words, the retailer would sign with a given distributor to earn cash rewards on eligible Falken tires purchased from that distributor.”

What does the program mean to tire dealers? Cash rewards, says Batty. “We’ve got what we feel is a very aggressive cash payout schedule. It is a three-tier program, beginning at 100 units per quarter. We call that level ‘Fan.’ At 250 it’s called ‘Fan Plus.’ ‘Fanatic’ is 400 units per quarter.”

There are no participation fees whatsoever. “The dealer’s commitment is we require a 24-unit opening order and they have to agree to display three of our marketing lines and they cannot wholesale tires — they have to be a retailer.”

Two things make Falken’s program unique, says Batty. “First it is truly a quarterly program which means there is no ‘annualizations’; there is no opportunity for catch-up. At the end of the quarter it ends, and in the new quarter you start fresh.

The other thing that makes our program unique is we tend to manipulate the cash payouts quarterly — very aggressively to promote certain lines of our products.

“For example, when we launch our new FK1453 in July, we’ll substantially increase our payouts in each of those levels. The payouts likely will change every quarter.

Dealers won’t be signing up with Falken; they’ll be signing up with their wholesale distributors. It’s a dealer program, it’s just

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that the relationship isn’t direct with them, it’s with their distributor. I believe every program out there is that way.

“Falken has a direct relationship with a retailer, such as Discount Tire, or Sears or TBC. Those programs are usually funded through co-op monies. Associate dealer programs typically are run through wholesale distributors and they go out and solicit the program to their dealers. We will pay the cash rewards directly from Falken to those dealers. There won’t be any pass–through to the wholesalers.”

As for advertising programs, “At this point there is no provision for co-op advertising. It is strictly a cash rewards and then what I call the fluff. To be specific, we are very aggressive with our POS materials, wearables, and we have a new express ship program that they’ll be eligible for.

Top performers can earn four free Falken tires annually. The cash rewards for us are really the focus. We want to be as aggressive as any manufacturer out there with cash rewards.”

Goodyear Tire & Rubber Co.: G3 Express, Tire & Service Network

Only “Authorized Goodyear Dealers” whose business models are aligned with Goodyear are eligible. Interested dealers need to go through Goodyear’s nomination process, which includes: 1. completion of a “satisfactory” facility review completed by the Goodyear field sales representative; 2. successfully completing the Goodyear, Dunlop and Kelly product training; 3. commitment to retail 2,000 Goodyear, Dunlop and Kelly tires annually, per location; 4. participation in the annual Tire & Service Network advertising campaign. Dealers have six advertising packages from which to choose, and they can use their Goodyear co-op dollars to pay for the advertising package they chose.

There are 2,300 Tire & Service Network locations, 1,752 independent Goodyear dealers and 548 company-owned stores participating in the program “The (retail) program is just launching in Canada, and we expect to sign approximately 300 Quik-Link: 800-687-1557 ext. 16114

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Dealer programs Canadian dealer locations to the Tire & Service Network in 2012,” says the company.

There is no fee for the Tire & Service Program. There is a charge for the dealers’ participation in the Tire & Service Network advertising campaign. The cost varies depending on the advertising package the dealer selects. “Most dealers use their Goodyear co-op dollars to pay for their advertising package.”

Goodyear’s Tire & Service Network Program supports both the tire and service side of a dealer’s business. Here are the unique benefits: 1. A “Premium” listing on the goodyear.com Store Locator (Tire & Service Network Dealers show up first). “We drive in market shoppers for both tires and service to their locations through our Store Locator on goodyear.com.”

2. “Consumer rebates (save up to $160) are offered 365 days a year at our Tire & Service Network Dealers’ 15 weeks of ‘Exclusive’ National Promotions that are available only through our Tire & Service Network Dealers.

3. “Associate spiffs are offered 365 days a year for our Tire & Service Network Dealers.”

4. There is a dedicated Tire & Service Network section on goodyear.com that talks about automotive service.

5. Both tire and service training are available.

6. Tire & Service Network Dealers are able to leverage the buying power of a Network of 2,300 locations.

7. The Tire & Service Network is a North American Program, whereby participating dealers in the U.S. and Canada belong to the same network.

8. Tire & Service Network Dealers have a dedicated Goodyear field sales representative.

Hankook Tire America Corp.: The One Program

The recently launched The One (“One” for short) associate dealer program was introduced at Hankook’s 2012 Partners Day meeting in January. Associate Dealers

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that are selected and approved must meet Hankook’s qualification requirements.

Hankook outlined its benefits as follows: Quarterly cash benefits. You can earn cash back for your sales. Your cash rewards are limitless and diverse. You can earn not only cash based on your sales volume, but also an additional bonus for your premium sales. You’ll get paid for your premium sales even if you don’t achieve your quarterly volume rewards. “It’s simple.

We’ll reward you with a check every quarter you achieve your sales objectives for that quarter,” says the company.

Signage: Once your enrollment has been accepted into Hankook’s One Program, you will receive an initial startup kit of helpful Hankook materials to enhance your store and attract your customers.

You’ll be awarded additional displays and signage as your purchases increase and you reach new levels.

Cooperative marketing: Accrue marketing points for your purchases and use them to purchase Hankook POS materials online for your business needs. Your marketing points will begin to accrue once your purchases exceed 250 units per quarter. You can use your accrued balance to purchase from an array of Hankook marketing materials on the new website.

The company’s Hankook One Ad Builder website makes it easy for you to create and build your ads, too.

Hankook One dealers can participate in consumer promotions that include seasonal specials throughout the year.

You’ll also be able to earn travel awards at the end of the year based on your yearend purchases and level achieved. Use your travel certificate to book your next vacation or have the option to convert it into co-op points you can use toward your business.

“In addition to earning travel awards for your purchases throughout the year, you can be invited to exclusive ‘Major League Baseball Nights’ and enjoy a night at the ballpark on us,” the company notes.

By enrolling as a One dealer, you can also be invited to visit Hankook’s Technical Center in Akron, Ohio.

Additional online training and educational opportunities will be available on Hankook’s new Empowerment website.

Kumho Tire U.S.A. Inc.: Fuel

Enrollment in the Kumho associate

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Dealer programs dealers opportunities for increased profits and streamlined processes through a user-friendly, interactive resource hub to conduct business online.

The AAD program is designed exclusively for Michelin’s independent dealers who purchase Michelin, BFGoodrich, Uniroyal and associate brand passenger and light truck replacement tires through Michelin’s nationwide network of Alliance distributors.

There are more than 4,500 retail points of sale in the program. They are served by more than 200 Alliance distributor points of distribution.

The 2012 program offers the following enhancements: Here are some of the POP materials new Premium Fuel dealers will receive upon becoming a participant in the program. New dealers also will receive materials for the current rebate promotion, including a window banner and standee.

dealer program is subject to the approval of Kumho. Direct Kumho dealers are not eligible to enroll in this program.

Associate dealers must be retail dealers only. Internet-based online stores without a physical retail store premise or car dealers purchasing tires to place on used cars waiting to be sold are not eligible. Associate dealers with more than 10% in wholesale sales also are not eligible to participate in this program.

There are 3,600 independent dealers participating in the Kumho Tire Premium Fuel Program.

“Our program only focuses on the UHP segment,” notes the company. “The most significant difference... is the low number of purchased units required to qualify and the high amount of pay out.

You only need to purchase 12 units to qualify for $60. See entire details on the program at www.KumhoTireUSA.com/Fuel.

Michelin North America Inc.: Alliance Associate Dealer (AAD)

The Michelin Alliance Associate Dealer (AAD) program offers independent

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1. A business development fund to support dealer advertising and merchandising with more dealer-friendly guidelines that make it easier to plan, execute and claim reimbursement for advertising.

2. Tools to help AADs manage their business better and market their own “brand” in their community.

3. Financial incentives for dealers who increase their commitment to Michelin and BFGoodrich brands.

“We want to invest in those customers who are committed to selling our tires,” says Bob Schaffner, manager of wholesale distribution development for Michelin North America. “I want to reward the Alliance associate dealer for every tire (he or she) buys. Through our online program and direct deposits, the process will be quick, easy and provide the dealer constant visibility to its purchases and earnings.

“Over the past four years, AADs have outperformed the tire market standard and are important drivers in Michelin’s business,” says Schaffner.

Beyond the basics of the program, dealers have used such program benefits as the marketing fund to improve profitability and competitiveness within the market. The fund allows dealers to utilize Michelin’s marketing abilities and implement advertising and promotions in their dealerships, resulting in increased traffic.

Throughout the fourth quarter, the AAD Road Show will visit more than 40 cities across the country to review 2011 results and detail the plans for the 2012 AAD program.

Toyo Tire U.S.A. Corp.: Driven Program

Any independent retailer who actively sells Toyo tires is eligible for Toyo’s Driven Program.

A 50-unit buy-in of any Toyo product qualifies the retailer to be a Driven dealer; Driven dealers who maintain 100 units or more per quarter will earn cash incentives on eligible products. More than 800 independent Toyo retailers nationwide have signed up for the program; Toyo’s wholesale partners (“Direct Dealers”) help implement it.

Driven dealers are supported with several different tools, including online training, point-of-purchase materials, a No Regrets Trial Offer and a listing in the Dealer Finder on toyotires.com.

What makes their program unique?

“It offers the independent retailer the opportunity to earn cash incentives from a very profitable and trusted brand. They also will be able to take advantage of Toyo training programs, POP material, and national campaigns.”

Yokohama Tire Corp.: Advantage

All full-service retail dealers in the U.S. who market within a reasonable geographic radius from its retail location are eligible for the Advantage Program.

Only purchases made for retail transactions are eligible.

Direct Yokohama dealers and franchisees associated with such dealers are not eligible. There are no participation fees.

“Yokohama offers the most comprehensive associate dealer program in the industry with easy participation and high value rewards,” says Ken Hsu, manager of dealer programs.

Yokohama’s advertising program is an uncapped 3% co-op program to eligible dealers. Cash rewards are paid quarterly and on all products to qualified dealers.

Bonuses can be earned by the distributor sales staff.

An extensive collection of POP materials is also available for participating dealers. ■

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Focus on industry

Good as GOLD Continental shines up associate dealer program

By Greg Smith

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ncentive trips are generally the setting for companies to thank their top dealers for the business and spell out plans for the upcoming year. Continental Tire the Americas LLC (CTA) did just that in Nassau, Bahamas, last month with 260 of its GOLD dealers.

The company also addressed its supply and fill-rate issues from the outset of the meeting. The dealers were told the company is investing heavily in its operations to increase supply.

Bill Caldwell, vice president of marketing and sales, said the company’s $500 million investment in its new passenger and light truck tire plant in Sumter, S.C., is one of several things the company is doing to increase supply.

With the Sumter investment, CTA will have invested more than $1 billion in manufacturing and product development in the United States, Mexico, Ecuador and Brazil since 2006.

Caldwell told dealers that the company also has worked hard to re-vamp its Continental brand tire line-up and is continuing to introduce new lines. “Our commitment to you is to refresh our tire lines and place new products in segments we are not in right now.”

Caldwell added that the company was working on long-term marketing plans to increase brand awareness in order to have more consumers “come in your doors asking for our products.

We don’t want you to have the 100% burden of selling our tires.”

“GOLD dealers are our conduit to the consumer,” Travis Roffler, director of marketing, told Modern Tire Dealer. “Our goal is to be the ‘go to’ brand for our dealers.”

He acknowledged that most dealers are participating in several associate dealer programs, and said his company must constantly refresh its products and continuously build the brand awareness to the consumer. The company has locked in new product launches for the next three years.

In terms of marketing the brands, Roffler told dealers that social media was most “definitely the 800-pound gorilla in the room, and at the end of the day, we want to use it to drive buyers to our website.”

Roffler said that after product-related searches, the “dealer locator” was the most used page on CTA’s website. The company wants to expand its Facebook exposure and have more than one million “likes” by the end of 2013, up from 25,000 at the present time.

The Continental brand is continuing its Grand-Am racing and Major League Soccer sponsorships this year. General tire marketing continues to focus on off-road racing.

Roffler emphasized that the company has simplified its on-line marketing website, www.contilink.com, for GOLD dealers. He said the company has consolidated the way the site functions, and the new design will keep dealers from need-

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Continental’s Bill Caldwell, left, and Travis Roffler, right, are joined by Cory Brown, owner of Tri State Tire and Auto.

Brown runs a single location in Rapid City, S.D., and has two more locations under construction. His business is 95% retail with a 50/50 split between tire sales and automotive service. Brown says he also holds a 50/50 split in tire sales volume between passenger and light truck tires.

ing to open multiple screens to get information by making it available at just one site.

Throughout the duration of the trip, dealers were given individual training sessions on utilizing the new website features.

A key improvement to the site allows GOLD dealers not only to track their purchases, but also to compare them to the levels they need to reach to receive bonuses.

“We tell them what they need to do in order to get to the next level,” said Madonna Conroy, CTA’s marketing programs administrator. The bonuses include: • quarterly cash rewards (75 units a quarter).

• an anniversary bonus, which applies to a dealer after his first 365 days in the program are completed (minimum qualifying bonus: 300 units).

• an annual volume bonus.

• a growth bonus versus the previous year (minimum growth of 10%).

• an incentive trip (2,000 units).

Volume bonuses are based on three levels: Standard (700 units), Select (1,200) and Elite (2,000). The bonus per tire ranges from 75 cents to $1.25; for example, an Elite associate dealer who purchased 2,000 Continental and General tires over the course of the year would receive a volume bonus of $2,500. Continental also would pick up the tab for two to the GOLD Dealer incentive trip; the April 13-18, 2013, trip is a Royal Caribbean cruise aboard the Jewel of the Sea. ■

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Vacation driving checks

From A to Ziegler Based on its size, an RV needs extra care

By Bob Ulrich

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riving 4,000 miles to the Grand Canyon and back in a 30-foot RV has the makings of a memorable trip. Karen Bethel wanted to make sure the memories were good ones.

So she took her vehicle in for service, first to the recreational vehicle dealership to fix the roof and change the oil.

“That’s when they told me the tires needed to be replaced because of dry rot, which I understand is common for

motor homes when you are not using them eight or nine months a year,” she said.

The RV dealership checks and adjusts air pressure as part of its service, but doesn’t sell tires. Bethel called a Ziegler Tire dealership in nearby Canton, Ohio, for help.

The combination retail-commercial dealership had two 53-foot bays and an alignment pit designed for large vehicles. She decided to take the vehicle in for tires after talking with Retail Service Manager Scott Schwab.

“He just explained what happens to the tires and the different tires available to me,” she said. “And he was very nice when I showed up.”

According to a recent automotive service satisfaction survey by “Consumer Reports,” 30% of the female respondents who had stopped using a repair shop said they felt the staff tried to take advantage of them because of their gender. Bethel said just the opposite about the Ziegler Tire staff.

“The store was located right off the highway, so it was easy to get there,” says Karen Bethel, who drove her 30-foot, Class C motor home to Ziegler Tire’s retail and commercial dealership in Canton, Ohio.

Bethel (left), says one of the reasons she brought her RV to Ziegler Tire was the phone etiquette of Scott Schwab (right), the retail service manager. “He explained everything to me.”

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Because the back half of an RV is heavier than the front half, Ren Kamph (pictured) needed the extra lifting capacity of bottle jacks to replace the rear tires.

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The RV was new in 2004 and had 14,000 miles on it. The six original equipment tires that needed to be replaced were Michelin LTX M/S radials, size LT225/75R16, 10-ply. They were manufactured in the ninth week of 2004.

“Holy mackerel, that’s the worst dry rot I’ve ever seen,” said Schwab as he inspected the tires. (For the record, Commercial Service Manager Mike Randolph said he had seen worse.)

Schwab said the tires would have been “a ticking time bomb” had they been driven in the heat out West. The casings would have gotten hot, and with the dry rot, he thought the sidewalls would have zippered.

The full spare, which was stored under the RV, was deemed fit by Ziegler Tire.

Ren Kamph, the tire tech who replaced the tires, said he once worked on a motor coach that had been kept out of the sun.

The seven-year-old tires showed no signs of dry rot or wear.

According to Schwab, Ziegler Tire uses the same undercar service checklist for RVs that it uses for passenger cars and light trucks (see page 44). The free inspection was performed while the RV was being aligned.

The technicians also looked under the hood to make sure the battery, filters, fluids, belts and hoses were in order. The brakes were checked while the tires were being mounted.

Accessories such as wiper blades also were examined.

Schwab gave Bethel two tire recommendations: the Michelin LTX M/S or the Firestone Transforce HT. The price difference was $61 a tire, or $366 for six tires. Bethel chose the Michelins because she liked the ride of the OE tires.

“He said, ‘You’re driving 4,000 miles. If you like how it rode with the Michelins, that’s what you should get.’”

Bethel added she was satisfied with the overall experience, even the price. The out-the-door cost for the six tires, including valve stems and mounting and balancing, was $1,498.12. The alignment was an additional $63.75. ■

Independent retail tire dealership profile Did you know that 21% of all independent retail tire dealers have a “perfect” technician rating? One hundred percent of their techs are ASE-certified.

• • • • • • • • •

Average number of techs per outlet: 5 Average number of service bays per outlet: 7 Average annual income, entry-level tech: $27,425 Outlets that offer alignment service: 87.2% Average ticket price/alignment job: $80.45 Average number of alignment jobs/month: 67 Outlets that offer mounting/balancing: 95.3% Outlets that offer oil/lube service: 94.6% Outlets that sell windshield wipers: 92.6%

Source: 2012 Modern Tire Dealer Automotive Service Survey

Schwab points to the dry rot on an eight-year-old tire (inset). He says it was the worst he has ever seen. “There’s still some wear on the casing, but the rubber can still be brittle. With that old a tire, it’s better to get all six of them replaced.”

With two 53-foot bays, Ziegler Tire’s commercial location can handle everything from an RV to a Class 8 tractor/trailer.

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Vacation driving checks Undercar checklist: Ziegler Tire, “On the Road with Service and Quality since 1919”

Muffler

Tie-rod ends

Resonator

Tie-rod sleeves Idler arm

Pipes Hangers Front U-joints Rear U-joints

Pittman arm Center link Link pins

Control arm bushing Sway bushing Strut R.B. Upper ball joint Lower ball joint

Rack and pinion Bellows

RF

Alignment

LF

CV joints

RR

CV boots

LR

Front springs Rear springs Bearing repack

Recommend

Acceptable

Part

MISC. Recommend

Leaking

SHOCKS/ STRUTS Acceptable

Recommend

Acceptable

Part

Recommend

STEERING (FWD) Acceptable

Part

Recommend

STEERING Acceptable

Part

Recommend

STEERING Acceptable

Part

EXHAUST

The undercar checklist from Ziegler Tire applies to both light and recreational vehicles, according to Scott Schwab, retail service manager at the company’s Canton, Ohio, outlet (see pages 40-41). Technicians also are trained to write down the tire size; make sure each tire is filled to the proper psi; and record RF, LF, RR, LR and spare tire tread depths. For tread depths, protocol is to inform the vehicle owner what is acceptable and what is recommended.

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Sports marketing

Risk vs. reward Sports marketing from the tire manufacturer’s perspective

By Bob Ulrich Part two of two

W

hen J.C. Penney CEO Ron Johnson hired entertainer Ellen DeGeneres to be the face of the company earlier this year, his reasoning was very clear. In an interview on “The Daily Ticker,” he said: “My instinct... is spokespeople aren’t really necessary unless a company is going through a profound change. And because there’s a lot of marketing associated with change, if you can validate that by (hiring) someone who everyone trusts, that can be a powerful advantage.”

Can a celebrity spokesperson or famous athlete profoundly affect business success? Will a close affiliation with a sports team have the same effect? To find out, we asked tire manufacturers what they thought about sports celebrities in particular and sports marketing in general (in part one in our April issue, we looked at sports marketing from the tire dealer’s perspective).

Phil Pacsi, vice president of customer marketing and education for Bridgestone Americas Tire Operations LLC, says in his experience, the pros of using a celebrity or athlete or team to enhance brand awareness outweigh the cons.

“In our case, Mario (Andretti) and the professional golfers lend extra credibility, since Mario spent the majority of his legendary racing career on Firestone brand tires, and the golfers utilize Bridgestone Golf products.

Continental is the Official Tire of Major League Soccer (MLS) and all of its teams. It’s also the Official Tire and exclusive tire supplier to all of the Grand-Am Road Racing Series, including the Rolex Sports Car Series and Continental Tire Sports Car Challenge Series.

2010-2011 Continental market share and unaided brand awareness 15 2010

2011 3.4%

12

12.1%

“The Official Tire of...”

Tire brands have been represented by a lot of athletes over the years. Some became iconic pairings, such as Olympian Carl Lewis (in red pumps!) and Pirelli, hall of fame golfer Arnold Palmer and Cooper, and racing legend Mario Andretti and Firestone.

After 40 years together, Andretti still signs autographs at the grand openings of Firestone Complete Auto Care stores.

Bridgestone Americas Inc. spends tens of millions of dollars on sports marketing annually. “It’s a sizeable investment and a good chunk of our overall marketing spend,” says Dan MacDonald, vice president of community and corporate relations.

The Bridgestone brand is the “Official Tire” of the National Football League, National Hockey League and PGA Tour. The company also has sponsorship deals with the Tennessee Titans and the Indianapolis Colts in the NFL and the Nashville Predators in the NHL. Bridgestone’s sister company, Bridgestone Golf, has professional services contracts with a number of golfers, including Fred Couples, Paula Creamer and Lee Trevino.

The Firestone brand is the Official Tire of the IZOD IndyCar Series and Firestone Indy Lights, as well as Major League Baseball (MLB).

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8.7%

9

70.9% 1.0% 6

6.8%

5.8% 45.8% 25.0%

3 17.0%

0

Major League Soccer (MLS)

Grand-Am

Continental’s Major League Soccer and Grand-Am sponsorships have been very successful in increasing brand awareness. (Source: Continental)

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Sports marketing “When you look specifically at MLS and Grand-Am, there are very few athletes that transcend their sport or their specific market, so it would be difficult to build an entire brand around them as an individual,” says Travis Roffler, director of marketing for Continental Tire the Americas LLC. “For example, David Beckham is one of the most recognized players in the game of soccer, but he plays for the LA Galaxy.

It would be difficult to feature him as we seek to target fans in the New York area who relate more to the Red Bulls and their players.”

Roffler says other factors to consider when sponsoring an individual include the possibility of a player being traded to another team, getting injured, having a bad race/season, etc. “So ultimately, we felt it was a better direction for our brand to have the ability to connect to a variety of athletes and teams based on the circumstances.

“We have implemented a targeted effort that is locally focused. We made it a priority to be relevant to the audience we are working with by featuring players or drivers that they can relate to directly.”

“The use of a celebrity spokesperson can generate positive or negative market awareness for your company depending upon their actions and reputations,” says John Aben, senior vice president of sales and marketing for Nexen Tire America Inc. “Team marketing is less risky. You typically get what you pay for, whether spending high dollars on a successful

large market team or going cheap and sponsoring a small market team.”

“I think celebrity spokespeople can work and have worked really well on a local basis,” says Fred Koplin, director of marketing communications for Yokohama Tire Corp. “It’s really good if you pick the right person.

“I think on a national basis, it’s much more risky. Costs go up. It’s hard to pick the right person who appeals to a broad spectrum.”

He cites Sullivan Tire Co. Inc. as a dealer that does it the right way. The 56-store chain based in Norwell, Mass., “has done a good job of linking the high-character individual to (its) high-character, highquality, high-service brand.”

Team sports marketing

Yokohama sponsors the NBA’s Houston Rockets; MLB’s Los Angeles Angels of Anaheim and Philadelphia Phillies; and NFL’s Dallas Cowboys, Baltimore Ravens and New England Patriots.

“We want to use sports marketing as a way to build accounts with the fan, build brand awareness, etc.,” says Koplin. “We want that promotion to be activated all the way through.”

Yokohama looks at brand awareness and sales trends on a local basis. For example, sales during a promotion are compared to sales made without a promotion.

Hankook Tire America Corp. tends to support professional and college teams as opposed to individual athletes, accord-

Yokohama Tire Corp. also has a multi-year agreement with the New York Yankees which includes a bleacher wall sign in left field at Yankee Stadium.

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Sports marketing ing to Mark Rowe, director of brand communications. This year, Hankook expanded its in-ballpark marketing program, which features signage behind home plate, to 26 MLB teams.

“This branding billboard visibility also carries over into 85% of the country that watches these games on regional sports cable networks,” says Rowe.

“We have some very well-documented examples of what our sports investments do for Hankook’s, as well as our retail partners’ business. A good example is our ‘Spring Great Catch Rebate and Sweepstakes’ promotion.

Dealer enthusiasm for the program is very high, and store level participation rates convince us that sports sell tires.”

Maxxis International sponsors the New York Yankees, Baltimore Orioles, Los Angeles Dodgers and Washington Nationals baseball teams. It also

Sports marketing is “an opportunity to make connections with dealers and bridge the gap between manufacture and sale,” says Rick Brennan, Kumho’s vice president of marketing.

It’s personal

According to Cooper Tire, national awareness in its brand increased dramatically in 1997 with the addition of Arnold Palmer, “coupled with the significant increase in advertising media expenditures for the year.” Michelin North America Inc. hopes to accomplish the same thing with Olympic snowboarding champion Shaun White and its BFGoodrich brand.

As for team sponsorships, a recent report on the effects of NFL sponsorships on brand equity revealed “the expected significant three-way interaction between time, sponsorship and fan

‘Store level participation rates convince us that sports sell tires.’

Mark Rowe, Hankook Tire America Corp.

is a sponsor of the NBA’s New York Knicks. The benefits of team sponsorships are twofold, according to Scott Barker, marketing manager of Maxxis International—USA’s Automotive Tire Division: “international recognition of our signage and increased brand awareness.”

Kumho Tire U.S.A. Inc. sponsors two NBA teams, the Los Angeles Lakers and the Miami Heat (see page 52). It also has contracts with NFL teams, the University of Southern California football team and the United States Soccer Federation (USSF).

Kumho shares a sponsorship of the Worcester (Mass.) Sharks minor league hockey team with C&R Tire Co. Inc. Working with C&R Tire, Kumho has in-game signage, a “Pump up the Volume” video board feature, game program ads and in-game promotions with co-branded T-shirts.

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affinity.” Authors Kirk Wakefield and Anne Rivers came to this conclusion: “Passionate fans... have more positive attitudes toward the official sponsors of the NFL than do less passionate fans,” and that leads to a corresponding increase in sales.

The findings also emphasize “the importance of continuing longer term contracts to build the effects and benefits of the sponsorship linkage.”

Bottom line, sports marketing is more than just a strategy tire manufacturers and dealers are using to sell more tires.

It’s also personal on many levels.

“Without the relationship between our salespeople and our dealers, sports marketing would not work,” adds Yokohama’s Koplin. ■ To see an expanded version of this story, which includes a look at motorsports marketing, visit www.moderntiredealer.com.

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Sports marketing

Sponsorship opportunities abound But tire dealers must get off the sidelines “It’s essential that we encourage dealer involvement in whatever sponsorship opportunity we take advantage of,” says Rick Brennan, vice president of marketing for Kumho Tire U.S.A. Inc. “Consumers don’t go to the manufacturer to buy tires, they go to the dealer.”

Kumho has created various platforms to help dealers get involved with its various sports team sponsorships. That includes its partnerships with the NBA’s Los Angeles Lakers and Miami Heat (see photo above).

During the regular season, the company partnered with America’s Tire Co. for a retail promotion with the Lakers. It featured a sweepstakes for free Lakers tickets, with at least one winner coming from each of the dealership’s 51 participating Southern California locations every week. (Discount Tire Co. Inc. does business as America’s Tire in California.)

Sponsorship opportunities with a professional sports team like the Lakers is not cost-prohibitive for small businesses, says Chris Hayre, director of corporate partnerships for the Los Angeles Lakers Inc. “We recognize that every potential sponsor may have a different budget

A joint promotion between America’s Tire and Kumho received play on the jumbotron during the Lakers-Heat game earlier this year. Wade Helmle, COO of Tire’s Warehouse Inc. in Corona, Calif., and his wife, Rachel, were guests.

and/or objectives, and analyze each sponsorship opportunity with an open mind.

Of course, there is a certain threshold that needs to be met to ensure that a sponsorship is mutually beneficial. The Lakers’ menu of elements can be customized to meet the needs of small and large businesses alike.”

“We have the ability to create customized marketing programs that cater specifically to the goals and objectives of partners of any size,” says Daniel Monahan, manager of corporate partnerships administration for The Heat Group. “With that said, the investment level determines the assets we can provide.”

Kumho encourages its dealers “to come to us for opportunities in areas and regions we currently don’t have sponsorships in,” says Brennan. “The more we can work together, the more success we’ll reap.”

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Business insight

The power of letting go SalesMinded dealers use their greatest assets to grow

By Doug Trenary

I

open a store with potentially a young manager who is a fabulous worker, but lacks coaching skills to grow others?

If you answered yes to these questions, you’re not alone.

Solution: Each of your leaders must sort out the priorities of the business that produce the most results, develop a systematic and consistent environment of coaching others to do those priorities first — not last, and have your leaders understand and get command of the emotions of letting go to grow.

knew it was time for this message. The issue today comes out in nearly every conversation or training session I have with leaders. It comes out with manufacturers. It comes out with owners and managers of independent retail tire dealerships. It comes out with leaders of wholesale locations and/or commercial truck service centers. What’s the issue? Managers are getting bogged down being doers instead of being leaders. Their store’s growth is limited because they won’t let go and let their people be the best assets they can be.

I had a series of phone calls recently with a major tire manufacturer’s commercial sales leadership team. We agreed that one of their key problems with their sales management was that many of their managers (and sales reps) were spending their time on a whole host of activities that produced marginal results — majoring in minors instead of majoring in majors.

At a recent training session with a group of retail store managers, as we “went around the horn” and discussed what challenges they were having to grow store sales, one store manager clarified the problem perfectly.

He said, “When I started in a store over 30 years ago, I could have my hands in just about everything and keep the store Empowering Emp mpowe owerin ring your employees emplo ployees to to do d some ome of your ur duties duties can n free fre you yo ou up p to t perper er in growth mode. Today, there form the key things that will help grow your business, like leaving the store and is so much more to do, and going out and making sales calls in your community. without a change in my habits to get my assistant managers and associates more involved SalesMind principles applied: There’s no better time in all aspects of the store’s business, I just can’t do the key than now to sit down in a series of planned meetings with things for more growth — like leaving the store and going your leaders/managers (meetings that build on each other) out to make some sales calls in the community.” and grind out these ideas into real actions that they in turn Challenge: Is your team stuck in the habit of doing too can incorporate with their own employees: many things themselves instead of empowering others?

Are your stores or business units losing productivity • Priorities: Make an honest list of what really creates the every day — the high-priority work that brings in the real most sales. Is it more training in sales techniques or phone money is not getting done — because other urgent but skills so that more potential buyers are converted (close less-productive work is stealing your team’s time? Did you rates) to customers? Is it finding more ways for sales-

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Business insight people to do less “service” work and make more sales calls?

I had a dealer manager tell me he personally drove 40 miles each way to take two tires to a customer — 80 miles of driving and how much productivity lost? I had another large customer tell me that with more focus on sales priorities and better service teamwork, they believe they could double the actual sales call time of their commercial team. Double.

His punch-line to me: “That’s like doubling my sales force.”

Here’s another tip: I have attendees at my SalesMind seminars make two lists. List one is the things they really like to do each day. As we discussed those activities in an open forum, we all agreed that many of them were simply not productive. List two was the things they didn’t like to do — and we all discovered those activities had the potential to really produce the results desired. Cultivate the habit where your employees will do the things they don’t like to do, and I’ll bet your stores sales will go up.

• Empowering: Leaders get trapped by being doers — they do a task instead of teach it to an employee — and then fall into a dual trap. Trap one is that they never have enough time to get all of the work of the day done. There are simply more tasks on their plate than time available. Trap two is that the associate cannot grow — because they don’t get the chance to learn how to understand the task and then take action to get it done. Leaders need time back and employees need to grow in capabilities.

• Emotions: Do your leaders want to let go? Do they feel threatened if they share responsibility? They may feel, “Aw,

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it’s just easier for me to do it instead of Ron, the assistant manager — it’s just too much of a hassle to go through the whole problem with him.” As a dealership team, you’ve got to sit down together and talk about these emotions. List them out. Why do they exist? What’s the win to conquer them? If your organization can get these feelings out on the table, it’s often the recipe for getting leaders to let go and let others try things in the store — and become real solution-providers and problem-solvers.

So as you go forward this year with your team, stay focused on this truth: We’ll grow if we can tap the potential of the greatest assets we have — the minds, efforts and talents of our people. ■ Doug Trenary, president of Doug Trenary’s Fast-Track Inc., is an awardwinning author, speaker and teacher who has helped companies of multiple sizes, including independent tire dealerships, increase sales and productivity since 1985. His book, “The SalesMind,” focuses on how to establish strong positions with yourself, your buyers, and your time. For more information, email him at info@dougtrenary.com or call (404) 262-3339.

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Counter intelligence

Blah, blah, blog!

Simple steps to improve your content and visibility

I

have a client who is really engaging the digital world with fantastic results. They have built a clean, professional and easy-to-navigate website that’s intended for the average tire shopper; not the enthusiast or weekend auto-crosser, but John Q. Public. The website is targeted toward their main customer base, the local neighBy Wayne Williams borhood tire buyer.

Recently, they asked me to write a series of blogs to assist in their search engine optimization and their continued effort to communicate to their target audience in a friendly and professional manner.

I did a little research on preparing content for social media, and I thought I would pass along what I found.

There are two primary reasons to blog: One is to get your message out, and the other is to get noticed by search engines.

Google has an insatiable appetite for new and fresh information. Posting blogs is a simple and easy way to refresh your Web content and cause Google and others to pay better attention to your digital initiatives. I encourage you to consider the following simple steps to improve your content and visibility.

3. Design a proper layout. A structure that works well in a blog is a skim-able format. People like to skim, so make it easy for them by using bullet points, lists, headers, sub-headers, and short summaries. Make your points consumable and resist the temptation to be too cute or overly creative. An Internet blog is about getting information out quickly and efficiently.

1. Keep your content simple. Content should be short and to the point. In our digital world, people want what they want fast. Don’t make people dig for your point. The old adage of “Tell them what you’re going to tell them, tell them, and then tell them what you told them” is a simple and direct approach. It’s better not to elaborate or make more than a few points. Avoid the temptation to cram too much information or too many ideas into a paragraph, or the entire blog for that matter.

6. Remember your audience. It seems today that so many people are easily offended or overly defensive; then again, maybe it’s just me. I caution you to remember your audience and remember the reason you are writing the article. It should be written to inform and certainly not to offend.

4. A picture is worth a thousand words. A lot can be “said” in a picture. Pictures are how humans interpret words.

If I say, “big, white, fluff y cat,” in your mind’s eye, you visualize a cat, not the words “big, white, fluff y cat.” The right image(s) will help tell the story and communicate the ideas and thoughts you’re trying to express. Again, don’t overdo it.

5. Be yourself. Write your blog in the voice of you. Don’t try to be funny if you’re a serious person. If you are a friendly person, be upbeat and casual. Always be professional, and look at the blog as more than something you have to do. Make it an adventure for you to write and others to read and digest. I took a Dale Carnegie Public Speaking class in the early ’80s, and I remember the instructor saying, “Nobody is more qualified to tell your story than you.” This is so true. It’s your story, your blog, your idea; have at it and don’t be too tentative.

‘Tell them what you’re going to tell them, tell them, and then tell them what you told them.’

2. Start strong, do what journalists do. Journalists use a style of writing or storytelling known as the “inverted pyramid.” The most important or interesting information leads the article. The information is then presented in descending order of importance. Why bury the good stuff deeper in the article? If you do, you’ll lose readers and compromise your message. Many people skim articles and blogs, so I suggest to start strong and finish strong.

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Here’s my simple recap. Decide on your message, and stick to your message. Start strong, clearly stating your intent and most important points first.

The easier the format, the more they’ll read. Insert an image or images that support and clarify the central message. Be yourself; you’re the best you got, go for it. And like Mama said, “Remember who you’re talking to.” ■ Wayne Williams is president of ExSell Marketing Inc., a “counter intelligence” firm based in La Habra, Calif. He can be reached at exsellmkting@gmail.com.

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Focus on industry

BKT (USA) outlines strategies for growth North American sales goal is $220 million in 2014

By Greg Smith

B

KT (USA) Inc. has a strategy for growth that has helped it increase sales rapidly in North America.

The company exceeded its original forecast by over 30% in 2010 and by 25% in 2011. And through the first quarter of this year, it was at 39% of its goal for the whole year. In fact, the company achieved its five-year growth objective of $100 million in sales in North America in just four years.

BKT (USA) is a subsidiary of Balkrishna Industries Ltd., which is based in Mumbai, India. The company is a manufacturer of agricultural, earthmoving, construction, industrial, ATV and lawn and garden tires.

So, what’s the strategy? It’s “been to establish BKT (USA) as a premium brand name with high quality products and provide value,” says Rami Bitran, general manager. He adds that the company is pricing its products lower than the other leading brands in the market.

Another component to BKT (USA)’s success is “we aim to do what we say,” says Bitran. “You must continue to tell the customer what you can and cannot do.

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“We keep our ear to the ground and deliver what the market needs.”

This means continuing to expand its product mix and line-up quickly.

BKT (USA) is 70% agricultural tires and 30% off-the-road, which also includes ATV and other tires that are not specific to the agricultural line.

The company is trying to drive its mix to more of a Rami Bitran, BKT (USA) 50/50 mix in the future. general manager, says the In total, Balkrishna In- company’s strategy includes establishing BKT as a dustries has more than premium brand name with 1,800 SKUs, a number high quality products that which continues to grow provide customers value. rapidly. It introduced 150 SKUs in 2011, with 71 of those SKUs being specific to the North American market. The company plans to launch

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The plant will produce the full product range of BKT (USA) tires. When completed, 25000 Balkrishna Industries will have four tire plants, with a capacity BKT shipped set for 167,000 metric tons at the end of 2012, 224,000 metric tons at the end of 2013, 20000 BKT forecast and 280,000 metric tons at the end of 2014.

To further support its supply needs, Balkrishna Industries has a new mold plant in Dombivil, 15000 Indian, not far from its Mumbai headquarters. The plant is able to produce 270 molds per year.

BKT (USA)’s new business plan, which the company calls 10000 “Top Spot,” is quite ambitious.

The company has already achieved the number one market share in bias rear farm 5000 tires in the U.S.; its new goal is to achieve the top position in radial rear farm and small farm tires by 2014, too.

Knowing the importance of 0 the OE market, the company has 2009 2010 2011 appointed Bill Haney as its sales Not only is BKT (USA) growing rapidly, it also has manager for this segment. “It’s surpassed its forecast every year. the next big initiative for us,” another 150 SKUs during 2012. says Haney. “The OEMs keep working on Since BKT (USA) opened its offices in bigger, larger and higher horsepower units Akron, Ohio, in 2008, it has consistently and we must have tires to meet those needs.” outpaced the industry in growth for its According to Bitran, the company is products. Bitran likes to view sales in terms working with three key distributors in of metric tons, and the chart on this page Mexico, and will sell $20 million worth of shows how quickly the company has grown. tires there in 2012, making it the market Like others, it has experienced product leader. shortages. If not for that, BKT (USA) The company is looking to increase its may have had sales of more than $140 North American sales to $110 million for million last year. “We started 2012, $165 million for 2013 the year overbooked and have and $220 million in 2014. slowly been getting on top of Bitran says that these sales the situation,” says Bitran. would account for 25% of To further help supply, the parent company’s total Balkrishna Industries will start sales objectives in 2014. “Our seeing production coming out whole group is committed to of its new Bhuj, India, factory this vision.” during the third quarter of 2012.

The company recently The plant is being built on 300 moved to new offices in Akacres with the first phase utiron. It has divided its organilizing around 30 acres, with The company recently zation into three sales teams the capability of producing expanded the range to better service its customers 90,000 metric tons of products. of sizes for its TR 171 as the company continues its Tread tractor tire.

Balkrishna Industries is planning Deep growth. In total, the company It is one of more than to invest around $325 million in 1,800 SKUs the com- employs 12 people in its Akthe project, according to Bitran. pany offers. ron operations. ■ Metric tons

BKT (USA) Inc. sales growth

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Focus on dealers

Family-oriented A Moosic billboard emphasizes savings, not brands. There are 27 Jack Williams Tire retail stores.

Bill, Scott, Jason and Tracey showed why a Jack Williams Tire event is wholesale fun

By Bob Ulrich

T Left to right: Tracey, Jason and Bill Williams (along with President Scott Williams) played hosts to a record number of guests.

David Myers (left) and Kevin Burkly of GITI Tire talk with Ken Hess of Hess Automotive Inc.

There is a reason the event’s theme is “Delivering Success.”

hree hundred wholesale customers attended the Jack Williams Tire Co. Inc. 2012 Trade Show in Moosic, Pa., recently. Many of them were there to buy tires, and walked away with anywhere from $1 to $5 in cash per tire, depending on the order.

With more than half of the year left, the big spenders may already have qualified for the dealership’s 2013 Incentive Trip to Cabo, Mexico.

All of the visitors enjoyed the hospitality of the principals, who opened their headquarters and warehouse to 1,063 people. One of the facility’s features is a wholesale call center, which coordinates calls to the eight Pennsylvania warehouses.

Jack Williams Tire has more than 4,000 wholesale customers in Pennsylvania, nnsylvania, New York, New Jersey and Delaware.

Chairman and CEO Billl Williams, President and COO Scott Williams, Executive Vice President and nd General Manager Jason Williams and Vice President Tracey Williams hosted d the 11th annual event.

In all, 29 vendors set up booths. ooths. Six were domestic tire manufacturers: rs: Carlisle Tire & Wheel Co., Continental al Tire the Americas LLC, Goodyear Tire & Rubber Co., Michelin North America Inc. (Michelin Americas Small Tires), Cooper Tire & Rubber Co. (Mastercraft aft) and Yokohama Tire Corp.

Another six were imported orted tire manufacturers or marketers: keters:

American Pacific Industries Inc. (API), GITI Tire (USA) Ltd. (GT Radial), Kumho Tire U.S.A. Corp., Nexen Tire Corp., Nokian Tyres Inc. and Pro Comp USA. Rounding out the vendors were Bartush Signs Inc., Casco USA, Challenger Lifts Inc., CompuSpections LLC, Craft Oil Corp., East Penn Mfg. Co. (Deka), FCC Environmental LLC, Hennessy Industries Inc., Hunter Engineering Co., Jame Enterprises LLC, Pennzoil-Quaker State(Shell Lubricants), Symtech Corp., Tech International, Hallowell, Wheel Collision Center, The Wheel Group (Wheel-1) and Oro-Tek USA. Bill Williams was Modern Tire Dealer’s 2006 Tire Dealer of the Year. ■ Check out MTD’s Facebook page for more photos from the event!

Joe McLenaghan Sr., presisident of McLenaghan Wholeesale Tires Inc. in Havertown, n, Pa., purchased a lot of raffl fle e tickets for the prize drawings. s.

He held a number of the winnning tickets; one of them was as good for $750. There were re seven Major Prizes, including ng $1,000, a 55-inch flat-screen en n television and an Apple iPad3.

3..

Premium Prizes included venn-dor tires, $200 gift cards and a Blu-ray Disc player.

Hennessy’s Bob De Pamphilis demonstrates for Mark Tuthill of Performance Tire in Delhi, N.Y.

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Focus on dealers

Professional focus, investing in growth Tire Pros dealers speak out, ATD responds with more growth opportunities, enhanced online presence

By Bob Bissler

event set a record. “This is the largest gathering of Tire Pros dealers in the history of the franchise,” said Brown. ommunication was a key theme at the American “There are 265 of the industry’s finest sitting here today.”

Tire Distributors (ATD) Tire Pros National BusiThe total number of Tire Pros retail franchises have ness Conference March 18-21, 2012, in San Juan, grown considerably since ATD bought Tire Pros. The Tire Puerto Rico.

Pros program, along with AM-PAC Tire Distributors Inc., Tire Pros National Council Chairman Tom Ceniglis, was purchased by ATD from Itochu Corp. in December president of Tom’s Tire Pros, Abilene, Texas, told the 2008. Today there are 272 individual Tire Pros franchisees general session about upgrades to Tire Pros online presence representing 348 locations. (www.tirepros.com) that were based on dealer feedback.

Brown discussed upgrades to Tire Pros online, including a central communication link with sections on marketing, a business center, an ad center, training, an operations manual and a dealer hub.

He also covered results from a dealer survey conducted by ATD in early March. The survey revealed that 96% of dealers feel ATD is meeting or exceeding their expectations.

Tire Pros dealers also are becoming more Web savvy, with 68% reporting they regularly visit Tire Pros Online.

Brown said that in 2011, 151 dealers joined the network, for a total now of 462 retail points of sales.

ATD added members from six new states in 2011, and Tire Pros locations can now be found in 40 states. Brown said dealers from 38 of those states were attending the meeting.

Ed Mangola, vice president of marketing, said that ATD is expanding advertising into 20 new markets in 2012. Branding initiatives are an important part of the Tire Pros franchise program and will include billboards and print ads. There will be 12 national promotions this year.

Tom Ceniglis, president of Tom’s Tire Pros, Abilene, Texas, reacts as Dave Crawford, Tire Pros vice president of operaDan Brown, executive vice president of sales for ATD, recognized him for his leadership as chairman of the Tire Pros National Council. tions and training, outlined 2012 objectives including branding and training initiatives. The underlying “One of our biggest problems for a long time was com- platform for these initiatives is a Tire Pros focus on profesmunication,” said Ceniglis. “Now our landing page for Tire sionalism. Crawford said that branding is the foundation Pros online gives you everything you need to know. If you of professionalism, and image is first and foremost. want to find something out, you just log-on to your account Crawford also discussed the Tire Pros credit card and if there’s something new, it’s right there on the landing program, which will feature an online quick-screen funcpage. I really believe that we’ve taken our communication tion that launched May 1. He said with the quick screen, to a higher level than it’s ever been.” franchisees can get pre-approval for any customer who Ceniglis also addressed vehicle inspection sheets, which wants the card, which avoids having to tell the customer haven’t always been consistent from store to store. Now they were turned down. all Tire Pros dealers can utilize a new standardized vehicle Crawford also covered the group’s Quick Bay program inspection sheet. that guarantees tire installation in 59 minutes or less.

At the 2011 Tire Pros National Business Conference, Quick Bay offers a 30-day ride guarantee and exclusive there were 179 attendees. Dan Brown, executive vice nationwide roadside assistance and towing. The program president of sales for ATD, announced that the 2012 also stresses ATD’s focus on professionalism.

C

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Wheeling and dealing

includes the DUB Garage Dealer Program with proprietary wheel brands.

Myles Kovacs, president of DUB, explained that the name of his celebrity car magazine, which is popular with the Latino and African American demographic, stands for “Double Dime,” slang for 20-inch wheels.

Kovacs said the 2012 Tire Pros Wheel Program is the result of feedback from Tire Pros Dealer Councils. It will include a wheel volume rebate, Tire Pros branded POS materials, national pricing, an exclusive wheel display program and wheel training at the online Tire Pros University training program.

Bill Berry, CEO and president, said ATD saw 2011 record sales of above $3 billion.

“The importance of that number is it gives us the ability to continue to invest and reinvest in the Tire Pros program,” Berry said.

In 2011 ATD opened eight distribution centers in new markets, and Berry said ATD’s goal is to open 12 new distribution centers, one a month, by January, 2013.

“One of the challenges that we face over the next five years is relevancy,” he explained.

“We’ve got to remain relevant in a world that’s changing far faster that I could have imagined ATD’s leadership includes (left to right): Ed Mangola, vice president of marketing; Dave Crawford, vice president operations and training; Dan Brown, a few years ago. Working together will make this a strategic partnership that can last.” ■ executive vice president of sales; and Bill Berry, CEO and president.

David Insull, director of wheel procurement and marketing, and Brian Moyer, director of wheel sales, outlined ATD’s new marketing alliance with DUB Publishing LLC. The alliance was announced at the 2011 Specialty Equipment Market Association (SEMA) show in Las Vegas, Nev. The marketing plan

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Focus on industry

Destination: Eco-friendliness Bridgestone debuts Turanza, Destination tires

By Bob Bissler

B

ridgestone Americas Tire Operations LLC (BATO) recently launched the next generation of two of its popular tire lines. The Bridgestone Turanza Serenity Plus and the Firestone Destination LE2 were introduced at an event at the Las Vegas Motor Speedway, Las Vegas, Nev. Both tires have the company’s “Eco-Product” distinction for Bridgestone — or Firestone-brand tires designed for improved environmental performance over the predecessor product.

“Our Eco-Product distinction means it has improved rolling resistance, environmentally conscious materials, and reduced tire weight which conserves resources and lengthens tread life,” said Julie Porter, BATO’s product manager, touring and eco products. “This will also be the first eco product we have where it is stamped on the sidewall.”

Bridgestone says the Turanza Serenity Plus features a quiet ride, wet performance, long tread life and ride comfort. It also has improved winter performance and fuel efficiency. It replaces the Turanza Serenity.

All Turanza Serenity Plus products come with increased limited tread wear warranty — the V-rated with a segmentleading 75,000-mile limited tread warranty, an increase of 25,000 miles from its predecessor. Turanza Serenity Plus will be available starting in June in 30 sizes ranging from 15- to 19-inch rim diameters. They will be H-, V- and W-rated.

The Firestone Destination LE2 replaces the Firestone Destination LE. Made for CUV, SUV and light truck applications, it has improved dry performance, ride comfort, a quieter ride and better fuel efficiency.

“In the last 10 years, one of the most significant changes

Rod Hutchinson, Bridgestone’s product manager for light truck-CUV-SUV, points out some of the attributes of the Firestone Destination LE2 to dealers during a launch event at Las Vegas Motor Speedway. The tire is available in 37 sizes.

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The Bridgestone Turanza Serenity Plus replaces the Turanza Serenity. It offers improved fuel efficiency.

in the automotive industry has been the advent of the crossover vehicle,” said Rod Hutchinson, BATO’s product manager, light truck-SUV-CUV. “That has driven changes in tire technology. When we think about a tire that’s designed to suit a crossover vehicle, we need to think more about a quiet and comfortable ride, and more about tuning, than previously.”

Hutchinson said that feedback from BATO’s retail sales associates drove improvements in the tires that were researched and designed at Bridgestone’s Akron tech center.

The Destination LE2 features a 15% improvement in its rolling resistance coefficient, which translates to up to 2% in fuel economy improvement over its predecessor product.

Destination LE2 has been available since the beginning of the month in 37 sizes ranging from 15- to 20-inch rim diameters with T- and H-speed ratings.

“We’re always working to make our products even better for our customers, and we’re excited to bring these next generation tires to market,” said Larry Magee, president, consumer tire U.S. and Canada, BATO. “Both Turanza Serenity Plus and Firestone Destination LE2 are high-demand products for today’s drivers, and we are excited to raise our own bar in providing even more performance as we continue to evolve these brands.” ■

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TPMS

Volvo C30: Driven to program TPMS CEM must undergo relearn step when replacing sensors SUBJECT VEHICLE: 2008-10 Volvo C30.

RELEARN PROCEDURE? Yes, directions follow.

SPECIAL TOOLS NEEDED? No. The tire pressure monitoring system (TPMS) on the 2008-10 Volvo C30 is integrated in the central electronics module (CEM) and uses remote receiver module (RRM) or remote keyless entry (RKE), along with four wheelmounted tire pressure sensors and the driver information module (DIM).

When the vehicle is moving at a speed of 25 mph or faster, the TPMS sensors are activated and transmit their tire pressures and the tire pressure sensor ID once every minute to the vehicle’s RRM or RKE. The RRM or RKE translates and transmit the data to the CEM. This TPMS system is designed to assist the driver with maintaining the correct tire pressure. It cannot alert the driver when there is a serious problem with the vehicle.

When a low tire pressure is detected, the TPMS will illuminate the tire pressure warning light in the instrument panel, and will display a message on the DIM. The wording of this message is determined by the degree of inflation pressure loss.

To remove an old sensor, follow these steps. NOTE: If a new TPMS sensor or CEM is installed, the CEM must undergo a relearn procedure. The tire should be demounted from the wheel using the tire changer manufacturer’s instructions.

Use the following information to avoid damage during demounting and mounting procedures.

1. Raise the vehicle on a suitable support. Remove the tire/wheel assembly from the vehicle.

2. Remove the union nut and carefully remove the sensor body from the tire pressure valve. See Figure 1.

CAUTION: Only factory-mounted wheels are equipped with TPMS sensors in the valves. If the vehicle is equipped with a temporary spare tire, this tire does not have a TPMS sensor. NOTE: When inflating tires with TPMS valves, press the pump’s mouthpiece straight onto the valve to help avoid bending or otherwise damaging the valve.

To install a new sensor, follow these steps.

3. Install the tire on the wheel. Install the tire/wheel assembly on the vehicle.

4. When a new TPMS sensor is being installed, make sure the TPMS has time to learn the sensor ID.

Ready, set — reset

When the tire pressure warning message has been displayed and the warning light comes on, immediately check the air pressure of all the tires and adjust to the specified pressure listed on the tire label. Make sure the warning light goes off. If the warning light stays on, there is a malfunction in the TPMS. See the appropriate manufacturer’s service information.

Figure 1

If a new TPMS sensor or CEM is installed, the CEM must undergo a relearn procedure. Also, the CEM must learn the new TPMS sensor ID by performing a workshop test or by driving the vehicle.

Driving the vehicle for 10 minutes or more at a speed of 25 mph can program the new TPMS sensor IDs. The low tire pressure warning light will remain illuminated until the CEM has all the new TPMS sensor IDs. Using the WS test method, the vehicle has to be parked for 15 minutes or more for the CEM to learn the new TPMS sensor IDs. When the CEM has learned all the new TPMS

1. Place the tire pressure sensor in the wheel hole.

2. Tighten the union screw to 88 in.-lbs.

(10 N.m).

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TPMS sensor IDs, the scan tool will display “OK” verifying the TPMS sensors are learned and the TPMS is functioning properly.

NOTE: Make sure there are no other learn procedures being performed while the CEM is learning the new TPMS sensors. It is possible to learn the TPMS sensor ID from another vehicle. ■

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Information for this column comes from Mitchell 1’s ”Tire Pressure Monitoring Systems Guide” for domestic and import vehicles through 2010. Headquartered in Poway, Calif., Mitchell 1 has provided quality repair information solutions to the automotive industry for more than 80 years. For more information, visit www.mitchell1.com.

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Your turn

Article put ‘wind in the sails’ of reader Dear Editor: I just wanted to take a moment to let you know that I thought Doug Trenary’s February 2012 article in MTD was ooutstanding! It is certainly a real eeye-opener to see the impact jjust one account can make to the bottom line. It’s relatively difficult to be persistent and to have the “SalesMind” discipline to commit to the act of having a door shut in your face multiple times before any real positive benefit. But when that benefit presents itself, the outcome can certainly be worth it.

I just dropped off half of my uniforms to the dry cleaners ffor a heavy h starch h press, and will be committing every Monday morning to calling on customers and gaining new accounts. I will be following up to let you know how it’s going for me.

I appreciate your inexhaustible knowledge in all of these

situations and I can assure you that we will all be better for it.

I’m excited about it, a little “wind in the sails.”

A NAC for quotable quotes:

Phil McConnon, Vice President Allen Trio Tire and Service Inc. Philadelphia, Pa.

Members of our National Advisory Council speak out 1. “Mild weather has allowed the farmers to start their spring work earlier than usual. This has made us busier than usual for this time of year.”

Mike Thompson, President Thompson’s OK Tire Inc. Beloit, Kan. 2. “The soft winter selling season, due to the lack of intense cold and very little snow, should give us a small uptick in demand this spring, unless it is offset by the reduction of miles driven due to gas prices.”

Tony Sagona, President Midtown Tire Inc. Rochester, N.Y. 3. “Consumers lack disposable income; they are using tax returns to catch up on deferred maintenance on older vehicles.”

Tripp Lee, Service Manager Frasier Tire Service Sumter, S.C. 4. “We seem to be thriving by having a higher quality mix of products and not promoting low price imports.”

Mason Wallace, Store Manager Clark Tire Greensboro, N.C.

We asked for a comment from the writer, and he said: “It’s nice to see focus and response skills like Mason’s! That’s why I write these articles, to help and invigorate readers to action!” - Ed.

‘I don’t find Walmart to be a competitor’ Concerning the blog on www.moderntiredealer.com from Editor Bob Ulrich on “Walmart’s size influences its customers, competitors and suppliers,” a reader commented: “I don’t find Walmart to be a competitor at all. They have some internal policies in their tire department (which I won’t discuss) that actually drive customers away. And their pricing is a non-factor in most cases.”

Dave Stanton, Owner Metro 25 Tire Center Mount Pleasant, Mich.

2.

1.

5.

4.

5. “Truck tire 3. sales are soft and passenger and light truck 6. tires are facing stiff pricing competition from the big box stores. Supply is still a problem with passenger, light truck, medium truck, off-the-road, as well as farm tires.”

Gary Van Blaricom, President and CEO Eastern Iowa Tire Davenport, Iowa 6. “Business is very inconsistent, very much like the stock market. We have some very good days, and some not as good. But overall there’s a steady climb in sales. Supply is slowly getting better on truck tires.”

Marty Gilkes, General Manager Jee Wholesale Tire LLC Houston, Texas

Join Modern Tire Dealer’s National Advisory Council

Each month, Modern Tire Dealer is guided and influenced by a select group of readers — members of our National Advisory Council. These members’ opinions are the heart of the monthly Ludwig Report, compiled by well-known industry analyst Saul Ludwig. If you’d like to join this prestigious group, please let us know. We’d love to hear from you. Contact Editor Bob Ulrich at Bob.Ulrich@bobit.com or call (330) 899-2200, ext. 11.

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