SEASONAL TIRE STORAGE Make the space and they will return
KNOWLEDGE IS POWER President Ken Brown has an agenda for TIA THE INDUSTRY’S LEADING PUBLICATION
TOURING+HP
A combination that keeps evolving
CONSUMER DEMOGRAPHICS: Who buys UHP tires and wheels? November 2013 | Vol. 94, No. 11 | $10 | A Bobit Publication | www.moderntiredealer.com
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Features 20 Performance touring tires and the Johnny Depp connection
Make this market segment a star of your product screen
Te Industry’s Leading Publication November 2013, Volume 94, Number 11
Departments 4 Editorial What is a Tier Two tire? Tier Three? Many factors determine brand placement
24 Consumer demographics Independent tire dealers sound of on who their UHP tire and wheel customers are, and how they buy
6 Online
MTD website offers Global Tire Expo news, Web polls and more
8 News/views A slow and steady rollout: RightTurn.com supports car dealerships
30 Be prepared
Plan now for helping your customers survive winter driving challenges
36 Seasonal tire storage
Make space for a service that brings customers back to your shop every fall and spring
42 Knowledge is power
Ken Brown, the new TIA president, looks to strengthen the tire industry via education
18 Your marketplace Dealers report two consecutive months of yearover-year sales increases
60 European notebook An age of indecision over new tires: The issue of tire aging plays out in Europe
62 Counter intelligence Competence and confdence: It’s all about time, talent, training and application
66 Business insight ‘Just the facts, ma’am’: CARFAX launches an automotive service site
68 Business insight Extending customer ‘life cycles’: Increase profts by utilizing 15 relationship-building ideas
70 Focus on industry Multi-brand strategy: SRI gives Falken an associate in North America: Ohtsu
50 Changing of the guard
Randy Groh hands over the reins of the TIA presidency
74 Focus on industry Yokohama plants roots in U.S. soil: New Mississippi factory will roll out 3,000 tires per day
78 TPMS Initialize Land Cruiser sensors when adjusting pressure
89 Your turn
MTD column fortifes ‘the drive to provide amazing customer service’
54 Safety-frst culture
Cross-Midwest says following OSHA requirements is not enough and trains employees to TIA’s standards
81 Products 84 Quik-Link 85 Classifed
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3
Editorial
What is a Tier Two tire? Tier Tree? Many factors determine brand placement
B
e honest. When you hear the phrase “Tier sion asking for quotas on Chinese consumer One tire,” which brands come to mind? tire imports. In response to the petition, the Te answer is easy. Goodyear, Michelin American Coalition for Free Trade in Tires said and Bridgestone are the anchor brands on which tiers do not correspond to performance, but to most dealers base their product screens. price and proft margin. Te coalition said there Tere are a number of reasons why they are were three tiers, and defned them as follows. considered Tier One tires. Tey have the most market share, particularly in the United States. 1. Tier One is made up of the major tire comTey are the fagship brands of the three largest, panies’ premium brands. “Tey carry the highest by far, tire manufacturers in the world. Tey By Bob Ulrich price tags and have the highest proft margins generally command the highest price, and are for the manufacturers.” Examples: Bridgestone, backed by the most advertising dollars. And they are all Goodyear and Michelin. original equipment brands, representing close to 65% of 2. Tier Two is made up of the tire companies’ midthe OE market. market brands. “Te marketing efort for these tires is not Tey ofen are considered the “best” tire in the good- as extensive as for Tier One tires.” Examples: Firestone, beter-best selling strategy. As the “best” tire, quality is Dunlop, BFGoodrich, Continental, Yokohama and Toyo. implied in the eyes of the consumer. Terefore, a higher 3. Tier Tree is made up of “value” brand tires. “Tese price is warranted. tires are marketed to consumers who are more concerned Ten what is a Tier Two tire? Tat question is much with price than a brand name.” Tey also have the lowest harder to answer. proft margins. Examples: GT Radial, Runway, Primewell, Continental AG is the fourth largest Douglas and Riken. tire manufacturer in the world. Te Continental brand has significant I would guess the coalition placed OE market share. And it may not be all private brand tires in the third tier. priced as high as a Michelin (what Personally, I see tire marketing in the brand is?), but ofen matches Tier real world as more of a four-, maybe One pricing. Continental certainly even fve-tier system based on price markets it like a Tier One tire, which points. For example, where would it is in Germany. you put low-cost Chinese imports? Based on the previous criteria, howTe botom of Tier Tree? In their ever, it falls short of the Big Tree. own tier? There are just too many Continental AG is more than $10 markets within markets to defne tiers billion in tire sales behind third place in a hard and fast way. And geography Goodyear Tire & Rubber Co. In adalso plays a role in tier development. dition, the Continental brand has Ultimately, it’s up to you to determine less market share in the U.S. than the company’s associate blanket tiers, and, subsequently, tier market share. brand, General. If Continental is a Tier Two tire, does that Tere is one factor I haven’t addressed that may be the necessarily make General a Tier Tree tire? biggest factor in determining a tier: markup. I’ll leave the General competes against Firestone, which is the main last words to my friend, the late Jerry White of White Tire associate brand of Bridgestone. Wouldn’t that make General Supply in Beaumont, Texas, who once sent me an email a Tier Two tire in the eyes of the marketplace? on the topic based on a blog of mine. You see the dilemma, and why it is so hard to defne tiers. “Ulrich, you are full of prunes. We fnd that the percentage I would think most major brands not calling themselves markup on Michelin and Bridgestone is much less than Goodyear, Michelin and Bridgestone would grudgingly Tier Two brands, and the markup on Chinese imports is accept being classifed as Tier Two tires, and I would the best of all. tend to agree. “We fnd that between Discount Tire, NTB, and Sam’s It is also hard to determine how many tiers there are. Club, the proft margin on the frst two is almost nonWhen a tire company places its brand “in the middle of existent. Some high-end car dealers are also geting very Tier Two,” isn’t it really creating tiers within tiers? Maybe aggressive with their pricing.” ■ tiers should be determined by price point alone. Tiers were a point of contention in 2009 when the United If you have any questions or comments, please email me Steelworkers petitioned the International Trade Commis- at bob.ulrich@bobit.com.
Where would you put low-cost Chinese imports? Te bottom of Tier Tree?
4
MTD November 2013
Quik-Link: 800-687-1557 ext. 22102
Online MODERN TIRE DEALER
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Publisher Greg Smith Greg.Smith@bobit.com (330) 899-2200 ext. 12, fax (330) 899-2209
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Editorial
The right-hand column of our homepage includes our Web poll. A recent poll queried our readers, “Tire pressure monitoring systems — boost or burden?” And the results are: • A boost, we profit from servicing them: 16.1% • A burden, they’re timeconsuming to service: 23.2% • A boost, they save lives: 28.6% • A burden, consumers don’t understand the technology: 32.1% Check it out, and vote on the current Web poll question: “Will the Affordable Care Act change the way you do business?”
(330) 899-2200, fax (330) 899-2209 Editor: Robert J. Ulrich, ext. 11 Bob.Ulrich@bobit.com Managing Editor: Lori L. Mavrigian, ext. 16 Lori.Mavrigian@bobit.com Senior Editor: Bob Bissler, ext. 15 Bob.Bissler@bobit.com Associate Editor: Ann Neal, ext. 18 Ann.Neal@bobit.com
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Modern Tire Dealer makes it easy for you to fnd the latest news and articles for your specifc feld of interest. Check out our Channels section on our homepage, and you will find news and articles broken down into these segments: Performance, Retailing, Wholesale/ Distributing, Commercial, Suppliers, Technology and Auto Service. Click on the “View more” link, and you will get a comprehensive list of the latest articles and news affecting each segment.
The most-read online items are... Cooper is reviewing options after arbitration ruling
Sales South and Texas: Greg Smith Greg.Smith@bobit.com (330) 899-2200 ext. 12, fax (330) 899-2209 Midwest: Michele Vargo Michele.Vargo@bobit.com (330) 899-2200 ext.17, fax (330) 899-2209 West Coast: John Dyal /Te Dyal Company John.Dyal@bobit.com (760) 451-5026, fax (760) 451-5039 West Coast: Marianne Dyal /Te Dyal Company Marianne.Dyal@bobit.com (760) 451-9216 Automotive Aftermarket: Dan Tornton djtinc@gmail.com (734) 676-9135, mobile (313) 410-0945 Classifed Sales: Donna Stewart Donna_Stewart@cox.net (405) 260-1678, fax (405) 260-1684 Reprint Sales: Karen Runion Karen.Runion@bobit.com (330) 899-2200 ext. 10, fax (330) 899-2209
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Cooper sues Apollo for dragging its feet
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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 offces. 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 frst 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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MTD November 2013
Quik-Link: 800-687-1557 ext. 22103
News/views
A slow and steady rollout RightTurn.com supports car dealerships Dealer Tire LLC has found a new way to help car dealerships: RightTurn.com. The online tire buying site was launched in the Dallas/Fort Worth area last year. This year, it is being advertised heavily in Northeast Ohio. “Our goal is to keep developing this and add markets,” says Peter Judy, vice president of sales development and operations for Dealer Tire. “We’re looking to support the (car) dealership.” (The company has yet to identify a third market.) RightTurn.com was created by Dealer Tire to drive online customers to car dealers. That is not surprising, given that the Cleveland, Ohio-based tire dealer sells tires to car dealerships nationwide. Dealer Tire has programs with more than 20 vehicle manufacturers (with notable exceptions General Motors Corp. and American Honda Motor Co. Inc.). It is the second largest independent wholesale tire distributor in the United States with 20 distribution centers. RightTurn.com is Dealer Tire’s new retail arm. The original company, Walter J. Mueller Inc., was founded in 1918. At the turn of this century, Walter’s grandchildren sold off the retail stores and concentrated on Dealer Tire. Now they are back into retailing, this time online. RightTurn.com is similar to American Tire Distributors Inc.’s TireBuyer.com. Both give consumers the information they need to make purchases, plus the ability to buy immediately. In contrast, however, TireBuyer.com caters to tire dealers. According to Judy, the consumer pays for the tire and installation on the RightTurn.com website; the car dealer is made whole upon installation. “We ship the tires to the dealership upon consumer order, and the dealer is billed through their tire program or directly by Dealer Tire depending on whether or not we manage that OEM’s program. This ensures they have the tires on-hand for the consumer install.” RightTurn.com’s brands include Bridgestone, Firestone, Hankook, Pirelli, Kumho, Goodyear, Dunlop, Kelly, BFGoodrich, Michelin, Continental and Cooper. The company recently began running humorous 30-second television ads in Northeast Ohio during prime time. Whereas a 30-second nationwide ad conservatively costs $100,000, a comparative local TV ad costs closer to $1,000. The company’s
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“We won’t let you buy the wrong tire,” says RightTurn.com on its www.rightturn.com website. “Many online tire buying sites return results solely based on tire size.”
RightTurn.com’s goal is to narrow down the hundreds of possible tire options to a few recommended tires.
three ads also can be viewed on YouTube. In Dallas, Dealer Tire sent out its “Right Turn Only Van” to drum up some publicity. As part of the launch, anyone catching the van making a left turn could win a set of tires. The van also was parked at community events, with “tire roadies” handing out gift cards and other prizes, including tires. “We know that people are defnitely utilizing the Web to shop for tires,” says Judy, who estimates the Internet represents from 4% to 6% of the replacement tires sold domestically. — Bob Ulrich
MTD November 2013
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News/views
bites
Big O Tires opens in Colorado A third Big O Tires LLC location in Grand Junction, Colo., has been opened by Kevin and Valerie Brooks. Bee Line names director Bee Line Co. has appointed Mark Simpson as director of strategic accounts. Pronto honors IDUSA International Distributors USA Inc. (IDUSA) has received the 2013 Private Brand Supplier of the Year award from the National Pronto Association. Network has new chairman Ken Maurer, owner of New Yorkbased Big City Automotive, is the new chairman of the Automotive Distribution Network. Omni United opens U.S. D/C Omni United USA Inc. has opened its first tire distribution center in the U.S. The Fairfield, Calif., facility has the capacity to store more than 60,000 tires. NETSA awards scholarships The New England Tire and Service Association (NETSA) has distributed $24,000 in funds to 12 recipients of $2,000 scholarships for 2013. Sulsberger joins Hornsby Tire Hornsby Tire Distributors, an independent regional wholesale tire distributor based in Dothan, Ala., has hired Scott Sulsberger as director of sales and marketing. ARI hires OEM sales director ARI Network Services has hired David Valentine to be director of OEM sales. Del-Nat names finance director Del-Nat Tire Corp. of Memphis, Tenn., has named Ronnie Williams director of finance. Sumitomo breaks ground Sumitomo Rubber Industries Ltd. has begun construction of its first tire factory in the Republic of Turkey. Production at the radial passenger tire plant is expected to begin in July 2015.
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Lawsuit brings differences on the Cooper-Apollo deal into the open On June 12, 2013, Cooper Tire and Rubber Co. and Apollo Tyres Ltd. announced a deal under which a wholly-owned subsidiary of Apollo will acquire Cooper. On Oct. 4, Cooper fled a complaint asking a Delaware court to force Apollo to “expeditiously close” the transaction. The companies’ differences regarding the deal became public with the lawsuit. In its fling, Cooper said Apollo is delaying an agreement with the United Steelworkers (USW), which represents Cooper employees in Ohio and Arkansas. An arbitrator issued a ruling on Sept. 13 requiring Apollo and Cooper to reach new agreements with the USW before the deal closes. Apollo issued a statement denying the accusation. The company said it has indicated to the USW “that it is willing to make material concessions.” Apollo also specifed other “signifcant post-announcement impediments” related to Cooper’s Chinese employees and joint venture partner, Shandong Chengshan Group Co. Ltd. The Chinese employees have stopped producing Cooper-branded tires, and the Chengshan Group has fled a lawsuit to dissolve the joint venture. Apollo said the circumstances in the U.S. and China have created “signifcant and unanticipated costs that go well beyond those Apollo is obligated to bear under the merger agreement.” Apollo said it expects the transaction price to be reduced: “Cooper has acknowledged to Apollo that some price reduction is warranted.” Apollo also claimed Cooper has not met the terms of the merger agreement with respect to the Chinese operation because “Cooper has no control over the subsidiary or access to its books and records.” Apollo asserted Cooper is using the lawsuit to hide its failure to meet transaction-related obligations: “Under the circumstances, Cooper’s decision to fle a complaint at this time is inexplicable and can only be seen as a diversionary smokescreen or an unfortunate acknowledgment that Cooper will be unable to meet its obligations necessary to complete the transaction.” Cooper said in a statement that it “has not agreed that a reduction in share price is warranted.” The company said the situations with the USW and the joint venture partner and union in China “are risks Apollo assumed under the merger agreement.” Cooper added it is not responsible for setbacks in China because “it has been prevented by the joint venture partner and union access to certain operational and fnancial information.”
Toyo U.S.A. has a new vice president of sales Randy Gaetz has joined Toyo Tire U.S.A. Corp. as the company’s vice president of sales. He will report to Roy Bromfeld, chief operating offcer of Toyo U.S.A. A 35-year veteran of the tire industry, Gaetz has previously served in vice presidential sales and marketing assignments at Del-Nat Tire Randall Gaetz has joined Corp., GPX International, Tire Centers LLC and Groupe Michelin. Toyo Tire U.S.A.
MTD November 2013
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News/views
bites
Conti VDO hires tech trainer Continental Commercial Vehicles & Aftermarket has named Sean Lannoo as sales technical training specialist for the company’s VDObranded aftermarket product lines. Nokian to combine units Nokian Tyres P.L.C. announced it will integrate its heavy tires and truck tires profit centers and form a new commercial tires profit center on Jan. 1, 2014. Federal-Mogul has parts app Federal-Mogul Corp. has introduced SmartChoice, a free mobile app for accessing parts information and sharing inspection results with vehicle owners. Former TBC board member dies Robert Schoeberl, a past member of the board of directors of TBC Corp., died on Sept. 19. He was 77. Schoeberl began his career in the automotive retail industry in 1955 at Montgomery Ward & Co. RMA has a new chairman The Rubber Manufacturers Association (RMA) elected Pete Selleck, chairman and president of Michelin North America Inc., chairman of the board of directors. Nitto sponsors documentary A documentary on the late U.S. Sen. Daniel K. Inouye (Hawaii), sponsored by Nitto Tire U.S.A. Inc., has been selected for in-flight showing by All Nippon Airways and Hawaiian Airlines. Vogue Tyre goes hip-hop Vogue Tyre and Rubber Co. is mentioned in “White Walls,” a hiphop music video by Macklemore and Ryan Lewis. The music video was taped at Vogue’s Los Angeles, Calif., warehouse. The company reports it invented the whitewall tire in 1914. Nexen enters U.S. OE market Nexen Tire Corp. marked its entry into the American OE market with a supply chain kickoff ceremony. Nexen’s CP671 will be OE fitments on the 2014 Chrysler 200 and Dodge Avenger.
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Cutting the ribbon at a new Tread Town playground in Massillon, Ohio, are (from left): Doug Nist, city parks department; Kathy Carassaro-Perry, mayor; Russ Boughman, owner of Discount Tire Outlet Tire Pros; and Ron Sinclair, senior vice president, marketing for ATD. There are seven Tread Towns in the U.S.
ATD and Tire Pros dealers open two Tread Town playgrounds Tire Pros Francorp (Tire Pros), a wholly-owned subsidiary of American Tire Distributors Inc. (ATD), and Boundless Playgrounds, a nonproft developer of inclusive playgrounds, have opened Tread Town playgrounds in Massillon, Ohio, and Pasco, Wash. The Tire Pros subsidiary of ATD and local Tire Pros dealers supported the playgrounds with a $100,000 contribution. ATD opened the frst Tread Town playground in 2009. The playgrounds allow children with and without disabilities to play together. Much of a Tread Town playground’s foundation is constructed from recycled rubber, including approximately 400 recycled tires. “Tread Town playgrounds provide safe, positive places for all children to play, learn and thrive,” says Dan Brown, president of Tire Pros. “We are proud to open our sixth and seventh Tread Towns nationally and partner with our local Tire Pros dealers, Discount Tire Outlet Tire Pros and Tri-Cities Battery & Tire Pros, to make these important contributions back into the local communities in which we operate.”
TBC refreshes ‘Midas touch’ brand TBC Corp. is refreshing the branding of its Midas International Corp. subsidiary. A marketing campaign began in October to promote the “Midas touch” brand identity that emphasizes high-quality customer service for auto repair needs. The branding will be rolled out through Web, direct mail, digital media, and traditional print campaigns. The company will air television ads on cable networks, prime time shows, and during NFL and college football games. Midas has nearly 2,250 franchised, licensed, and company-owned shops in 13 countries, including nearly 1,400 in the United States and Canada. Midas became a wholly owned subsidiary of TBC Corp. in April 2012. TBC is No. 2 on the Modern Tire Dealer 100 list of the nation’s largest independent dealers.
MTD November 2013
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News/views
dates
January 17-25 Ontario Tire Dealers Association Winter Conference, Cozumel, Mexico (888) 207-9059 www.otda.com January 21-22 Montana Tire Dealers Association 37th Annual Convention, Best Western Plus, Great Falls, Mont. (406) 256-1005 www.mtretail.com February 6-7 North Central Tire Dealers & Suppliers Association Mid-Winter Conference and Trade Show, Treasure Island Resort & Casino, Red Wing, Minn. (952) 544-6805 www.northcentraltiredealers.com February 19-22 Tire Industry Association OTR Tire Conference, Marco Island Marriott Resort & Golf Club, Marco Island, Fla. (800) 876-8372 (301) 430-7280 www.tireindustry.org March 6-8 Louisiana Independent Tire Dealers Association Annual Convention and Trade Show, Bourbon Orleans, New Orleans, La. (225) 767-7640 www.litda.org March 6-8 Tyrexpo Africa, Sandton Convention Centre, Johannesburg, South Africa +44 (0) 1892 863888 www.eci-international.com March 14-16 Mid-America Tire Dealers Association Annual Convention, Drury Inn at Broadview Place, Wichita, Kan. (785) 286-1110 www.matda.org March 28-29 North Carolina Tire Dealers Association Annual Expo/Trade Show, Marriott City Center & Raleigh Convention Center, Raleigh, N.C. (877) 784-0111 www.nctda.com
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New vice president at Yokohama Tire Corp. Yokohama Tire Corp. has hired Robert Harrelson as vice president of human resources and administration. He replaces Rex Simpson, who retired. Harrelson will oversee human resources strategies, plans and programs in the company’s North American operations. Prior to joining Yokohama, he was a senior director of human resources for Dr Pepper Snapple Group in North America.
Rob Harrelson will lead human resources at Yokohama.
Discount Tire expands to 27 states Discount Tire Co. Inc. has expanded operations to 27 states with the opening of a store in Davenport, Iowa. The company also opened an America’s Tire store in Orange, Calif. Discount Tire does business under the trade name Discount Tire in most of the U.S. and America’s Tire in Oregon, and parts of Washington and California. Discount Tire is No. 1 on the 2013 Modern Tire Dealer 100 with 870 retail stores.
Hankook will build its frst U.S. plant Hankook Tire Co. plans to invest $800 million to build its frst factory in the United States in Clarksville, Tenn. Construction of the company’s eighth global manufacturing plant will begin in 2014, and tire production is expected to begin by 2016. “This new facility will help Hankook Tire accomplish our plan to establish a production base in all major markets,” says Seung Hwa Suh, vice chairman and CEO.
GITI will open two tech centers GITI tire (USA) Ltd. has announced it will open two technical centers in North America and Germany. The company says the move marks a signifcant development in its research and development capabilities. Both technical centers will collaborate with GITI’s existing facilities in China, Indonesia and the United Kingdom. The company now employs over 600 R&D personnel. The North American site will be in Akron, Ohio, and will design and develop passenger car, performance, UHP, SUV/CUV, 4x4, light truck, heavy truck and bus tires for the North American market.
Michelin reduces production of BFG tires at Alabama plant Michelin North America Inc. is reducing production of BFGoodrich consumer tires in the United States due to a drop in demand. On Oct. 1, 2013, the company began implementing an “indefnite” layoff of less than 10% of its workforce at its Tuscaloosa, Ala., plant. The company says the action will “help align production and inventory with current market demand for BFGoodrich passenger and light truck tires.” ■
MTD November 2013
Quik-Link: 800-687-1557 ext. 22109
Your marketplace
Dealers report two consecutive months of year-over-year sales increases
W
hile most of the tire industry Tire sales built momentum is geting ready for the SpeAccording to dealer reports, replacecialty Equipment Market ment tire demand in September imAssociation (SEMA) Show, our survey proved modestly from the results that indicates that dealers haven’t taken their were experienced in August. Indeed, eye of of the prize as the respondents in dealers reported that they sold 0.5% our study noted that demand improved more new tires in September on a yearin September. Moreover, not only was over-year basis, which compares to the September the strongest month that we 0.1% increase reported in August. Truck have seen since last October, it was the By John Healy and Nick Mitchell tire volumes were up as well, as dealers frst time all year that the respondents in reported that their sales increased 1.4% our survey have seen two straight months of year-over-year following a 1.0% increase in August. In the retread busisales increases. Te strong results at retail are consistent ness, volumes were up by more than 3% in September afwith the anecdotal commentary we have heard from the ter being down 0.7% in two previous surveys. channel about the release of pent-up demand, as well as the strong shipment data being reported by the Rubber Selling prices and costs continued to fall Manufacturers Association. In addition to wanting to Dealers reported that tire costs continued to trend know whether the recent demand pick-up that we have lower in September to refect lower raw material costs seen represents the rebound in demand trends in North and, in some instances, the residual pricing realignments America, dealers are watching the Cooper/Apollo drama associated with expiration of the tarif on tires from China. unfold with interest. Until next time, keep the tires rolling. They reported that their effective cost for top-selling branded tires fell 1.5% while tires in the value arena were almost 3.0% less in August. Some of the favorable costs that dealers are seeing are benefting consumers as well, as retail tire prices for premium tires fell 1.1% in September, MAY JUN JUL AUG(R) SEP(P) SEP(12) while prices on value brands were fat.
How dealers view near-term business Dealers
Passenger tire Will improve Will worsen Will stay level
47% 12% 41%
29% 7% 64%
46% 9% 45%
46% 0% 54%
45% 25% 30%
58% 25% 17%
Truck tire Will improve Will worsen Will stay level
47% 20% 33%
19% 17% 64%
29% 0% 71%
53% 0% 47%
27% 0% 73%
40% 20% 40%
R-Revised
P-Preliminary
Monthly survey
A number of independent tire dealers were surveyed concerning current business trends. Except for tire prices and costs, the results of the September 2013 survey are compared with those of September 2012.
Inventory levels continue to improve
Whether it is a function of improving demand or tighter inventory levels, it appears that tire dealers are becoming more comfortable that they have the proper amount of merchandise in stock to meet demand. Almost 62% of the passenger tire dealers we spoke with indicated that they had the optimal amount of inventory on hand (vs. 53% in August), while 38% believe they still have too much inventory (vs. 41% in August). For the fourth straight month, dealers reported much cleaner inventory levels in the truck tire business, as 18% of the truck tire dealers we surveyed indicated that inventories were too high (vs. 9% in August), while more than 82% said it was just right (vs. 80% in August).
Strong September sales in service Dealers remain relatively upbeat
According to our dealer survey, 45% of passenger tire dealers believed business will improve over the next six months, 30% believed it will stay about the same, while the rest think it will worsen. Meanwhile, 27% of the truck tire dealers we spoke with saw business improving and the rest believed that business trends will stay about the same. In short, the collective outlook of the tire dealers in our sample has become more optimistic as evidenced by the table above.
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Sales in the service category, which accounted for more than 30% of the total revenues of the study participants, rose sharply in September. Tire dealers noted that this category increased 3.4% in September, compared to the 4.3% in August. â– John Healy and Nick Mitchell are research analysts with Northcoast Research Holdings LLC based in Cleveland, Ohio. Healy and Mitchell cover a variety of subsectors of the automotive industry.
MTD November 2013
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feature
Performance touring tires and the Johnny Depp connection Make this market segment a star of your product screen By Robert Abram
I
t might seem like a stretch to suggest any connection between movie star Johnny Depp and performance touring tires, but I’m going to suggest a few, most notably: range, execution and popularity. With regard to range, Depp has acted in all types of flms: action (“Pirates of the Caribbean”), animated (“Rango”), comedy (“Dark Shadows”), children’s (“Charlie and the Chocolate Factory”) as well as horror, thriller, musical and drama. Performance touring tires work on many types of vehicle segments: executive luxury (Mercedes-Benz E Class), aspirational luxury (Audi A4), premium luxury (BMW 7 Series), midsize (Honda Accord), full-size (Ford Taurus), crossover SUV, compacts, minivans and sport coupes. With regard to execution, Depp was nominated for three Academy Awards and 10 Golden Globe Awards for bringing to life all types of memorable characters like the iconic Captain Jack Sparrow, Edward Scissorhands, Sweeney Todd and Tarrant Hightopp, the Mad Hater. Performance touring tires excel in many roles as well. Tey achieve a high level of balanced performance providing excellent mileage, ride comfort, handling, low noise and ofen low rolling resistance. Lastly, Depp’s popularity started to take of in the 1990s, especially with a few critically acclaimed performances late in the decade. But the “Pirates” movies led to a meteoric rise in his box ofce draw in the 2000s. Along the same time line, performance touring tires started fnding OE placement in the ’90s at the original equipment level, with afermarket options really ramping up in the 2000s. Tire manufacturers and movie execs alike have realized that performance touring tires and Depp are made of the stuf the public really responds to positively.
when the Mercedes-Benz E550 Sport model with 245/40R18 front and 265/35R18 rear tires were fted with Michelin Pilot HX MXM4 and Pirelli P6 Four Seasons tire options. It was here that Mercedes-Benz made the change from the previous E500 Sport model, switching the tires from Y-rated summer tires to all-season performance touring tires. Tis was the frst time staggered all-season touring tires made their debut on a vehicle. A year later Mercedes-Benz did the same thing with the C300 Sport Sedan with H-rated all-season 225/45R17 front and 245/40R17 rear tires. Tese two vehicles were the start of a new era for performance touring tires.
Origins of the performance touring tire
Te origins of the performance touring tire, like many other newer segments, have their roots set frmly in original equipment. Treads like the Michelin MXV series, Goodyear Eagle, Bridgestone Turanza and Continental TouringContact series shaped the performance touring category, with homologations on many European and Japanese imports in the ’90s. As the auto industry continued to push designs forward, mainstream vehicle wheel diameters grew from 14 inches to 16 inches and above, and speed ratings increased from S and T to H and V. Tese types of tires were natural OE ftments to replace the broad-line passenger and standard touring tires fted to previous models. Wheel diameters continued up to 18 inches and beyond on many luxury vehicles in the 2000s, but I believe the performance touring category took a major step forward in 2007
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MTD November 2013
Afermarket touring category
Luxury brands like Mercedes-Benz realized that many of their customers were unhappy with the ride quality and mileage of the original equipment tires as the rim diameters grew and the aspect ratios dropped. However, customers still responded positively to the appearance of the vehicles with the larger wheels. As a result, many models that were previously fted with ultra-high performance summer tires started geting replaced with performance touring tires. Tese tires still provided a high level of responsiveness without the harsh ride characteristics or spoty mileage of the performance tires used previously. Te afermarket was quick to respond at this point, and tread lines that were primarily OE started flling in the size gaps, and new treads started sprouting up from many manufacturers. In 2013, most major brands have at least an OE and afermarket tread dedicated to the segment, with rim diameters ranging up to 20 inches, aspect ratios ranging down to 35, and mileage warranties as high as 80K. One of the biggest factors impacting the afermarket touring category is the range of sizes and speed ratings. Higher speed ratings and larger rim diameters elevate performance touring over standard touring, and the high
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diameters and lower profles overlap with many popular HP and UHP sizes. Tis brings us to the benefts and challenges of retailing this new segment.
Benefts of retailing
In short, this is a tire that should appeal to a wide range of customers. In the many focus groups I’ve atended, many consumers of mainstream or luxury vehicles used for regular commuting and family transportation reveal they are most comfortable purchasing a tire that performs well in many categories, instead of excelling in one or two. Although generally not as good in pure handling and braking as high performance tires, performance touring tires are able to mix in higher levels of ride quality and comfort as well as higher mileage than most performance tires. On top of that, these treads ofen have very comprehensive size coverage, and as discussed earlier, work with many types of vehicles, including crossover SUVs. Lastly, because the treads ofen have OE ftments, they are no brainers to stock. Covering the OE and afermarket segments at the same time is a bonus for inventory levels. Some might say they are as easy to sell as Johnny Depp, but talent comes at a price.
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Performance touring tires Challenges of retailing
Tires that can do so much so well are bound to command a premium price. Te trouble is that diferent consumers judge value by many diferent criteria. As much as they value a tire that does a lot well, they also value the dollars in their pockets. Plus for most customers, spending money on tires is as appealing as spending it on a root canal. Generally, an aftermarket high performance all-season tire is less than an aftermarket performance touring tire, which is less than an OE performance touring tire. So if your sales group is not well informed about the latest products and technologies found in performance touring tires, it might be more difcult to educate the consumer about the reasons the more expensive tire is worth the price. Additionally, since the performance touring sizes often overlap other segments with similar speed ratings, it can be difcult to make the decision of what sizes to stock in each tread, or which tread should be the “go to” for your sales staf.
Solutions and strategies
Tere is no doubt that a more complicated marketplace favors the more educated and progressive distributor and retailer. So it is in the best interest of a dealer to build a strategy to deal with growing segments like performance touring. Te most comprehensive option is to cover all of the segments in some way, but that is expensive and impractical for smaller distributors. It is not necessary to stock all sizes for all treads, but popular sizes certainly can handle a wider variety of products with minimal risk. A 225/50R17 can ft everything from a Chevy Malibu (S-rated standard touring) to an Audi A4 (H-rated performance touring) to a Ford Fusion (V-rated performance touring) to a Lexus GS350 (W-rated performance touring). Tese are all late-model ftment examples, but earlier vehicles have a bigger mix of traditional high performance tires as OE. That is a wide variety of buyers, performance capabilities and price points. One strategy would be to cover a few popular high-volume OE ftments like the Ford Fusion and Honda Accord and Audi A4; a top tier brand’s performance touring product; a second tier performance touring product; and an entry price high performance all-season tire. To completely
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cover a size like 225/50R17, you’ll need to look into a summer UHP option and also a run-fat option, as so many of the high-end imports used the size for the last 10 years. Tis strategy can cover a lot of ground and can be very efective. Add more OE and an extra tier of high performance and you start to give your customers no excuse to leave or shop around. Some sizes will require more products to be optimal and some sizes will require less. But almost any size that requires a high performance all-season product can beneft by adding a performance touring product.
What does the future hold?
Original equipment continues to support the performance touring segment because the tires are the best option to achieve what OEMs require for many automotive designs. Tey also give many customers what they desire out of the tires on their vehicles: ride quality, handling and mileage. Despite the coverage of the performance touring segment, you still have to qualify the customer. Customers that are true performance enthusiasts or have serious budget concerns might not fit the bill. I’ve talked to consumers who thought the UHP summer tires on their BMW 7 Series handled poorly, and I’ve also talked to customers who thought the performance touring tires on their Acura RSX handled poorly. You have to ask because you never know. But so many other customers will be very impressed with what performance touring tires have to ofer. If you bought stock in Johnny Depp when the “Pirates of the Caribbean” movies kicked of back in 2003, you could be on easy street right now. Tere’s no denying the drawing power of the versatile and talented actor. Te performance touring tire segment is also versatile and talented, combining customer-friendly benefts and businessfriendly revenues. If you make performance touring tires a big part of your plan, you could move toward your own product screen blockbuster. ■ Robert Abram has worked in the tire industry since 1992, most notably with Dealer Tire LLC and Yokohama Tire Corp. He worked as B2B product manager for Tire Intelligence LLC before recently rejoining Yokohama as product planning manager.
MTD November 2013
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feature
Consumer demographics Independent tire dealers sound of on who their UHP tire and wheel customers are, and how they buy By Bob Bissler
T
he domestic ultra-high performance replacement market has grown 900% since 1994, according to Modern Tire Dealer research. 900%! In addition, the number of UHP tire units shipped has increased every year. Tose are nationwide fgures. Are tire dealers, especially the one-store operators, experiencing the same growth in their stores? To fnd out, we asked them about this dynamic market segment, and how they go about selling UHP tires and wheels. Teir answers may surprise you. “Replacement UHP tire sales are up because of OE,” says Freddie Rine, a salesperson at Stoney Hollow Tire, a wholesale operation in Martins Ferry, Ohio. “It’s what the manufacturers are building and it’s what the cars are coming with.” “Te economy still isn’t totally back yet, and it’s geting tougher to sell UHP tires,” says Joy Kokaisel, president of Norm’s Tire Sales in Roseville, Minn., a family-owned business with one retail location. “We are seeing more nice wheels coming out at the OE level, and consumers don’t replace wheels. However, they do replace their UHP tires when they wear out.”
Dealers get more UHP replacement sales due to UHP ftments from OEs, like the 2014 Honda Acura MDX ftted with the Continental CrossContact LX Sport.
Ed Whitehead, president of Ed Whitehead’s Tire Pros, Yuma, Ariz., says his four-store operation has good UHP tire sales because his market has a lot of consumers who drive BMWs and other vehicles that come with UHP tires as UHP demographics original equipment. Kokaisel says her most popular selling UHP brand at Norm’s “Of our passenger tire sales, about 15% to 20% are UHP Tire Sales is Michelin. She describes her UHP customers as tires,” he says. “UHP at OE is why we’re selling more UHP baby boomers who are “middle aged, mid-life crisis-type tires. We replace them with something as good or beter.” people who have some disposable income.” All four of Whitehead’s stores are retail and commercial, Being situated between St. Paul and Minneapolis, Norm’s and he is a member of the Independent Tire Dealers Group. Tire Sales has a large metro area from which to draw customers. “For some of our co-members in California, UHP is a big“We are part of the ACCC buying group and we have promo- ger part of their market because the ratio of that kind of car is tions through them. We also have a Facebook page where we much bigger in an area like Los Angeles or Newport Beach. post rebates and photos of street rods, which helps our UHP More people have money to buy more expensive cars that have UHP ftments on them.” tire and wheel sales.” “Te customers for UHP tire and wheel packages are more youthful and status-oriented people,” says Hank Feldman, president of Performance Plus Tire & Automotive in Long Beach, Calif. “On the tire side alone, we do draw from a broad market area. We have brands like Pirelli that some customers might not be able to fnd in their local area. “Our pricing typically matches most Web prices. We’ll see a customer drive 30 to 40 miles to buy a set of $1,500 Michelin Pilot Sports or Continental CrossContacts.” Tire price is driven more by the wheels because many consumers “are really trying to ft into a Part of Performance Plus Tire & Automotive’s customer base consists of budget,” says Feldman. “Tey want the wheels baby boomers who have disposable income, and they are passionate and need the tires.” about cars such as the classic Mustang. Some will drive long distances Stoney Hollow’s Rine agrees. “Sometimes to buy tires when they can’t fnd what they want in their market.
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Quik-Link: 800-687-1557 ext. 22113
UHP tire and wheel sales consumers are looking for a low-end import UHP tire that’s cheap because they’re spending a couple thousand dollars for the wheels. Tey’re not buying the good Bridgestone, Goodyear or Michelin brands. Tey’re puting on less expensive tires when buying nice wheels.”
Web infuence grows
“It’s really tough to compete with the
Internet,” says Kokaisel. “We don’t put prices on our website because no mater what, with Internet competition, we’re never going to be the lowest. People call us or email us to get prices, and then we can explain what additional services we ofer.” Tose services include bufng a customer’s rims when they buy tires (and they take a beating in the Minnesota winters), Joy Kokaisel and Nick Strohbeen bring UHP customers to Norm’s Tire by offering free services and by maintaining a good word-of-mouth reputation for taking care of the customers.
and free mounting and balancing, with a Hunter RoadForce balancer. “Tose are services they can’t get from a website.” It’s easy for customers to get confusing information online, says Stoney Hollow’s Rine. “A lot of people don’t know enough about what they’re doing to order the right stuf. Tey’re shopping and geting part numbers and saying, ‘I like this wheel.’ Ten they go to a shop and say, ‘Is this for me?’ Tey get the price online, too, and the dealers have to match the prices.” Feldman uses the Internet to sell tires and wheels, and says this segment of his business is growing and will probably overcome the retail business in the next year or two in terms of volume. “Te Web continues to be a growth engine, and it’s really seting the bar on where the pricing is in the market. People who aren’t comfortable buying on the Web are using it as a shopping tool and then walking in to our retail store with what they found, saying, ‘OK, can you match the price?’ and we make the sale.”
A bright UHP future?
“Te UHP replacement tire market is still going to be around in the future,” says Rine. “It’s probably leveling off. Tere was a boom on it a few years ago but I think that’s prety much dried up.” “I think it’s going to continue to grow slowly until the economy improves,” says Feldman. “We don’t get to pick the product that the customers want to buy, or the prices out there,” says Kokaisel. “We have to win them over with service and build our business based on that. Tat’s certainly driving UHP business.” ■
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Quik-Link: 800-687-1557 ext. 22114
MTD November 2013
Quik-Link: 800-687-1557 ext. 22115
UHP tire and wheel sales Consumer Reports rates ultra-high performance tires And the No. 1 brands are... Pirelli and Michelin The annual Consumer Reports (CR) tire test results came out in August 2013, and once again, Michelin ranks highly. This year, CR tested 49 models of UHP summer, UHP all-season and performance winter tires. CR put the tires through a series of tests, including braking and handling on dry and wet pavement, resistance to hydroplaning, and grip on snow and, for all-season and winter tires, icy surfaces. CR also measured rolling resistance, and rated summer and all-season tires on tread life. Based on the testing, CR assigned a score to each tire tested. Here is a list of CR’s recommended tires in the UHP categories, followed by each tire’s score. UHP summer tires: 1. Pirelli P Zero, 78. 2. Michelin Pilot Super Sport, 78.
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3. Yokohama Advan Sport V105, 76. 4. Nokian zLine, 76. 5. Continental ExtremeContact DW, 76. 6. Goodyear Eagle F1 Asymmetric 2, 74. 7. Vredestein Ultrac Vorti, 72. UHP all-season tires: 1. Michelin Pilot port A/S 3, 76. 2. Goodyear Eagle F1 Asymmetric AllSeason, 70. 3. Hankook Ventus S1 noble 2, 66. 4. Pirelli P Zero Nero All-Season, 64. 5. Cooper Zeon RS3-A, 64. Here are brief summaries of the test results. UHP summer tires: The Pirelli P Zero and the Michelin Pilot Super Sport came out on top among 21 tires in the category. The P Zero received excellent ratings for dry braking and handling. Top-rated in CR’s last test cycle, the Pilot Super Sport contin-
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ues to perform well with its precise handling on dry and wet surfaces. It offers the best tread life of any summer tire CR tested. UHP all-season tires: The Michelin Pilot Sport A/S 3 stands out among the 21 models of all-season tires — and many of the hard-core summer tires — for its dry braking and handling. Some other all-season tires have longer tread life, but the Michelin still achieves a very good rating here. The Goodyear Eagle F1 Asymmetric AllSeason came in second with slightly lower dry braking and handling, but strong handling and long tread life. Performance winter: Although not necessarily considered UHP tires, the winners in this category were the Nokian WR G3, Michelin Pilot Alpin PA4 and Nokian Hakkapeliitta R2. They fnished with 66, 66 and 64 points, respectively.
MTD November 2013
Quik-Link: 800-687-1557 ext. 22117
feature
Be prepared Plan now for helping your customers survive winter driving challenges By Bob Weber
P
reparing your customers’ cars for winter is not the routine service it used to be. Not that long ago it was necessary to drain and fll a car’s cooling system with antifreeze every year or two. Sometimes the thermostat was replaced with a higher temperature, “winter” thermostat. Summer tires went into hibernation and the snow tires, ofen with studs, took over the job on the drive wheels. It was unthinkable to head into the temporary tundra without a complete tune-up. Many shops ofer pre-winter check-up specials that include a quick once-over of the vehicle. Obviously, how you price it is up to you. But many dealers like to begin with a one hour labor charge (higher for 4WD vehicles) as a starting point. In that short amount of time, you can: ✔ check and top of the fuids, ✔ inspect all the lights, ✔ check the coolant level and protection, ✔ test the batery/charging/starting system, ✔ inspect and rotate the tires and adjust pressure, ✔ inspect brakes, ✔ inspect exhaust system integrity, and ✔ test functions of the HVAC system.
fushed and reflled. If the alkalinity is too high, especially in a vehicle that calls for extended life coolant, there may be old-style coolant in the system or there’s a mechanical problem that requires repair. Otherwise, the fresh coolant will soon suffer a similar, excessive alkalinity fate. Using test strips is a good show-andtell to sell an important service to your customer. If the coolant level is low, let your customer know. Tere could be a cooling system leak, either external or Test vehicles’ coolant for freeze protection and reserve alkalinity.This can be part internal. Visually inspect the pressure cap seals and the cap’s mating surface of your standard pre-winter check you perform for every customer. for defects. You may have to perform a Te acid test cooling system pressure test to fnd the Once upon a time, installing antifreeze was an annual root problem. Don’t forget to test the pressure cap. ritual. With the advent of “permanent” antifreeze — the kind that could remain in the engine all year ‘round, that ritual Suggestions for the Snow Belt has become as obsolete as the pay phone. Yet, permanent Inspect the belts and hoses visually and squeeze the hoses antifreeze is anything but permanent. Although it may protect to see if they are too sof which could lead to failure. Cool-
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Photo courtesy of Mike Mavrigian
Put a value price on the service, and then market it at a discount. Now, it seems that nearly everything is “all-season.” Tere is all-season coolant, all-season oil, all-season tires and all-season windshield solvent. But that does not mean your customers can just forget winter car care. Becoming stranded due to an impassable mountain pass or a highway-closing blizzard is rather remote yet not unthinkable. Breakdowns, on the other hand, are a bit more likely. Your customers can avoid being stranded if you prepare their vehicles now.
the coolant from freezing for many years, the additives that protect the engine and radiator are generally used up in a few years. Although the newer OAT (organic acid technology) extended life coolant lasts up to fve years, time is not the most reliable factor. Two tests should be done. First, test the coolant’s level of protection against freezing using a refractometer or hydrometer. Tis will tell you if the water-antifreeze ratio is adequate. Ideally, it should be 50/50. Second, test the health of the additive package using test strips. It is essential that the reserve alkalinity is adequate to prevent cooling system corrosion. If the coolant alkalinity is too low, or even on the Preparation includes installing acidic side of normal, the your customers’ winter tires coolant will have to be before the frst big snowfall.
MTD November 2013
Photo courtesy of Continental Tire
All-season tires may get your customers through the season, but for added safety, they need to understand that winter tires are the answer in the Snow Belt.
ing system problems are the number one cause for roadside breakdowns in the winter. Visually inspect the serpentine belt and if you have any doubts, test the groove depth with a go/no-go tool. Tey are available free from your jobber or WD. Te frst snowfall of the season brings with it an extraordinary number of spin-outs and fender benders caused primarily by driver error and worn tires. As you know, all-season tires have a way of lulling many motorists into neglect. If they are about due for new tires, encourage your customers to get them now — before the frst snowfall. Tell them to avoid the rush for tires when winter really hits. For owners with expensive alloy wheels, steel wheels make a
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good add-on sale. Te performance tires can remain mounted during storage, ready to go back on when the weather breaks. If you have the space, or access to additional space, ofer to store their wheels and tires for a reasonable price (see the tire storage article on page 36).
Keeping the spark alive
More cars fail to start in the winter from worn spark plugs than from weak batteries. Of course, extended cranking eventually takes its toll on the batery. If the car is geting close to a scheduled spark plug service — usually around 100,000 miles — suggest a new set of spark plugs. Test the batery, charging system and starting system. Digital analyzers make this a snap, and some ofer a printout that you can staple to the customer’s receipt if everything is OK. At the very least, inspect the batery terminals and cable clamps and check the alternator drive belt condition and tension. A weak batery probably won’t make it through the winter.
Clear it up
Most workers’ commutes will begin before daybreak and end afer nightfall. Good vision is vital. Turn on all the lights and walk around the car. If any are burned out, recommend that the vehicle owner replace them. If any lenses are cracked or broken, ofer to replace them, too, or condensation will likely build up reducing light output. Check the headlights on both high and low beams. Test the turn signals and hazard (four-way) fashers.
Quik-Link: 800-687-1557 ext. 22118
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Winterizing Make sure the headlights are properly aimed. Not only does this help motorists see where they are going, it keeps them from blinding oncoming drivers. If your customer routinely carries heavy loads in
the trunk, make sure the lights are aimed under the same conditions. Cloudy headlight lenses ofer an opportunity to restore your customer’s view down the road. Several afermarket sup-
The winter emergency kit As a service to your customers, staple a copy of this winter emergency kit to their receipts. Another idea is to partner with your local Boy Scout troop to create basic kits with proceeds going to the organization. After all, the Boy Scout motto is “be prepared.”
should buy one or make up one of their own. They need adhesive bandages, gauze, tape, moist towelettes, burn cream and antiseptic. They may want to include scissors, aspirin, tweezers and latex gloves.
Container — A plastic milk crate, storage box with cover, sports bag or airplane carry-on bag works well. Blanket — It quickly
Flashlight and batteries
gets cold in the car if the engine stops running. A couple of those chemical hand warmers are a good idea, too.
— They need to be sure the batteries are fresh and keep a spare bulb, too. Gloves — Work gloves
— They should keep a couple votive candles or pillar candles and matches in a coffee can. They can even melt some snow in the can if they need water. CB radio or walkietalkie — The craze
peaked in the 1970s, but plenty of people (truckers, RVers and survivalists) still use them. Channel 9 is the common emergency channel.
and latex gloves may come in handy. Jumper cables — A
heavy gauge (the lower the number, the better) with strong clamps. They should avoid cheap ones that will melt before they get a dead battery jumped. Knife — A multifunction
knife like a Swiss Army or Leatherman. Radio — Battery-powered or crank-operated.
Cellular phone — Even
better than a CB, as long as there is coverage. First aid kit — They
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Rope or bungees — Twine is usually handy. So are bungees of various lengths. Snacks — Energy bars,
Flares — Emergency
flares and reflectors alert others if they have a breakdown. If they have never lighted a flare, they should practice. It can be a little tricky and scary the frst time.
Candles and matches
keep some cloth towels, paper towels and hand cleaner in the kit.
Rags — Shop rags or old towels come in handy to kneel on as well as for cleanups. They should
granola, dried fruit and beef jerky store well. Tire inflator — This “air in a can” often contains a tire sealant, as well. But they should avoid products that are fammable which could injure them or the tire technician who repairs their tire. They also need to be sure the product is safe for tire pressure monitoring systems. They need to be aware that this is only an emergency fx, remind them that they must have the tire repaired as soon as possible. Tool kit — This should
include a pair of pliers, flat-blade and Phillips screwdrivers (both medium and large bits), an adjustable wrench, tire gauge, knife, work gloves, black vinyl tape and duct tape. Water — A few bottles of water for thirst and other possible uses. Whistle — A loud whis-
tle can help get attention better than yelling.
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Winterizing
Photo courtesy of Mike Mavrigian
pliers ofer products to make cleaning and polishing those allowing the entire wiper blade to stay in contact with the plastic lenses quick and proftable. And your customers will glass. Beam wiper blades have that same advantage plus the immediately see the diference. (Author’s note: I have used extra beneft of staying in contact with the glass at high speeds. the professional 3M kit and it is excellent). Remind your customers not to yank or chop at their wipers Another customer favorite is windif they are frozen to the glass. Tat will shield rain repellent. Although you could probably tear chunks out of the squeegee service the windshield only, explain the causing streaking. Instead, instruct them benefts of treating all the glass. to start the car and turn on the defroster On the windshield, it helps keep as they clear the other windows. the glass free of slush, salt and muck If your shop ofers exterior care, sugby eliminating microscopic pits and gest a good wax job before the snowfakes scratches to which stuf clings. It helps fall. Not only does the wax protect the the wipers do their job. paint, it makes the snow slide right of Repellent also makes it easier to scrape for easier clearing. ice and snow from the windows. When Otherwise, consider entering into a applied to other outside surfaces, ice co-op with a local detailer, car wash or It is one thing to go in the snow, but stopand snow come of with minimal efort. ping is even more important. Brakes get automotive detailer. ■(One type is Aquapel from PPG, which lots of use and the linings (pads or shoes) used to be a professional-only product should be adequate or be replaced. Bob Weber is president of Virginia-based but is now available for shops.) Write Stuff. He is an award-winning Speaking of wipers, suggest replacing the standard blades feelance automotive and technical writer and photographer with winter wiper blades or beam blades. Nothing is as ag- with over two decades of journalism experience. He is an ASEgravating as wipers that only clear one inch of the windshield. certifed Master Automobile Technician, and has worked on And, invariably, that inch is not in the normal feld of view. automobiles, trucks and small engines. Weber is a member of Although they are a litle more expensive, winter blades are the Society of Automotive Engineers (SAE) and numerous other worth the investment. automotive trade associations. He has worked as an automotive Traditional winter blades have a thin rubber sheath covering service technician, a shop manager and a regional manager for the superstructure to keep snow and ice from building up, an automotive service fanchise operation.
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MTD November 2013
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feature
Seasonal tire storage Make space for a service that brings customers back to your shop every fall and spring By Ann Neal
F
rom computer hard drives to retail stockrooms, space always seems to be at a premium. But making room to ofer seasonal Dunn Tire began offering tire storage service in 2006. The company is tire storage service can fll a marketplace need, add currently storing 14,000 tires for customers at its 31 retail stores and a revenue stream and increase customer retention. three warehouses in New York and Pennsylvania. Modern Tire Dealer called six dealerships in Minnesota and North Dakota, states known for harsh winters, to you build a beter relationship with customers and gives you ask if storage of summer tires was available with the purchase of an opportunity to look at their vehicles again. winter tires. All said no, citing lack of space as the reason. “We “Some customers do not have space to store tires, some do not store tires. If we had everyone’s tires here, we’d have no may have space in a garage but do not want to place tires in place for new tires,” was the response from an employee of a it, and others do not have means of transporting their tires. Minnesota dealership. Te person who answered the phone So tire storage service is a convenience for them.” at a dealership in North Dakota said, “I don’t know of anyone When tires are placed into storage, the company’s identifcahere in town who does that.” tion system generates a label with the customer’s name on it. When the customer is ready to swap tires, the identifcation Why two dealers make space system enables Dunn to retrieve the tires and have them at Dunn Tire Service LLC of Bufalo, N.Y., decided to introduce the shop in 72 hours or less. an option for storing of-season tires in 2006. “It isn’t done Dunn Tire is No. 35 on the Modern Tire Dealer 100 list of by everybody, so it’s an opportunity to provide a customer the nation’s largest independent tire dealers. service that’s unique,” says Patrick Logue, managing director Belle Tire Inc. makes space for tire storage services in Michiof retail operations. To learn what providing the gan and Ohio, where it has 87 retail and combination service involved, Logue visited Pneus Touchete retail commercial outlets. Distribution Inc. of Montreal, Quebec, which “We operate a fairly substantial of-season has ofered tire storage for many years. tire and wheel assembly storage program,” When Dunn Tire rolled out its service says Jef Kruse, senior vice president for seven years ago, it was almost an immediBelle Tire. ate success, according to Logue. Today, Te company calls its of-season storage the company has 14,000 customer tires service Tire Valet. Te service involves stored at its 31 locations in New York inserting a customer’s tire and wheel and Pennsylvania, and three warehouses assembly into a custom-designed storage in Bufalo, Rochester and Syracuse. Te bag at the Belle Tire store. A bar-coded charge to store four tires is $39.96. Te label for each assembly is printed at the service is an additional revenue stream and point-of-sale terminal and inserted into the much more. “It’s a great customer retention tool valet bag. A description of the product and because once you have their tires and their In-store graphics promote Belle Tire’s condition is recorded within the POS wheels, there’s a real good chance you will seasonal tire storage program. Tires system. Te valet bags are shipped on keep them as a customer,” says Logue. are electronically bar coded, placed the next delivery truck to Belle Tire’s Unlike repair services, tire storage draws in protective bags and shipped to the distribution center, where the bag’s barclimate-controlled distribucustomers to a dealership for an optional company’s coded label is scanned into the company’s tion center for storage. Belle Tire uses service they want, creating a win-win situ- a bar code-based warehouse manage- system. Each bag is opened and the tire ation for both parties. “Te service helps ment system to track tire location. and wheel assembly is washed in a special
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Tire storage washer. Te assembly is returned to the valet bag and the bag is scanned to a pallet and specifc bin location for storage in the DC. When it’s time to swap tires, a customer only has to phone or email any Belle Tire outlet to return his or her tires. Te valet bag is shipped the following day to the retail store. Te bags remain company property; the customer pays only for the service. Belle Tire charges $80 to store four tires per season. Te price includes removing and reinstalling the assemblies on the customer’s vehicle as well as cleaning and storage. “Te assemblies are stored on standard 5x5 tire pallets on pallet racks within our DC,” says Kruse. “Each valet bag has a unique bar code and is scanned into a specifc location in our DC. We certainly feel that this is a value-added service for our customers which helps to build retention.” Belle Tire is No. 8 on the MTD 100. In October 2013, the company opened its newest store in Lapeer, Mich. Belle Tire stores off-season tires in “Tire Valet” bags in a
Finding space from a third party
306,000-square-foot distribution center. Identifcation tags that show the tire’s owner and the bar codes used to track the tires in Belle Tire’s climate-controlled distribution center are attached to each bag. Customers pay $80 for four tires per season.
In Denver, dealers are fnding space for tire storage services through a company that ofers wholesale storage capacity to providers of tires and tire-related services. Mike Caplinger, the founder of Seasonal Tire Storage Inc., says close to 250 tire dealers, car dealerships and auto repair shops are referring their customers to him for storage of tires. Te family-owned business recently moved to a larger,
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climate-controlled warehouse, its fourth expansion since beginning operations in 2010. “Wholesale customers are generally tire sellers who want to resell our service at a proft to their customers at the point of the tire sale,” says Caplinger, who has 30 years of experience in the auto repair industry.
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Tire storage “Tey pay a reduced rate, but the tire owner is the tire seller’s accessories to tire dealers, car dealers, auto repair shops and customer, not ours. Tat means the tire seller’s shop maintains collision repair centers across Canada. Te company is based control over where the customer goes for their seasonal tire in Ontario and serves more than 2,700 customers through swap. Tat shrewd shop realizes a guaranteed two visits per year four distribution centers. to inspect for brakes, shocks, or whatever else they ofer, not Although Quebec is the only Canadian province requiring to mention the proft from initially selling those winter tires.” winter tires, Gregory says consumers use tire storage services Seasonal Tire Storage also markets pick-up, delivery and throughout the country. “Prety much everyone is ofering storage of tires directly to consumers. The company will some form of storage. Tere is quite a high concentration, transport tires to any location a consumer specifes in the especially in large metro markets across Canada.” Denver area for installation. Customers Te size of tires is helping to drive derequest transportation and storage of mand for tire storage services, according tires via phone or the company’s website, to Gregory. “Te Toyota Corolla and Ford www.tirestorage.com. Focus are coming with 15-inch tires. Te “They contact us, often after being Chevrolet Cruze is coming with 16-inch referred to us by their tire professional, and tires. Tere’s no room in the car to bring we make all the storage, transportation, home the summer tires.” and billing arrangements directly with Te biggest challenge with ofering tire that person,” says Caplinger. storage services is always space, says Gregory. “Te retail customers pay our highest Some dealers use secure public storage units rate, and we’re obligated to transport their or lease warehouse space near their stores. tires whenever and wherever they direct us Te decision to store tires on site comes to. Tat can mean that if their experience down to a realistic business plan. “If you with a given store was unsatisfactory, allocate 500 square feet of foor space and they could direct us to take their tires put racking in, you should be able to get 500 elsewhere next swapping season.” tires there. You know what 500 feet costs you. Te company posts a list of recomYou can charge a reasonable storage fee and Mike Caplinger says Seasonal Tire mended service facilities on its website. Storage Inc., which provides tire even make a proft. Te beauty of it is you “Tere are tire stores that encourage tire storage and transportation whole- store summer and winter tires.” storage and winter tire purchases,” he says. sale services to tire retailers in the “If we believe a tire store is promoting the Denver area, has long-range plans Sofware for of-season storage use of winter tires, we give them status to expand to 36 markets. Atlas doesn’t store tires for its dealers. on our website’s locator map. However, it recently partnered with Tire “We take a look to see how well equipped they are before Storage Solutions Ltd. (TSS), a company that provides sofware we include them on the locator. We want people to gravitate for tracking and organizing of-season tires. Gregory says he toward those shops.” wanted to maintain his company’s focus on distribution while Te company also developed proprietary sofware to man- ofering a storage option to dealers. age and track of-season tires. Te sofware archives images TSS sofware stores data on customers, storage location, of a customer’s tires, creates documentation about a tire and tire changing appointments and tire/wheel status including its condition, and provides up-to-the-minute information condition, brand, model and size. Te proprietary sofware on a tire’s status. also enables dealers to document damage to rims and tires. Caplinger sees opportunities for his company and tire deal- “If our clients have a storage solution, it helps them sell more ers as the public becomes more aware of the safety benefts tires, and that’s how we beneft,” says Gregory. Atlas introduces of winter tires. His long-range plans are to establish Seasonal its customers to TSS, which bills customers direct, he adds. Tire Storage operations in 36 markets. “Te frst new markets TSS sofware is used in tire storage warehouses and car are likely to be Minnesota, Wisconsin, Michigan and Illinois and tire dealerships across Canada, according to Christine because of the amount of winter tire use and the number of Athron, TSS account manager. Dealers can monitor the qualifed inquiries. Tere is so much more people could know condition of tires and wheels to inform customers of the need about winter tires that we believe the tire storage business has for replacements during the changeover process as well as room to grow.” alignment and balancing services. In addition, dealers who ofer a storage service can beter manage tire swap season by People will pay for convenience booking appointments before the frst snowfall. A new revenue stream that strengthens relationships with Tere has traditionally been a higher awareness in Canada than in the United States of the need for winter tires, according customers while generating sales of tire and repair services to Peter Gregory, president of Atlas Tire Wholesale Inc. He is a strong reason to consider making space for tire storage says that wherever there is seasonal business, there is a market service. But the greatest incentive is increased customer retenfor tire storage services. “You are selling a convenience, and tion, according to Athron. “Dealers are not paying marketing people will pay for a convenience. You have an opportunity costs for a customer’s car to be in the shop twice a year on a hoist with a technician looking at it. Tere’s a lot of value for to fll a need and earn money of that service.” Atlas distributes passenger and light truck tires, wheels and a dealership.” ■
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feature
Knowledge is power Ken Brown, the new TIA president, looks to strengthen the tire industry via education By Lori L. Mavrigian
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ncoming Tire Industry Association President Ken Brown has been in the tire industry since he was six years old. Tat’s when his parents, Alan and June Brown, founded the Alan Brown Tire Center in Newport, Ore. His father had been working for his brother-in-law at a Les Schwab tire store in Roseburg, Ore., when he heard the company was looking to expand west of the Cascade Mountains. He applied and was accepted to start a store in Newport. Te Browns moved to Newport and spent two months turning an old lighting store into a retail tire outlet. Today, Alan Brown Tire Center has two stores and 28 employees, including sons Ken and Tad. Ken runs the Newport store, and Tad manages the store in nearby Toledo, Ore. “Te second store was opened in 2001 to capture more of the commercial market,” Brown says. And a third generation is now involved in the business. Tad’s son, Andrew, works in the Toledo store and is quickly learning the tire business. “We are member dealers in the Les Schwab program. We have always said if we could do it all over again we would be dealers for Les Schwab. Tey are the best partners to have.”
A family afair
Brown learned the business from the ground up. “Being that it is a family business, I have always been involved, from sweeping the foors afer school to emptying the garbage cans as soon as I could lif them,” says Brown. “I remember doing the monthly statements on the dinner table afer we cleared the dishes. I started full time at the age of 19 afer atending the Lane Community College’s Automotive Tech program.”
Ken Brown has been working full-time in the tire industry for almost 30 years. He takes over as president of the Tire Industry Association (TIA) this month at the Global Tire Expo — Powered by TIA in Las Vegas.
Did he ever dream of doing anything else? “Tere were always dreams of doing other things in between fat repairs and service calls,” says Brown. “But it was always too much fun to meet with customers and help them. “
Meet the president: Ken Brown profle Name: Ken Brown My age: 47 My family consists of: my wife, Stephanie, and our daughter Annabelle, who is six years old. Stephanie runs her own small business called True Cut Engraving, a growing trophy and awards shop. So I truly have a “trophy wife”!
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The best thing about being a tire dealer today is: the people who you get to spend your time with from employees to the customers. They have become great friends. In my free time, I like to: spend time with my wife and daughter, usually on our sailboat, fshing or in our RV explor-
ing the beautiful Pacifc Northwest. If I could change one thing about the tire retailing business, it would be: to have all technicians trained with TIA’s training programs so we could have a safer industry. If I weren’t a tire dealer, I would be a: tire tech.
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TIA president His dad still comes in almost every morning to read the paper and have a cup of cofee when he isn’t out hunting or fshing. And his mom still works three days a week doing the books. “She still signs my check,” says Brown. “It is nice to have them around to ask questions about operations and to get their advice.”
Taking stands for tire dealers
Alan Brown Tire Center has been a member off the Tire Industry Association (TIA) since 1976. Brown joined the board of directors in 2004. He says TIA has approximately 6,900 members. “TIA does not keep statistics on the exact breakdown of members and how many members are independent dealers, but it is certainly a large percentage. “ Tere are a number of legislative issues that he Ken Brown’s parents, Alan and June Brown, founded the Alan Brown and TIA will focus on over the next 12 months that at Tir Tire ieC Center in New N Newport, portt Ore O Ore., in 197 1972. 972 2 Ken K Ken’s ’s b brother rothe h rT Tad ad d manage manages s tthe h dealership’s second location in nearby Toledo, Ore. afect their tire dealer members. “We will continue to focus on the issues of tire repair, tire aging, used tires and the Right to Repair,” says Brown. on their loved one’s nest egg. Ofen, this tax is paid by Additionally, TIA has been active in the last year educatselling family assets like farms and businesses. Other ing members about health care reform (“Obamacare” or the times, employees of the family business must be laid Afordable Care Act). “We will continue to be a resource for of and payrolls slashed. No one should be punished our members who have questions about how the Afordable for fulflling the American dream.” Care Act will impact them. • Repealing the death tax would spur job creation. “TIA recently announced that it will ofer a self-funded • Te death tax contributes a very small portion of federal group employee benefts solution to its members through revenues and falls particularly hard on minorities. an alliance with Te Association Benefts Solution (TABS), • Typically, two thirds of likely voters support full and a unit of National General Insurance. TIA has been exploring permanent repeal of the death tax. solutions to the health insurance dilemma for quite some time, and we believe that TABS unique solution may be a “Te tire industry is made up of so many family-owned great option for many TIA members.” businesses (including my own), so permanent repeal of the Brown says TIA supports the repeal of the death tax and is death tax is the best solution,” says Brown. working closely with the Family Business Coalition on this And under President Brown, TIA will address the Federal issue. TIA supports the repeal because: Aid Highway Bill. “In 2012, Congress was unable to pass the proposed fve-year • the death tax is unfair. Brown says, “It makes no sense Federal Aid Highway Bill, and setled on a two-year ‘extension.’ to require grieving families to pay a confscatory tax Tis Congress will again try to pass a fve-year bill. TIA will continue to support a fve-year Federal Highway Aid Bill. “TIA opposes a major motor fuel tax increase and the privatization of highways. TIA will stand strongly with the American Trucking Associations in opposition to a weightdistance tax which would eliminate other taxes, including the Federal Excise Tax (FET) on new truck tires. Te elimination of the FET on new truck tires would have a signifcant negative impact on the retread industry. “TIA opposes the FET on tread rubber, passenger tires and the increase FET on truck tires.”
Training, training and more training
Training, always a high priority for TIA, also will be addressed while Brown is in the top ofce. He reports earlier this year TIA released its Farm Tire Service (FTS) training program, and TIA is puting the fnal touches on adding FTS to its Online University. “Many of our commercial tire dealer members have indicated they will add the FTS program to their existing Commercial Tire Service
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MTD November 2013
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TIA president (CTS) and Earthmover Tire Service (ETS) subscriptions. “Our next technician training program, Industrial Tire Service (ITS), will be produced next year and released in the fourth quarter of 2014 or the frst quarter of 2015. “We do a lot of forklif and industrial tires in my company, so I am especially looking forward to seeing it complete. Once ITS is fnished, TIA will have training programs for automotive, commercial, earthmover, farm and industrial tire service, which we believe covers over 98% of the North American tire market. “TIA members have access to the best tire technician training in the world, and we plan to continue updating existing programs and/or developing new ones as the need arises,” Brown says. “I’m also very excited about the continuation of our new consumer education efort, ‘Tire Safety Starts with ....’ With four new topics for 2014, we will have the beginnings of an extensive library of short consumer education videos. Tese videos focus on specifc tire care and maintenance issues so the tire dealers and retailers can promote best practices for drivers and vehicle owners. With unlimited free distribution for everyone and our own YouTube and Google+ channels, the ‘Tire Safety Starts with...’” videos represent our commitment to remain the leader in education and training for the tire industry.” Brown’s goal as president is simply this: “to continue on with government afairs and education as our goals to make the industry stronger.” ■
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Sending a message to the president MTD recently asked its National Advisory Council members the following question: “If incoming Tire Industry Association (TIA) President Ken Brown could accomplish just one thing during his year that would make your business life easier/more proftable, what would that be?” Here is a sample of their responses: 1. “Put together a rewards/points program for technicians and companies enrolled in TIA certifcation programs. Rewards programs can be used to reward certifed employees with things like TIA merchandise or used to offset the cost of certifcation fees.” 2. “Continue to press for further standardization of tire pressure monitoring system (TPMS) hardware across the board.” 3. “I’m not sure that one person can infuence a marketdriven industry. It would be interesting if TIA pursued standardization of used tire sales, as that segment of the business is less regulated than new tires.” 4. “Get rid of Obamacare.” 5. “A high-powered consumer advertising campaign promoting how important tires are for safety with a catchy slogan. Too many people neglect their tires.”
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feature
Changing of the guard Randy Groh hands over the reins of the TIA presidency By Lori L. Mavrigian
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s Randy Groh ends his year as president of the Tire Industry Association (TIA) and prepares to hand over the gavel to Ken Brown (see article on page 42), Modern Tire Dealer asked him about his year in the top ofce.
But I am not fnished. As outgoing president, I will still be involved with the executive commitee as well as other commitees in TIA, and my intention is to continue to work on a dealer “best practice” as it relates to tire service life and tire age.
MTD: What do you feel was your major accomplishment MTD: Were there any surprises during your year working working with TIA? with TIA? Groh: Before becoming president, I was able to push the Groh: I may have been in the tire business too long. Nothing ‘Tire Safety Starts Here” tagline through the marketing com- seems to surprise me anymore. mitee. We also allocated monies for consumer education and a new MTD: Last year when we interWeb page that would have a section viewed you as incoming TIA presidedicated to the consumer. So far, dent, you said that you felt strongly two tire safety videos targeted toward that the association should focus on educating the consumer have been training and government afairs. What produced, with plans for one each progress were you able to make? quarter. With 70% to 80% of tire Groh: We launched the Farm Tire shoppers searching the Web for Service (FTS) program and added the information before they buy tires, it is Spanish translation of the Commercial important that TIA have something Tire Service (CTS) program to the that can help them. Online University. Te progress we’ve In response to the issue of tire made with the On-Line University service life, a number of discussions has exceeded all of our expectations took place between TIA and the and has really opened up the feet manufacturers. I personally signed a market to the CTS program. We leter of request that was sent to the launched another Automotive Tire Rubber Manufacturers Association Service (ATS) Instructor Tour and (RMA) members as well as vehicle have developed a network of more manufacturers. It asked them to than 30 community and technical send to TIA a copy of any policy colleges where we can hold ATS or statements that they might have classes in the future as needed. regarding tire service life as it relates The Earthmover Tire Service to age. Our intention is to publish this (ETS) program was also translated on our upcoming new and improved into Spanish and released during TIA website so that both dealer/ my term as TIA president. I’m very members and the consumer will Randy Groh is vice president of product marproud of what we accomplished as keting for U.S. AutoForce. He will pass the TIA have access to them. far as training is concerned and am presidency torch to tire dealer Ken Brown this Industry relations have improved month during the Global Tire Expo — Powered confdent we are poised to continue over the last year. We came to an by TIA in Las Vegas (see page 42). the growth and success we’ve seen agreement as an industry in regards over the past few years. to tire repair and used tires. TIA’s relationship with the manuGeting Roy Litlefeld, TIA’s executive vice president, to facturers is very strong. head up the eforts in government afairs has been instrumental to TIA’s advocacy work. His wealth of experience on Capitol MTD: Is there anything you regret not being able to Hill has had a positive impact on the industry. TIA has lobbied accomplish? successfully to: Groh: I would have liked to have done more regarding tire • extend the Work Opportunity Tax Credit (WOTC) for service life. Te industry was unable to come to an agreement recently discharged veterans, on tire aging. • lower the rate and raise the threshold on the estate tax, and
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TIA past president • oppose the excise tax on tread rubber, passenger tires and truck tires. TIA’s political action commitee (TirePAC) has seen a revival and membership is strong. MTD: You planned to pay close atention to the membership newsleters. What changes came about? Groh: TIA is now publishing a quarterly TirePAC newsleter to highlight our government afairs work and a State/Provincial Executives Newsleter to improve communication between TIA and the state/provincial associations. In addition, TIA is now sending out monthly e-newsleters to our members. MTD: You were looking to create demand for training videos for auto services. How is that going? Groh: We’ve surveyed some of our retailer members to see what type of training they needed, and judging from their responses we are meeting the needs of the industry with our ATS and tire pressure monitoring system (TPMS) training. We’ll continue to listen to our members, and if there are any areas outside of tires in the automotive service market that require educational resources, we will explore the possibilities of expanding our training programs.
MTD: How closely does TIA work with the RMA? Can you give us some examples of how the two groups work together to get things done? Groh: Te relationship with TIA and the RMA is the closest
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it has ever been. We’ve worked together to fght state legislation on tire repair, tire aging and used tires. On the federal level, we’ve work together on tax bills and tort reform. Charlie Cannon, the RMA’s president, atended the TIA board of director’s meeting in June, and this gave our board members the opportunity to interact with him and gave Charlie a chance to address the board while they were all together.
MTD: What are your duties as past president? Groh: I will continue to serve on the executive commitee, atend board meetings and be an active part of TIA.
MTD: What are you going to do with any free time you have afer handing over the gavel? Groh: I still have my job with U.S. AutoForce, and there is more than enough for me to do related to providing the best programs and service to the independent tire dealer. MTD: Most importantly, what advice do you have for Ken Brown as he takes over the presidency? Groh: Get started right away. With the TIA president’s term being just one year, it is imperative to get started immediately to be able to accomplish your goals. Have fun with it. Troughout my term as president, I have had the opportunity to meet and work with so many incredible people in the industry, many of whom I may not have had the opportunity to interact with had it not been for my role with TIA. ■
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feature
Safety-frst culture Cross-Midwest says following OSHA requirements is not enough and trains employees to TIA’s standards By Ann Neal
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here are no tire busters at Cross-Midwest Tire Co. Instead, the Kansas City, Kan.-based commercial tire dealer employs tire technicians certifed to the safety standards developed by the Tire Industry Association (TIA). Neal Seyfert has built the Cross-Midwest safety program around the distinction between tire changer and tire technician. His position as director of operations includes responsibility for the safety training and performance of Cross-Midwest employees. Te company relies on programs like those developed by TIA, whose training goes beyond the requirements of the Occupational Health and Safety Administration (OSHA). “As a company, we’ve realized there’s a lot more to this industry than the OSHA-required training. We’ve recognized the importance of advanced training through the TIA program,” says Seyfert. He credits TIA’s training with creating a safety-frst culture at Cross-Midwest. “Our safety-frst culture has been created from the top down, and is a complete team efort designed for the safety of us all.” Cross-Midwest is No. 12 on the Modern Tire Dealer list of top commercial tire dealers. Te company operates 14 commercial locations in Kansas, Missouri and Illinois and has approximately 100 drivers. It is No. 82 on the MTD 100 list of the nation’s top independent dealers. “Te TIA training has helped change the culture of our safety program. We have some guys who are 15-year veterans. Tey know the right way to change a tire, but they may not have known the safest way. TIA training is not only about learning how to change a tire, but also how to look for potential harmful situations when changing tires.” Safer workers also bring botom-line benefts to commercial tire dealers, according to Chris Hoogenboom, director of training for TIA. “Look at training as an investment that improves customer satisfaction, lengthens tire life, reduces insurance premiums, reduces employee turnover, improves quality control and increases employee morale.”
Start with the basics
Recognizing hazards is the basis of TIA’s training program. “Tire service can be so dangerous to techs and the motoring public,” says Hoogenboom. “Proper training is essential. TIA built these programs with one thing in mind: Everyone deserves to go home safely at the end of each work day. We do everything we can to make sure that happens.” Te organization began ofering the training in 1997 because commercial tire dealers wanted more than a video and a workbook, according to Hoogenboom. “Tey wanted instructors in front of students so there could be discussion,
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Chris Hoogenboom, director of training for TIA, says safety and training remain the top priorities through technician recertifcation every two years.
questions and, most importantly, answers.” Te frst level of TIA training is called Basic Commercial Tire Service Training and Certifcate Program 200. Te 200 level meets the minimum federal training requirements mandated by OSHA for both new hires and experienced employees in need of documented training. Te 200-level training is approximately four hours in length, and the lessons are delivered online or via a workbook or DVD. Te TIA Online University was created in April 2012 to make the 200-level training available to technicians through an Internet connection. Cross-Midwest was the frst company to enroll its employees, who are required to complete the training online when hired.
Next step is to certify
Afer reaching one year of experience, a technician participates in a 300-level training seminar conducted by a TIA-certifed instructor to prepare for the TIA certifcation exam. A technician who successfully completes the certifcation training and fnal exam receives a certifcate and uniform patch. Dealers who wish to train and certify their employees to TIA’s standards have two options. Te frst is to fnd a TIA-certifed instructor in their area and arrange for training directly with
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Safety the individual. Te second is to send an employee through an instructor training class ofered by TIA. Upon completion of the training, he or she can return to train and certify the remaining employees. Cross-Midwest chose the second route, and Seyfert became a certifed instructor in September 2012. People who atend instructor training are surprised to discover what they don’t know about safety, says Hoogenboom. “Tey think they are doing everything right but fnd out there is so much more to safety than what they thought.” Hoogenboom and Seyfert atended the same instructor
TIA says technicians who complete its 300-level certifcation seminar receive the most comprehensive safety training in the industry. Technicians who complete seminars receive a clothing patch to indicate their status.
certifcation class in Baltimore, Md. She says Seyfert shared his ideas for improving the safety program at CrossMidwest. “We discussed what he would change, and the frst thing he did was implement the industry-recommended torque program. I knew then he was serious about changing the safety culture because a torque program is expensive.”
New safety policies
Te torque program at Cross-Midwest involves equipping all service trucks and shops with torque wrenches and having the wrenches calibrated by an outside vendor on a regular basis. In addition, technicians are required to torque every wheel. “Every one of our service trucks and shops has torque wrenches,” says Seyfert. “Our policy is to ensure every lug nut is torqued, and then verifed by a second employee.” Te torque process at CrossMidwest is the standard procedure taught in the TIA program. “We’ve been able to implement several other safety policies with the help of TIA,” says Seyfert. Some of those policies include the use of safety glasses, jack stands and safety cages. Cross-Midwest also requires the use of whip hoses during the infation process so the technician can stay out of the trajectory zone. Te company adopted neon yellow, the recognized color for designating caution, as an employee uniform to protect workers from being hit by other vehicles when working on the roadside or in a parking lot. “We decided to choose the safety yellow color because the safety orange color looked too much like an orange construction barrel on the side of the road,” says Seyfert. For added safety, refective strips are on the shirts of employees working outside the shop. “We look at uniform shirts no diferently than hard hats and safety glasses.” Although dealers can contract with third parties to provide safety training to their employees, there are no private companies ofering training tailored for
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Safety Cross-Midwest tire technician Kelly Brown follows the company’s torque procedures. The company regularly calibrates torque wrenches that are in every service truck and shop as part of its torque program. He is wearing a neon yellow shirt with refective stripes, which is a company uniform to protect employees from being hit by vehicles. Cross-Midwest requires its technicians to complete the TIA certifcation program, which teaches them how to safely service tires and recognize potential hazards. The company requires technicians to use a cage when infating tires.
tire service workers, according to Hoogenboom. “Other than a few companies that have developed programs internally, not a single organization ofers a complete OSHA-compliant training package for commercial tire service other than TIA. Tere are bits and pieces out there, but we’ve put it all together in one program.” Seyfert says being safe does lead to a beter work environment and improves the ability of a company to meet customer commitments. Te company’s promise to customers is posted on its website: “Rain or shine, snow or sweltering heat, day or night — the Cross-Midwest team is always ready to keep
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a feet of one to one thousand — or more — running 24/7.” Keeping a promise to be there wherever and whenever required starts with an efective safety program. But CrossMidwest sees beyond the business side of safety, says Seyfert. “We know we’ve given our employees the tools to understand how to do the job safely. We require the use of these programs for the safety of our employees, and believe they should all go home with exactly the same abilities they came to work with.” Hoogenboom says TIA training helps improve employee morale and retention: “When a company requires TIA training, employees see their company is taking the time and money to invest in their education and safety. We’re raising the level of professionalism. Tey are certifed technicians. Tat means a whole lot more than tire buster.” ■
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MTD November 2013
Quik-Link: 800-687-1557 ext. 22139
European notebook
An age of indecision over new tires Te issue of tire aging plays out in Europe
T
he process of tire sales in Europe is quite people in the industry and the facts are as follows. straightforward in that drivers stop in Rubber in tires does deteriorate over time due to at a tire retail center to buy a new tire UV and environmental exposure. Tis causes dry when a current one is worn, which is a practice rot leaving the structure of a tire britle which leads carried out all over the world. Tere is no doubt to inevitable sidewall damage. However, tires do that customers always visit their local tire cencontain anti-oxidizing chemicals in order to slow ter begrudgingly, as it is generally known as a down aging, but they must be used on a regular “distress purchase.” basis for this process to become efective. Poor Let’s face it, they do not fgure as an exciting storage is another important factor in this issue buy, but cars will always need replacement tires. By John Stone as exposure to sunlight, constant heat and rain But we cannot expect drivers to actually look can also infict damage. forward to upgrading their tires, and most recently in Drivers are being encouraged to question just how Europe they now have something else to possibly moan long new tires have been stored in warehouses and retail about — tire aging! centers’ racks. Manufacturers state that tires can be kept Up till now, European customers have probably not even in tire racks (in the right conditions) for up to two years thought about how old new tires could be when fted to before being sold. The general acceptance is that the their vehicles, but recent reports in the national press have product is still good to be fted even up to 10 years afer now given them food for thought on the mater. being produced. Articles have been published in leading newspapers and Te industry is also stating that vehicles that only cover low annual mileage and older vehicles tend to be most at risk from the possibility of premature tire aging, and at the moment a lot of debate is going on about the do’s and dont’s of how to combat the efects of tire aging.
A mater of geography
Consumers in Europe are learning to read — and question — tire production dates on the sidewall.
automotive magazines across Europe warning drivers to check the age of their tires. Tey also are going into detail on what happens to tires when they have been manufactured many years ago such as cracking of the sidewall and generally damaging the tire’s overall condition. Drivers also are being encouraged to check the age of their tires by looking at the panel on the sidewall which gives the production date in the form of four fgures preceded by the leters DOT. So in efect, European motorists are now increasingly questioning the actual age of new tires when they are fted.
‘Scare mongering’
I have looked at this situation in depth and it seems the tire industry is not pleased with what they openly consider to be “scare mongering.” I have discussed the situation with a good cross section of
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Having studied this growing situation across all European countries, I have found that the question of how long tires should be fted to vehicles very much depends on location and use. For example, tire aging will obviously develop more swifly in hoter climates such as Spain, Italy and Greece and much less in Scandinavia where temperatures are a lot cooler for most of the year. In my opinion the fact that the media are actively encouraging drivers to pay more atention toward the condition of their tires can only be a positive move. On the other hand, on the question of just how old tires should be, I would consider tires on display for sale should be no more than two years old and even then you have to trust that both the tire manufacturer and retailer have stored their tires correctly. Taking everything into consideration, I do not believe we have heard the last of tire aging, which possibly in the long term may well lead to even more information being added to the current EU tire label. ■ John Stone has been working within the global tire industry for the past 20 years. In 2004 he launched his own company, Sapphire Media Services, as a business media consultant with clients around the globe. Stone also writes for tire and automotive-related publications in Europe, South Afica and Asia.
MTD November 2013
Quik-Link: 800-687-1557 ext. 22140
Counter intelligence
Competence and confdence It’s all about time, talent, training and application
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o work at a retail sales counter and engage With these thoughts in mind and our objective in a meaningful way with the retail public of being counter intelligent, we need to remind requires a level of competence; although, ourselves of the importance of what we do, and from time to time, I witness and experience inthe key role that confdence and preparedness competence that causes me to shake my head. play in our successful execution of daily duties. I believe the tire retail business and automotive Te motoring public places a great deal of trust afermarket requires above-average competence. in us to repair and/or maintain their vehicles. In this article, I’d like to point out a subtle, yet Tey trust us to inspect, to quote accurately and powerful, diference between competence and reasonably priced services, and to perform them By Wayne Williams in a reasonable time. In a word, they are placing confdence. In my mind, moving from competence to confdence in us. Tey have a belief, a trust, and confdence is a process that if given consideration and a reliance on our ability to complete a job that includes, application, will put the practitioner at the top of his/ most importantly, safe driving ahead. her game. I am an emphatic believer in process. I believe in it so A confdent shop is a successful shop much that I’ve coined my own phrase, “Excellence is a Assuming your shop personnel are capable of performing process, and a process is a moving forward requiring many the requested services, then we will focus on your ability changes. We are all in a process.” to communicate with confdence. Self-confdence plays “Webster’s Dictionary” defnes confdence as a frm belief, a key role in the overall satisfaction of your customers. trust; reliance, assurance, feeling certain, a belief in one’s own Your confdence enhances your customer’s confdence ability; self-confdence. Prepare is defned as to set in place in the work done in the shop by your techs and general or in order, get ready, to make ready for a specifc purpose. service personnel. When you assure the customer that you and your team will take care of the necessary issues, they immediately feel more confdent, and confdence is critical to customer satisfaction. I’d like to ofer a few simple tips that I have found very helpful over the years. Tese are so simple and became a part of my everyday communication with customers.
✔ Pre-assure and reassure: I liked to pre-assure a phone shopper before they arrived at the store. For example, when a customer called to ask if we did alignments and the cost, I liked to say, “It’s your lucky day. One of my best alignment techs is working today. What time is convenient for you?” Tat planted a seed that the customer was going to receive quality work and that my tech didn’t work every day, so to come in that day. Of course, I could only say that if I had confdence in my alignment tech. Another way to pre-assure the customer is by saying, “Great timing. We recently had our alignment machine re-calibrated, and we’ll set it just right.” What I did is to build trust in the customer’s mind and then reassured them later when they arrived. (I always had a sense of satisfaction when a caller arrived and asked for me by name.) Another simple form of communication I learned is if you give the customer your name, you are at some level puting their mind at ease when they walk through the door. Tey are asking for you because you pre-assured them. Your team’s self-confdence plays a key role in the overall satisfaction of your customers. Their confdence leads to trust and assures your customers of their ability to take care of their service needs.
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✔ Instill confdence: Te legendary Green Bay Packers coach Vince Lombardi is quoted as saying, “Confdence is contagious. So is the lack of confdence.” Coach Lombardi
MTD November 2013
Quik-Link: 800-687-1557 ext. 22141
Counter intelligence instilled confdence into his team, into each individual. He understood that a team was a collection of individuals working together to accomplish a common goal: winning. Te same is true for us at the sales counter; winning is working together and helping customers. Another simple thing I used to do was place focus on certain services. For example, I would tell my shop guys, “We are going to do at least fve alignments today.” My confdence that we were going to focus on this valuable service, and that I could sell ’em if they could set ’em, set a tone for the day. Vince Lombardi was right. He understood human nature, and he especially understood a man’s will to achieve, his will to succeed and win. At certain times in certain stores, I could not use the same level of assurance with customers because I did not have the confdence in the shop crew.
Confdence comes from preparation
Arthur Ash, the tennis great, believed in confdence, as well. He is quoted as saying, “One important key to success is selfconfdence. An important key to self-confdence is preparation.” It is difcult to be confdent if you are unprepared, and yet preparedness makes your confdence soar. Joe Gibbs was an NFL coach winning championships with players whose careers were less than spectacular; mediocre is a term that was ofen used to describe the Redskins. How was he able to achieve success with players who had been less successful elsewhere? Confdence and preparation. Coach Gibbs won Super Bowls, three of them, and atributed much of his
A winning team works together to help customers. In your team meetings, stress the need for being prepared. Everyone needs to realize they must do their best to achieve and retain the driving public’s trust.
success to confdence and preparation. Gibbs later became a NASCAR team owner and, you guessed it, a champion there, as well. Gibbs says, “A winning efort begins with preparation.” My last quote for this article is by Dale Carnegie, a motivational expert, who once said, “Action breeds confdence and courage.” If you want to increase your success at the sales counter, and if you want to improve at serving the driving public, you must improve your confdence in yourself and your team, and
instill confdence in your customers. Tis does not happen because you want it to happen; it happens because you make it happen. “Action breeds confdence and courage.”
Confdence is earned
Preparation is the key to confdence. I know people in our industry who seem over-confdent, but really they are hiding behind a lack of confdence. Te type of confdence I’m talking about is motivated by serving others and serving them well: serving the public trust, serving the community, serving the industry. What we do is honorable, it’s important. People’s lives are dependent on how we do what we do. Tis requires genuine confdence and preparedness. I liked instilling confdence in my counter team and my shop team. Training is a huge part of being prepared. Everybody can be beter, and being beter is our job. I always wanted to feel that when a customer visited our shop(s), they received the best service in town, at least as good as anywhere else. When that wasn’t the case, we worked to make it so. Our business is becoming more complex, and as a result, you must improve to have the necessary confdence. Let’s face it; if there is a lack of confdence in your shop, then it’s just a mater of time, your shop has an early expiration date. My recommendation is that you press yourself, enroll in training classes, get involved in organizations such as the Specialty Equipment Market Association (SEMA), atend seminars, be brutally honest with yourself, and prepare, prepare and prepare.
Vince Lombardi understood that men need to be challenged and pushed, and then pushed some more. You may need to partner with someone who will hold you accountable to improving yourself professionally. Remember, prepare is defned as to set in place or in order, get ready, to make ready for a specifc purpose. Te purpose is always to perform quality work that provides safe and satisfactory driving; anything less lacks competence and is unworthy on a wide variety of levels. I’m assuming, and rightly so, that if you have read this article and are to this point, then you are an individual who values your performance and is competent in your skill sets. Te big take away is this: Never mistake competence for confdence. Once you have grappled with your competence, you’ll come face to face with your confdence, and confdence, once earned, allows you to function at the very highest levels. Competence is ability-based; it’s about you; it’s about time, talent, training and application. Confdence is not about just you, but both you and others. Tese others are the people you work with and the customers you serve; it’s about your community. Confdence is earned and felt at the deepest levels, and it happens on both sides of the counter! True confdence is unshakable and undeniable and worthy of your best eforts. ■ Wayne Williams is president of ExSell Marketing Inc., a “counter intelligence” frm based in La Habra, Calif. He can be reached at exsellmkting@gmail.com.
Quik-Link: 800-687-1557 ext. 22142
Business insight
‘Just the facts, ma’am’
CARFAX launches an automotive service site
By Wayne Croswell
to know how to care for your car. Tat’s why we created myCARFAX — to help take the hassle o you remember who made famous the out of servicing your car. Tere are many sites saying, “Just the facts, ma’am”? It was that ofer similar car care services, but no one Sgt. Joe Friday of the television show is able to provide instant service records upon “Dragnet,” played by Jack Webb. entering your car in the myCARFAX garage. CARFAX put a spin on that famous phrase With up to fve cars able when they coined the words, “Just say, show me to be stored at once in your the CARFAX.” And they have been very busy personalized garage, keeplately with something you should pay atention to. By Wayne Croswell ing track of service updates for multiple vehicles is easy! MyCARFAX.com has been launched It’s a free way to track your Have you heard about the new site launched by CAR- service history and stay on schedule FAX, called www.myCARFAX.com? It’s something you with recommended maintenance. With need to be aware of because it will impact your business. myCARFAX’s many car services, you can also get help with auto repair costs and fnding service shops near you.” Both the smartphone app and website will alert consumers of recommended services based on time and mileage intervals. In addition, it will provide consumers with a list of recommended service shops in their geographic area. Only service shops in the CARMyCARFAX.com is a website for consumers to create FAX service network will appear. Te a user account and enter their vehicles for free in the smartphone app shows me a graphical CARFAX garage. Tere is a free app for your smartphone, display of when my next oil change, as well. Consumers tire rotation and state inspection/ can view: registration is due. If I select one of the services, for • personal vehicle example “Oil Change,” I get a detailed service history, view of when my last service was per• safety and vehicle formed, the mileage at that time and when my next oil service is due. I can recalls, • recommended even look further into the previous oil service schedules, change to see where it was performed. • repair costs for In addition, I am able to search for a potential services shop in my area without ever leaving in their geographic the app. How cool is that? region, and When I tap on the “Repair Costs” • recommended service icon and select a service, for example shops in their area for their “Front Brake Pad Replacement,” it vehicles. instantaneously displays a range of pricing in my zip code area, and the Did I mention this is free breakdown of parts and labor, with for consumers? According some valuable information about brake to the myCARFAX.com pads and how they work. website: Right there, I can tap “Find a Shop” “Owning a vehicle requires and bingo, up pops a map with the service shops (in the maintenance to keep it go- CARFAX network) in my area. ing. But it’s not always easy I tap on any map pin and I have detailed information
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including phone number, directions, etc., to that shop. I just became a very educated consumer.
What are you waiting for?
If your business is not registered with CARFAX to be in their service network, I recommend you do your research. CARFAX may have already contacted you to join their network. Check to see what your competition is doing, too. Another way you can join is to contact your POS sofware provider. Some POS sofware providers have a relationship with CARFAX, whereby they are uploading your customers’ service history data. If you agree to share your service history data, CARFAX will include your service shop in their service network. Don’t worry, no customer information is shared, just vehicle servicerelated information.
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By joining the CARFAX network, you have lots to gain including new customers, access to customers’ vehicle information from CARFAX right in your POS system, reverse tag lookup, VIN decoding and more. What do you have to lose? I talk with dealers all the time about the benefts that CARFAX has to ofer them. Several dealers tell me they are not interested in participating. With the release of myCARFAX.com, can you aford to risk losing customers simply because you are not part of their service network? It is my recommendation that you take a very close look at this — now. ■ As CEO and president of WECnology LLC (www.wecnology.com), Wayne Croswell is a “complimentary technology advisor” for independent tire dealers. Croswell can be reached via his website at wcroswell@wecnology.com or (603) 249-5530.
Quik-Link: 800-687-1557 ext. 22143
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Business insight
Extending customer ‘life cycles’ Increase profts by utilizing 15 relationship-building ideas By Richard Morgan
cofee, TV, comfortable seating, a kid’s corner, etc. Te extra atention to customer-friendly details will pay of. etaining existing customers adds greater long-term 3. Use a checklist to help ensure reliable vehicle operation proftability, but many tire and auto service frms (and uncover other needs you can satisfy). Go over pay too litle atention to extending customer life the completed checklist but avoid any pressure. Let cycles. Firms invest plenty of marketing dollars to gain new the customer decide what actions to take. Performing customers, yet ignore many of the litle things that turn the additional check-up is a customer bonus and helps customers of once they come through the door. demonstrate the pride you take in your service. Everyone expects proper work and prompt service 4. Acknowledge each customer with a smile and “I’ll be with at fair prices. It takes more than that to atract and keep you shortly.” Avoid ignoring a newly arrived customer, even when they can see that you are busy with other customers. 5. Tank customers for their business with a smile, and invite them to return. Omit this fnal comment and invitation at your company’s peril. 6. Create loyalty programs and special ofers to encourage return business. Consider a discount or extra service to an existing customer as a business retention investment. People are more likely to give you their email address if you ofer incentives to do so. 7. Explain each invoice and charge fair prices. Get the customer’s approval before doing the work and be sure to point out what is included. Nobody likes unhappy surprises. 8. Check out the exclusive “Female Friendly” program by AskPaty. com for your area. A small annual fee gives you exclusive “Female Friendly” certification in your area, along with employee training It takes more than proper work and prompt service at fair prices to attract and keep and your company posting on the customers. Today, that is expected. It is what you and your team does that goes AskPaty.com website. above and beyond the competition that creates loyal customers. 9. Obtain free education from loyal customers. Here is a short list of steps a tire and your suppliers. Give your staf greater confdence when auto center should consider that help extend customer selecting and recommending products or services. retention and increase profts. Many of the steps involve 10. Give your staf the authority to immediately solve most litle or no extra expense. customer issues and monitor the actions taken. Avoid customer “hassle” over complaints or misunderstandings. 1. Nothing beats a friendly, helpful, knowledgeable staf. 11. Ofer free courtesy shutle service to local area customSmiles are free and so are many supplier-sponsored ers. Geting to and from work or home can be a big training programs. Invest in industry certifcations, concern for employees or busy moms. Look for one or they nurture customer confdence and help you retain two people who are interested in a part-time driver’s job. key employees. 12. Invest in direct mail and/or email reminders of service 2. Surprise customers with clean, neat facilities, fresh due, along with winter and summer specials. People
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forget to maintain their vehicles until the snow fies or summer heat causes a problem. A simple reminder system will ofen result in additional business from existing customers. 13. Establish a management telephone follow-up plan to help ensure customer satisfaction. Car dealer follow-up calls are mandated by manufacturers, proving their value in building customer service satisfaction. You may want to set a threshold level to avoid follow-up on very small sales. 14. Invest in a customer-friendly Internet website and keep it current. Provide education and advertise your specials. Make your site interactive so prospects can do research before calling you or coming by. Today, prospects use search engines to fnd local dealers, check product features and availability. When it is possible, many people make service appointments on-line. 15. Develop an active company presence on Facebook, Twiter, and other social networks. Today, about half of all customer communications go through social networks. Do not ignore these powerful word-of-mouth marketing tools. Make it possible for customers to “like” your company on Facebook. You might fnd that customers already “tweet” their friends about their experience with your frm on Twiter.
Relationship building becomes more analytical
More than ever, building and retaining customer relationships is the name of the game. Firms need to invest the bulk of their marketing time and budget on relationship building activities. I would venture to suggest a marketing ratio of at
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least two-thirds for customer retention and one-third for new customer development. Right now, companies like IBM have whole divisions focused on providing highly sophisticated customer analytics for other Fortune 500 frms. I clearly see the increasing use of customer analytics because I am on the board of a small West Coast frm who owns the patent for what is termed Customer Relationship Intelligence, a way to measure relationships and tie them to profts. It is easy to envision a near future when frms, large and small, will begin to compete based on their ability to atract and retain long-term customer relationships. Forward-thinking companies are fnding new ways of harnessing the massive amounts of customer data that wireless networks and digital computing power now provide. ■ Dick Morgan is a Certifed Management Consultant and a Fellow of the Institute of Management Consultants USA. He founded Morgan Marketing Solutions Inc. in early 1989 to help leaders accelerate proftable growth by enhancing a team’s ability to create and deploy right actions, right now. Morgan has more than 39 years of tire and retread industry experience, working with manufacturers, retreaders and tire dealers. He is the author of “Marketing Facets, Te Market-Focused Guide to Company Analysis,” a practical resource for those involved in determining the current health of a company and gauging its future prospects. He also speaks on marketing and management topics at industry conferences and for state and local business organizations. Contact Morgan at (972) 931-7993 or rpmorgan@morganmarketingsolutions.com.
Quik-Link: 800-687-1557 ext. 22144
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Focus on industry
Multi-brand strategy SRI gives Falken an associate in North America: Ohtsu By Bob Ulrich
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rmed with a degree in economics from Osaka University, Yasutaka Ii joined Sumitomo Rubber Industries Inc. (SRI) in Japan in 1981. Tirty-two years later, he is puting his degree to good use as senior executive officer in charge of corporate planning and international business development. He also is an SRI board member. “I supervise all overseas operations, not only sales but also factories,” says Ii (pronounced “E”). Tat includes Falken Tire Corp., SRI’s North American marketing arm. Although Dunlop is Sumitomo’s fagship brand, Falken is the only brand that Sumitomo has control over worldwide. (Under an alliance with SRI, Goodyear Tire & Rubber Co. controls the Dunlop brand in the United States, Canada and Europe.) “By country, the USA is the largest and the most important market for us,” says Ii. “Each country requires a diferent marketing message. So we listen to what (the subsidiaries) say to us, basically. At the same time, we know we have to create a good global bbrand image.” Modern Tire Dealer sat down with Ii at Sumid ttomo’s technical center in Kobe, Japan, recently, aand asked him about SSumitomo’s business makeup in general, and m tthe Falken and Ohtsu bbrands in particular. He aalso shared information aabout SRI’s next-generattion tire manufacturing ssystem, NEO-T01, which uuses a metal core process tto improve uniformity. ((For more details on the aautomated system, check oout MTD’s website.) MTD: Of the total n number of passenger tires that Sumitomo Rubber produces, what percentage do the various brands represent? Ii: Dunlop is our principal brand from a global viewpoint.
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“In most countries, we sell tires through independent dealers,” says Yasutaka Ii, senior executive offcer. “That’s common everywhere.”
More than 50% but less than 60% of our production is the Dunlop brand. Falken is about one-third. Te rest is Sumitomo and other brands. When SRI merged with Ohtsu Tire in 2003, the portion of the Falken brand was much less. Falken is growing very rapidly in the North American market... and we will continue to push the Falken brand.
MTD: What are your plans for the Falken and Ohtsu brands worldwide? Ii: Te Falken brand is currently being marketed globally, mainly in North America and Europe, but we just started selling Falken tires in India. We implemented a multi-brand strategy for passenger and light truck products in North America by using the Ohtsu brand to respond to market changes such as non-RMA share increases and diversifed brands. You have so many brands in America! We do not have any plan to expand the Ohtsu brand into any other market at this point.
MTD: Do you have enough capacity to supply Falken Tire Corp. with Falken and Ohtsu tires? Ii: Yes. We have four factories in Japan, two factories in China, a very big factory in Tailand and one factory in Indonesia. We have a new factory in Brazil that just opened, and last year, we decided to build a factory in Turkey. We want to start commercial production in Turkey by the middle of 2015. And in May, we announced the purchase of a passenger tire plant in South Africa from Apollo Tyres.
MTD November 2013
SRI is expanding its production capacities, so we don’t have to worry about supply.
MTD: Where do you build Falken and Ohtsu tires? Ii: We produce those tires in factories located in Japan, Tailand and Indonesia. MTD: Are you looking to build a plant in North America? Ii: We have no plan to build in North America at this moment.
MTD: How will you market the Sumitomo brand in the U.S.? Ii: We sell Sumitomo in the USA exclusively through TBC. USA is a huge market. Tere are so many brands. And each manufacturer, I believe, has a multi-brand strategy. I believe we can achieve some good market share for both brands, Falken and Sumitomo. MTD: Does Sumitomo Rubber operate any retail stores? If so, in what countries and what is the scale of operation? Ii: We have our own retail stores only in Japan. For passenger car tires, we have 106 outlets under the name Tire Select. For truck tires, we have 148 stores under the name Tire Land. At the moment, we don’t have a plan to open retail stores outside Japan. In Japan, we have very few competitors: Bridgestone, Yokohama and Toyo. So each tire company has its own outlets. Japan is a kind of unique country compared to other markets like the USA or Europe. But to survive as a retailer in the USA, I think you have to carry many brands, not the Falken brand alone.
MTD: Is the medium/heavy truck tire segment a signifcant part of Sumitomo’s business? Ii: Last year, the truck tire segment represented about 5% of our total sales units, but 15% of our total sales turnover, which is quite signifcant. Going forward, we are planning to expand sales mainly in Asia and Brazil. (Andrew Hoit, Falken’s vice president of marketing, says Falken Tire will continue to grow Falken brand medium truck tire sales in the U.S.) ■
Sumitomo’s Yasutaka Ii, senior executive offcer (second from right on the right side of the table) admits to MTD Publisher Greg Smith (third from left on the left side) that in order to reach the very aggressive goals set forth by SRI’s Vision 2020 management plan, the company may need to establish a factory near North America.
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Six degrees of Falken: a time line Falken Tire Corp. (FTC) is owned by Sumitomo Rubber Industries Ltd. FTC is responsible for Falken and Ohtsu sales in North America. TBC Corp. is owned by Sumitomo Corp. of America, which is a wholly owned subsidiary of Sumitomo Corp. It has exclusive distribution rights to the Sumitomo brand in North America. The largest shareholder in Sumitomo Rubber is Sumitomo Electric Industries Ltd (26.8%). Goodyear Tire & Rubber Co. controls the Dunlop brand in the United States and Canada as part of its alliance with Sumitomo Rubber. Sound confusing? Hopefully it won’t be after you look at our Sumitomo time line. 1585: Masatomo Sumitomo is born. In the 17th century, he opens a book and medicine shop based on his Founder’s Precepts, which are followed by Sumitomo Group companies today. 1909: Dunlop Rubber is established in Japan. 1919: Sumitomo Corp., one of many companies in the Sumitomo Group, is founded. 1937: Dunlop Rubber changes its name to Nihon Dunlop Rubber Ltd. 1944: Izumiohtsu, Japan, tire factory is established. 1944: Ohtsu Tire & Rubber Co. is established. 1952: Sumitomo Corp. of America is established. It is a wholly-owned subsidiary of Sumitomo Corp. 1961: Nagoya, Japan, tire factory is established. 1963: Sumitomo Group assumes management of Nihon Dunlop and changes its name to Sumitomo Rubber Industries Ltd. 1974: Shirakawa, Japan, tire factory is established. 1976: Miyazaki, Japan, tire factory is established. 1983: Falken brand is created by Ohtsu. 1985: Falken begins distribution in North America. 1986: Sumitomo Rubber acquires Dunlop Tire Corp. in the U.S. 1991: Falken Tire Corp. opens its headquarters in Rancho Cucamonga, Calif. 1995: Indonesia tire factory is established in Cikampek. 1999: SRI forms an alliance with Goodyear Tire & Rubber Co. 2003: SRI absorbs its Ohtsu Tire & Rubber Co. and Dunlop Japan subsidiaries. 2005: Thailand tire factory is established in Rayong. 2005: TBC Corp. is acquired by Sumitomo Corp. of America (SCOA), a subsidiary of Sumitomo Corp. (no relation to Sumitomo Rubber). 2007: TBC purchases Treadways Corp. from SCOA. 2009: Sumitomo Tire Technical Center is completed in Kobe, Japan. 2009: 1st Falken distribution center opens in Fontana, Calif. (D/C No. 6 will open in Chicago in 2014). 2013: Falken introduces its Ziex ZE950 line, with 95% coverage, at the SEMA Show. It will be released in 2014. 2014: SRI plans to begin production using its automated NEO-T01 manufacturing process at one of its Japanese plants. The frst tire being built will be a Dunlop run-fat tire. 2014-2015: FTC will have an OE ftment on a Chrysler vehicle, its frst in the U.S. 2020: Introduced in 2012, Vision 2020 is Sumitomo’s long-term global management program. It sets fnancial targets (1.2 trillion yen in sales) and goals (expansion in emerging markets; an “insatiable drive for innovation”) for fscal 2020.
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Focus on industry Sumitomo Rubber engineers in Kobe, Japan, WELCOME MTD! 400 people man the company’s four-year-old global Tire Technical Center
2. 3.
1. 1. Kazuhito Naito heads up wear energy testing at the Tire Technical Center. 2. Tire engineers “reduce noise level by detecting noise source” in the Anechoic Room, says Emi Sano. 3. The fat trac type test machine is designed to improve handling, braking and vehicle pull performance. 4. With the inside drum test machine, temperature, road surface and speed can be controlled. 5. New machinery aids the measuring of rolling resistance, which has been a focus since 2006. 6. The X-ray Computed Tomography (CT) Scanner is also applicable for fnite element analysis. 7. The wear energy test machine helps engineers predict irregular wear and wear life.
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5. MTD November 2013
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Focus on industry
Yokohama plants roots in U.S. soil New Mississippi factory will roll out 3,000 tires per day in its frst phase By Bob Bissler
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okohama Tire Manufacturing Mississippi LLC (YTMM), the new manufacturing subsidiary of Yokohama Tire Corp., broke ground on its new commercial truck tire plant in West Point, Miss., in September. Now, company executives are focusing on a tight schedule that will lead to the frst tire rolling out in October 2015. The company is investing $300 million in its first ground-up U.S. plant, which is good news for the Clay County area of Mississippi, where 500 jobs will be created in the frst phase of the project. Subsequent phases not yet outlined could eventually expand the facility from the initial one million square feet to fve million square feet, which would be 115 acres under roof. At that point the plant would have 2,000 employees and produce 4 million tires annually. “The U.S. commercial tire market is growing,” says Hikomitsu Noji, president of Yokohama Rubber Co. Ltd. “I think it is geting beter compared to last year and the year before. Europe is not so good and China is geting worse along with the Russian market.” Noji says that currently the company ships truck tires for the U.S. market through its partnership with Continental Tire the Americas LLC, where the companies jointly own the GTY truck tire plant in Mount Vernon, Ill. Its production capacity is 3,900 truck tires per day, according to the 2013 Modern Tire Dealer Facts Issue. “We also make truck tires at the Yokohama Rubber (TaiThe groundbreaking for the land) Co. Ltd. plant in Rayong Yokohama Tire Manufacturing Mississippi plant on Sept. 23, Province, Tailand, but it’s not 2013, was attended by Misgood enough. Demand is more.” sissippi Gov. Phil Bryant (left) Te tires produced at the new and Hikomitsu Noji, president plant will be sold in the U.S., and representative director of Canada and Mexico. Yokohama Rubber Co. Ltd. “We don’t have any plans to expand into South America at this point,” says Tadaharu Yamamoto, president of YTMM. “Our plant is being designed to have the latest technology available so we can ofer truck tires with good retreadability, durability, longevity and efciency.” “Tis is the frst plant we are building ourselves and it shows a major commitment by Yokohama for the
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Hikomitsu Noji, president of Yokohama Rubber Co. Ltd., is based in Japan. However, he also serves as CEO of all of Yokohama’s operations in North America.
North American market,” says Noji. “We will be here for a long time.” “Te reason for puting more production in the United States is not just for the U.S. market,” says Takayuki Hamaya, CFO and COO of Yokohama Tire Corp. “Yokohama’s total capacity is too small for worldwide demand and opportunity. A big percentage of our commercial business is in the U.S., and is growing. Worldwide, the U.S. market is our biggest opportunity for growth.” Hamaya says that with both consumer and commercial tires, Yokohama is concerned about the infux of Chinese tires into the U.S. market since the expiration of Tarif 421 in September of 2012. Tat infux is afecting consumer purchasing, and that is a long-term concern for the company. “Chinese brands are coming into the U.S. market and the price level is coming down. Cheap tires are coming in and the Tier Two and Tier Tree brands are reducing their prices to compete with the Chinese product. Ten the Tier Two and Tier One have to adjust also. I have no intention of adjusting our product price to the Chinese level.” Hamaya says Yokohama’s commitment to the U.S. market is not comparable to anything the company has done in the past. “We are going to produce one million TBR tires per year, 3,000 pieces a day, every day. Te frst tire comes out October 2015, and then it will take two more years to get to full capacity. Tis is the point where you will see a big diference between Yokohama in the past and in the future.” ■
MTD November 2013
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Focus on industry
How to start a tire plant
The one million-square-foot Yokohama Tire Manufacturing Mississippi LLC plant in West Point, Miss., will sit on a 570acre site, employ 500 workers and include production, warehousing and operations facilities.
According to Alan Easome, Yokohama Tire Corp.’s senior director for new plant development, the new Yokohama Tire Manufacturing Mississippi LLC (YTMM) plant will provide additional capacity the company needs to meet increased demand. “October of 2015 will be the commencement of mass production. Then there will be a scale up to 3,000 tires per day and 24/7 operation.” Easome is tasked with supporting the construction and startup of the facility. He says the frst step was the site selection process. It took several months and the company considered multiple sites throughout the country. After choosing a 570-acre site in West Point, Miss., the company chose Kajima Building and Design Group as the project’s architects and designers. “Our engineers are working closely with them in developing the requirements for the building to support our production technology.” The next step is to hire a general contractor, which will be announced sometime in Q4 2013. While all that is going on, Yokohama has teams in place working on developing the technology plan, the design of the equipment, the level of automation and where to automate. “Also concurrently we have teams in place to work on our staffng efforts because of the lead time it takes to train. There will be many new employees and in this particular area, a
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lot of the workforce has no prior tire experience. There will be a substantial training effort involved.” Easome and his team have their work cut out for them, with a 27-month timeline from groundbreaking to the frst production tire from a highly automated and advanced production facility. When it’s fully up and running and producing one million units annually, it will have approximately 500 employees. “We chose this location because the site does not require a tremendous amount of prep work, it has ample utilities, and it has a great community that we can pool resources from and support.” As a show of support, Yokohama is donating $250,000 to East Mississippi Community College (EMCC) and another $250,000 to Mississippi State University. According to Tadaharu Yamamoto, president of YTMM, the gifts will be used to develop training programs and curriculum to develop the workforce of the new plant. “These educational institutions prepare their students to be the workforce of tomorrow, as well as to become exemplary leaders,” says Yamamoto. “We’re partnering with EMCC specifcally for training and development of our production employees,” says Easome. “We also want to have a close collaboration with Mississippi State for the engineering school, the business school and to support us and have a close relationship.” ■
MTD November 2013
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TPMS
Initialize Land Cruiser sensors when adjusting pressure Reset switch initializes the warning system after repairs SUBJECT VEHICLE: 2008-13 Toyota Land Cruiser. RELEARN PROCEDURE? Yes. SPECIAL TOOLS NEEDED? Yes, a Toyota intelligent tester or Techstream. Each tire pressure monitoring system (TPMS) warning valve and transmiter on 2008-13 Toyota Land Cruisers is equipped with a tire pressure sensor and transmiter. Installed in each tire wheel, the sensor measures the tire pressure. Te measured value and transmiter ID are transmited to the tire pressure warning antenna and receiver on the body as radio waves and then sent to the tire pressure warning electronic control module (ECU) from the tire pressure warning antenna and receiver. NOTE: Te system will need to be initialized when tire pressures are adjusted; tires are rotated; tires are replaced with tires of diferent pressures; and tire pressure sensor and/or tire pressure monitor ECU are replaced. When tire pressure sensors and/or tire pressure monitor ECUs are replaced, the sensor IDs must be memorized (registered) by the tire pressure monitor ECU prior to system initialization. See reset procedures. If the transmiter ID has already been registered, the ECU compares the measured air pressure value with the standard value. When the value is less than the standard value registered in the tire pressure monitor ECU, the warning light on the instrument cluster comes on. NOTE: Transmiters have diferent bending angles at the tire pressure monitor valve sub-assembly. Tey are not interchangeable with other wheels. Figure 1: Locating TPMS reset Perform the following to test switch. the warning light: 1. Turn the ignition switch of. 2. Connect the Techstream to the DLC3. 3. Turn the ignition switch to the ON position and activate the Techstream. 4. Enter the following menus: Body Electrical/Combination Meter/Active Test. 5. Check the condition of the tire pressure warning light by operating the Techstream.
Tire pressure monitor warning light
If the ECU detects trouble, the tire pressure warning light blinks (turns on afer blinking for one minute) and the tire pressure monitor is canceled at the same time. At
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this time, the ECU stores a diagnostic trouble code (DTC) in the memory. NOTE: When replacing the tire pressure warning ECU, read the IDs stored in the old ECU using the Techstream and write them down before removal.
Reset procedures
NOTE: Te system will need to be initialized when tire pressures are adjusted, tires are rotated; tires are replaced with tires of diferent pressures; tire pressure sensor and/ or tire pressure monitor ECU are replaced. See initializing tire pressure monitor system. When a tire pressure sensor and/or tire pressure monitor ECU are replaced, the sensor ID must be memorized (registered) by the tire pressure monitor ECU prior to system initialization. See tire pressure sensor registration. NOTE: If the negative batery terminal is disconnected, initialize the following systems afer the cable is reconnected: variable gear ratio steering and moon roof. Refer to the owner’s manual or manufacturer service information. If tire pressures are adjusted, initialize the TPMS. With the ignition ON, press and hold the tire pressure warning reset switch until the tire pressure warning light blinks slowly three times and the message “TIRE PRESSURE RESET PROCEEDING� appears on the multi-information display. Wait a few minutes, then turn the ignition OFF.
Initializing tire pressure monitor system
NOTE: Perform initialization after transmitter ID registration is completed (if registration is required). NOTE: Perform initialization in the following cases: afer tire pressures are adjusted; afer replacement of the tire pressure warning ECU; afer replacement of a tire pressure sensor; specifed tire pressure changes depending on the size or type of tire; and changing the standard tire infation pressure value due to trailer towing. NOTE: Perform the tire pressure adjustment afer the vehicle has sufciently cooled down. If the vehicle is not sufciently cooled down, increase the air pressure by 3-4 psi (20-30 kPa) in addition to the specifed value. NOTE: In winter, if tire pressures decrease due to the ambient temperature, increase the air pressure by 3 psi to 4 psi (20-30 kPa) above the specifed value 20 minutes afer the initialization with the ignition switch ON.
1. Set the tire pressure of all wheels (including the spare tire) to the pressure specifed on the tire and loading information label. 2. With the vehicle stopped and the parking brake applied, turn the ignition switch ON.
MTD November 2013
3. Press and hold the tire pressure warning reset switch until the tire pressure warning light blinks three times at one-second intervals (see Figure 1). 4. Turn the ignition switch OFF. 5. Connect the Techstream to the DLC3. Turn the ignition switch ON, then turn the Techstream on. 6. Enter the following menus: chassis/tire pressure monitor/data list. NOTE: If equipped, initialization can be confrmed on the Multi-information display. It may take about two to three minutes until the values are displayed. Te values are displayed randomly (see Figure 2). 7. Confrm that the expected tire pressure data of all tires is displayed on the Techstream Data List screen. NOTE: If the initialization has not been completed successfully, DTC C2177/77 is set afer a vehicle speed of more than 5 mph (8 km/h) continues for 20 minutes or more. NOTE: Initialization can be terminated by connecting terminals 13 (TC) and 4 (CG) of the DLC3 (see Figure 3).
perform the registration procedure, a Toyota Techstream must be used.
Register transmiter ID
NOTE: When installing a new tire pressure sensor, take a note of the sevendigit number (transmiter ID) writen on the new sensor. 1. Set the tire pressure of all wheels (including the spare tire) to the pressure specifed on the tire and loading information label. 2. With the ignition OFF, connect the Techstream to the DLC3. 3. Turn ignition switch to ON. 4. Enter the following menus: chassis/ tire pressure monitor/utility/ID registration. Registration can be started while in initialization mode. However, initialization will be canceled when the registration is started. If this step is not completed within 30 seconds, registration mode will be canceled. 5. Perform the procedures displayed on the Techstream.
Demounting/mounting procedures
NOTE: If the tire pressure valve sub-assembly is going to be replaced, make a note of the seven-digit number (transmiter ID) before installation, as it cannot be seen afer sensor is installed (see Figure 4). Whenever a new sensor is installed, it will need to be registered in the tire pressure monitor ECU.
Removal
1. When replacing a wheel or tire, tire pressure sensors must be set up in one of the following ways. a. Remove the sensor from the old wheel and install it to the new wheel. b. Keep the same wheel with tire pressure sensor, and replace only the tire. c. Use a new wheel and sensor (the new sensor must be registered). 2. Remove the wheel. Remove the valve core and cap, and release the air from the tire. NOTE: Keep the removed cap, valve core, nut and washer. 3. Afer ensuring that air is sufciently released, remove the nut and washer that is used to fix the tire pressure
Confrm transmiter ID registration Tire pressure sensor registration
1. Enter the following menus: chassis/ tire pressure monitor/data list. 2. Read the “ID Tire Infation Pressure� values. 3. Confrm that the expected tire pressure data of all tires (including the spare tire) is displayed on the Techstream screen. NOTE: It may take up to two to three minutes to update the tire pressure data. If the values are not displayed afer a few minutes, perform troubleshooting according to the inspection procedure for DTCs C2121/21 to C2125/25. If the IDs have not been registered, DTC C2171/71 is set afer three minutes or more. NOTE: If equipped, initialization can also be confrmed on the Multi-information display. It may take about two to three minutes until the values are displayed (see Figure 2).
Figure 2: Initialization confrmation on the multi-information display.
Figure 3: Identifying the Data Link Connector (DLC3) terminals.
It is necessary to register the transmitter ID when installing a new sensor. To
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TPMS monitor valve sub-assembly and drop the sensor inside the tire. NOTE: Be careful not to damage the valve sub-assembly due to interference between the sensor and tire bead. 4. Afer dropping the tire pressure monitor valve sub-assembly into the tire, disengage the bead using the shoe of the tire remover (see Figure 5). 5. Remove the bead on the upper side in the usual operation. 6. Take out the sensor from the tire, and remove the bead on the lower side as in usual operation. NOTE: Check that no cracks or damage is identifed on the grommet. If so, replace the grommet together with the washer and nut. NOTE: Tire pressure sensor is powered by a lithium batery. When disposing of the sensor, remove the batery and dispose of properly. 7. Remove the inner grommet from the tire pressure monitor valve subassembly.
Installation
1. Insert the tire pressure monitor valve into the valve installation hole. Insert from the inside of the rim so that the print surface can be seen (see Figure 4). Check for the following: a. Tat there is no deformation, damage or abnormalities on the transmiter. b. Tat no foreign mater is on the inner grommet and around the rim hole. c. If installed in the reverse direction, the tire pressure valve may be damaged or fail to transmit signals at high speed. d. If installing a new tire pressure monitor valve, write
down the ID number before installation (see Figure 4). It is necessary to register an ID in the ECU afer installation. 2. Install the washer on the tire pressure monitor valve from the rim side, and tighten the nut to 35 in.-lbs. (4 N.m). Check for the following: a. Ensure no foreign mater is on the washer and nut. b. If tire pressure monitor valve was removed, check that there is no damage or cuts, and no foreign mater Figure 4: Locating the tire such as mud, dirt or sand pressure monitor valve subatached to the grommet. assembly transmitter ID. Replace the grommet with a new one if any of these defects are found. c. Check that there is no oil, water or lubricant around the rim hole, tire pressure monitor valve, washer and nut. Failing to do so may result in improper installation. 3. Afer the tire is infated, the valve nut may be loose. Retighten the nut to the speci- Figure 5: Disengaging the fed torque, and then check bead using a tire remover. for air leaks with soapy water. CAUTION: If the sensor is positioned outside this area, it generates interference with the tire bead. 4. Set the wheel disc to the mounting machine, and install the lower tire bead. 5. Making sure that the tire bead and tool do not interfere with the main body of the sensor and that the sensor is not clamped by the bead, install the upper bead. 6. When puting air into the tire, frst install the tire pressure valve straight on the stem of the tire pressure sensor. 7. Install the tire and wheel assembly. 8. When a new sensor is installed, the ID code will need to be registered. See reset procedures. 9. Afer completing the operation, remove the valve core to rapidly release the air in the tire. Ensure that the tire pressure warning light comes on. If the warning light does not come on, refer to the appropriate manufacturer service information. 10. If there is an air leakage, tighten the nut to a force of 35 in.-lbs. (4 N.m), and push the valve core two to three times to remove any dirt atached to the valve core. If air continues to leak, replace the grommet, washer and nut. ■
Information for this column comes fom Mitchell 1’s “Tire Pressure Monitoring Systems Guide” for domestic and import vehicles through 2012. 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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MTD November 2013
Products QuickJack 3,500-lb. portable jack system Ranger Products, a division of BendPak Inc., offers the QuickJack portable jack system that features a 3,500-lb. capacity. The lightweight QuickJack can go anywhere and can be easily stowed in the trunk or back seat of most cars when not in use. Repair technicians can you use it for repairs away from the shop, and it can also be used in racing applications. Simply position the lightweight jack frames under the vehicle, push the raise button on the remote hand-held pendant control and in less than 10 seconds the entire car is almost two feet off the ground ready for tire changes, chassis tuning or other maintenance. BENDPAK INC. Quik-Link: (800) 687-1557, ext. 22170 www.mtdquiklink.com/22170
Federal-Mogul Anco wiper blades Federal-Mogul Corp. has expanded its Anco line of profle-type wiper blades to include coverage for the 19 mm bayonet and side-pin connections featured on several late-model European passenger applications. The Anco brand’s Contour Narrow (N) series blades are available in nine lengths ranging from 14 to 26 inches. The blades are available for late-model Volkswagen Beetle, Jetta and Passat and several Audi models equipped with 19 mm bayonet connections, as well as BMW applications with 19 mm side-pin connections. The one-piece design features the company’s Articulated Contact technology to help prevent corrosion and freezing. FEDERAL-MOGUL CORP. Quik-Link: (800) 687-1557, ext. 22173 www.mtdquiklink.com/22173
New Greenball Centennial Terra Commander sizes Greenball Corp. says it is now accepting orders for 2014 first and second quarter deliveries for three new sizes of the Centennial Terra Commander. The new offerings include a LT235/85R16, LT245/75R16 and a LT265/75R16. Designed to deliver strong traction and control in all weather conditions, the Terra Commander provides year-round reliability, notes Greenball. GREENBALL CORP. Quik-Link: (800) 687-1557, ext. 22174 www.mtdquiklink.com/22174
Gauges2Go app simulates VDO dashboard Continental Commercial Vehicles & Aftermarket has unveiled a new smartphone app for its VDO instrument line called Gauges2Go that is available free from iTunes for use on all iOS smart devices and Google Play for Android. The new app allows enthusiasts to view VDO gauges in a virtual simulation. It includes a fully functional GPS speedometer, so any mobile device or tablet with the application is able to produce an authentic-looking dashboard. CONTINENTAL COMMERCIAL VEHICLES & AFTERMARKET Quik-Link: (800) 687-1557, ext. 22171 www.mtdquiklink.com/22171
Falken launches two Ohtsu tires Falken Tire Corp. has released two new tires for the Ohtsu tire brand, the FP8000 and ST5000. The FP8000 is a UHP summer performance tire featuring an aggressive directional tread design. Sizes range from 19 to 22 inches, W-rated. The ST5000 is an M+S all-season SUV and light truck performance tire produced in 15- to 26-inch sizes covering H, S, T and Q ratings. FALKEN TIRE CORP. Quik-Link: (800) 687-1557, ext. 22172 www.mtdquiklink.com/22172
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Mac Tools utility cart expands with technicians The Mac Tools MB199UC three-drawer Utility Cart with a split-shelf work surface has separate storage for a laptop computer and other electronic devices such as a cell phone or tablet. Access to a power outlet located in the top compartment provides power for your electronic devices such as charging your cordless batteries while keeping them secure. An optional sliding lower shelf provides easy access to the lower storage area. The reinforced lower panel gives the MB199UC the strength and durability to move over most shop surfaces. MAC TOOLS Quik-Link: (800) 687-1557, ext. 22175 www.mtdquiklink.com/22175
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Products Nexen N’blue eco now available in the U.S.
MW-200 Mobile Wheel Lift from Rotary Lift
The N’blue eco AH01 from Nexen Tire Americas Inc. is now available in the U.S. market exclusively from Tire Dealer’s Warehouse (TDW), a division of the Hercules Tire & Rubber Co. through TDW’s 14 warehouse locations and through Hercules Tire’s network of independent wholesalers. The N’blue eco is an ecofriendly, high-performance all-season tire that combines green technologies to reduce the tire’s rolling resistance resulting in good energy effciency, the manufacturer says. It is available in 36 sizes ranging from P235/55R18 to P195/65R15. TIRE DEALER’S WAREHOUSE Quik-Link: (800) 687-1557, ext. 22176 www.mtdquiklink.com/22176
Rotary Lift says shop managers can reduce the risk of employee injury while simultaneously increasing productivity with the new Rotary Lift MW-200 Mobile Wheel Lift. The air-operated MW-200 provides 200 lbs. of capacity at 100 psi, enough to lift a broad range of wheels and tires. The Rotary Lift MW-200’s airoperated design requires no batteries. It has a rise time of six seconds, fast enough to satisfy even a time-pressed quick-service technician. The wheel lift rolls on four high-quality casters for easy maneuverability and features single-lever controls for quick operation. ROTARY LIFT Quik-Link: (800) 687-1557, ext. 22179 www.mtdquiklink.com/22179
Leek-Seeker Tire & Air-Brake Leak Detection Systems Relative Manufacturing Inc. says automotive technicians can say goodbye to dunk tanks with the Leek-Seeker that changes the way leaks are found in any tire/wheel assembly and on air-brake systems on tractor/trailers. The Leek-Seeker fnds every air leak, no matter the place or how small the leak, notes Relative. The Leek-Seeker eliminates lifting tires/wheels, saves up to 75% of foor space compared to a dunk tank, is more environmentally friendly and is faster and safer for technicians to use. The Leek-Seeker will do all sizes of tires and offers fve different models to ft any need. RELATIVE MANUFACTURING INC. Quik-Link: (800) 687-1557, ext. 22177 www.mtdquiklink.com/22177
Bosch brakes line expands with Brake Shoes Robert Bosch LLC has added Bosch Brake Shoes to its line of braking products for the aftermarket. Bosch Brake Shoes feature a matching OE-style design to guarantee proper ft, and 100% asbestos-free friction formulations that ensure extended wear, consistent braking performance and long life. A rust-prevention coating enhances durability, while bonded and riveted coverage on most domestic and commercial applications matches the OE method of attachment. The 100% all-steel shoe makes for durable construction and long life, and there are no remanufactured or core charges. ROBERT BOSCH LLC Quik-Link: (800) 687-1557, ext. 22178 www.mtdquiklink.com/22178
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Modis Ultra diagnostic tool delivers speed The Modis Ultra from Snap-on Diagnostics is a multifunction tool for complete start to finish diagnostics that includes a fully integrated scan tool, lab scope, vehiclespecifc communication software and expert information resources — all in one diagnostic tool. Modis Ultra offers the unusual combination of sophistication and simple operation, suited for all technicians from rookies to seasoned diagnostic specialists. Modis Ultra combines the quick operation and broad scanner coverage of the Solus Ultra, along with a built-in graphing meter and two-channel high-speed scope. SNAP-ON DIAGNOSTICS Quik-Link: (800) 687-1557, ext. 22180 www.mtdquiklink.com/22180
Wild Spirit Sport HXT for CUV/SUV TBC Wholesale Group is expanding its Core Brand program with the launch of the Wild Spirit Sport HXT, an addition to its “EDGE” Highway CUV/ SUV/LT Powerline. The Wild Spirit Sport HXT is specifcally designed for late-model CUV, SUV and minivan ftments. The Wild Spirit Sport HXT is available in 14 sizes ranging from 17- to 20-inch diameters, T-, H- and V-rated. They have been designed to ft the most popular crossover and SUV vehicles on the road today. TBC WHOLESALE GROUP Quik-Link: (800) 687-1557, ext. 22181 www.mtdquiklink.com/22181
MTD November 2013
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To request free product information by phone, call 800-687-1557, enter the extension number listed below, and you will be immediately transferred to the company you want to talk with — it takes only seconds. To request information online, log on to www. mtdquiklink.com/ plus the corresponding Quik-Link number. You’re just a click away from receiving free information on the new products that interest you.
Advertiser 31 Incorporated ADVICS North America Inc. Aeolus Tires Aftermarket Auto Parts Alliance Inc. American Omni Trading Company American Tire Distributors American Tire Distributors ASA Automotive Systems LLC Atturo Tire Corporation Bartec USA BKT Tires USA Inc. Blackburn’s Hubcap & Wheel Solutions Continental Tire Enjoy Tyre Falken Tire Falken Tire Federal Tire Gaither Tool Company Inc. General Tire GITI Tire (USA) Ltd. Goodyear Tire & Rubber Company Greenball Corporation Hankook Tires Hercules Tires Horizon Tire Inc. Horizon Tire Inc. Hunter Engineering Company Independent Tire Dealers Group International Marketing Inc. Kenda USA Kumho Tire USA Inc. KYB America LLC Marangoni Tread North America Inc. Maxxis International—USA Nexen Tire America Inc. NitroFill Nitto Tire U.S.A. Inc. Nokian Tyres Inc. Omni-United Perfect Equipment Inc. Pirelli Tire North America Reliable Int’l Exhibition Services Co. Ltd. SD International Sentury Tire America TBC Corporation TBC Wholesale Group Tire Centers LLC Toyo Tires Toyota Motor Sales U.S.A. Inc. VDO TPMS Replacement Parts Vee Rubber Yokohama Tire Corporation
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Your turn
MTD column fortifes ‘the drive to provide amazing customer service’ Dear Editor: I recommend to all of my managers and franchisees that they subscribe to MTD as it is a necessary tool to learning and keeping track of our ever-changing business. In particular, I always enjoy reading Wayne Williams’ Counter Intelligence column as it is insightful and provides material for many of my store meetings across the country. Tis morning when I woke up, I checked my email and found a note from Lee Bassit, our store manager in Jacksonville, Fla. I sent it along to my store managers as I believe he has defned our biggest challenge as managers and leaders of others in teaching folks how to close. Selling, and particularly closing sales, does not come natural to many people. Tat is why the most successful salesmen/saleswomen in the world always follow a planned presentation designed to lead to the close. When they do it the same way over and over again, afer a while it becomes their nature and their habit, without even thinking. Ten, and only then, do people become great salesmen. Lee’s email is a great read and I wanted to share it with you:
“I share with my team that on occasion I really get amazed, ofen pissed-of, when I go shopping. Being an aware, ‘sales minded’ consumer trying to buy something, I ofen get stuck with a salesperson who acts like they are bothered by me being in the store. Or I get one who expects me to walk them through my own sale. Or, my favorite, the one who atempts to talk over me about what they believe they think is an important feature to me, but never asking me what that may be. “By sharing this, I try to make my team aware of how we make customers feel when we don’t follow through with what we know.
“I have been reading Wayne Williams’ article in the August issue of Modern Tire Dealer on ‘Te art of closing the sale — the last time, until the next time: Wrapping up the new-school ABCs of selling.’ “As old school as I am with the ‘Always Be Closing’ ABC’s, I wanted to forward it to you as there are some good points in it for all of us to have in our subconscious as ammo to use as it relates to situations that we are sometimes faced with when dealing with the newer generation of consumers. “As a salesperson, and as a manager, I have struggled to understand how what seems like basic, simple, natural and automatic refex-like actions to me can be so hard or even oblivious to others doing the same job that I do. For example, this includes greeting customers immediately, reading a customer’s body language, listening to the customer, picking up on litle things they say, or don’t say, moving a customer in the direction we need them to go, etc. “We have recently gone back to the basics and will continue to do so as I now recognize, acknowledge and accept my shortfalls as a manager. I now understand that even though I have told someone something more than once, and think or expect that someone knows something, in reality, a person does not know anything unless they can do it without thinking, consistently! Also, it’s not only what knowledge our employees have, but what facts that they are willing to recognize and accept that will keep us growing. “I have always made myself and directed my staf members to realize and respect that every customer who walks through our doors has the choice to buy anywhere that they want to. How are we going to stand out above the rest so that customer feels heard, understood and satisfed — and now welcome, wanted and important, as well?
“In the past, I ofen would require that my salespeople go to at least three to four retail stores a week, and come back to me with their feedback. Tey could go to a furniture store, a cell phone store, motorcycle/wave runner shop, high-end electronic store, CompUSA and, more importantly, other tire stores, anywhere that was a customer service and commissioned sales-driven store. “Tis is where salespeople become beter, because going out and being aware of the sales process in other environments will make a person recognize and acknowledge even the things that they do wrong. “In most cases, what they fnd are not awesome sales people and amazing customer service associates (occasionally yes, but they seem to be few and far between). What they see are the easily rejected, horrible presentations. Te lazy and ‘too busy for you’ guys. And they will hear some unbelievable pitches and comments that will make them understand the quality of service that they have come to expect. “And that will drive them to provide amazing service to our customers to build the lifelong relationships that we strive for. “As Wayne Williams said, ‘People buy products, and remember experiences.’” – Lee Bassit
www.moderntiredealer.com
Larry Suton, President RNR Custom Wheel & Tire Express Tampa, Fla.
I appreciate the team at RNR for their kind thoughts and good words. It’s nice to know that the time and efort spent writing articles about “counter intelligence,” about my experiences and frm beliefs are being read and applied. I wish the best to all who read MTD and Counter Intelligence and who serve the public diligently and with integrity. – Wayne Williams
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Your turn Tire aging issue hits home
Question of the month
Dear Editor: I have a comment on Bob Ulrich’s blog titled “Tire aging issue hits home: Should I replace 12-year-old tires?” I have a 1966 Corvete with 10-year-old tires and the car has been in the garage since it was completely restored. I also have a 1956 Bel Air with rear BFG tires that are no longer available and they are 15 years old. As long as the tires are NOT cracked and have been kept inside I believe they are fne. If this was a motor home it would be diferent. Alpio Barbara, President Redwood General Tire Redwood City, Calif.
Every month we turn to members of our National Advisory Council for guidance and information. In our members’ Your Marketplace survey for the month, we asked them, “What is your opinion on tire aging? Do you feel it is OK to sell tires more than six years old? Do you feel there should be a cutof date? If so, at what age? Do your customers ask about the age of the tires they are purchasing?” Here are some of their responses.
‘Sometimes being on the defensive is the only way to operate’ Dear Editor: Concerning Wayne Williams’ Counter Intelligence column in the May 2013 issue on “’Retailing is hard’ — Steve Jobs”: Nice points. I think that deciphering and acting on what a customer is really saying has become the hard part. With the wealth of information they have, it can get confusing fast. We have access to the same information as them, yes, but they are researching one small part of the automotive world. Our door is open for anything, anytime. Today’s savvy consumers are being trained to say as litle as possible to us, in the hopes that it will cost them less money Sometimes being on the defensive is the only way to operate. Spencer Carruthers, Owner Kenwood Tire Co. Bridgewater, Mass.
M volume should More equal beter pricing eq Dear Editor: D Concerning the July 2013 aarticle called “Modern Tire Dealer 100 for 2013: Where’s D the proft?” I think the wholesale distributor is the problem with tire margins. Tey control the pricing to their customers. I think there should be a set retail price that you have to sell them for and the more volume you do, the beter tire pricing you will receive. Then it’s about customer service. Mat McCoy, Owner M&M Tire and Auto Service Blacksburg, Va.
1. I do not feel that tires should have an aging cutof date. I have 18-year-old tires on my Jeep Wrangler and the tires are not dry-roted and look fne. It is important that the consumer inspects their tires once a month for faws. We don’t need more laws writen. 2. A few truck customers are asking for the age of their tires, but it is uncommon on the passenger side. I think 10 years is fne. If tires are stored properly I don’t think it is a real issue. 3. Te issue of tire aging has diminished. Tis is only asked about when there is a “20/20” or “Primetime” feature. I feel that six years is overkill, based on what I’ve seen in the feld and what manufacturer engineers tell us. I feel that “of by 10” is a good guideline. So, the key is when they come of, not when they are installed. 4. I feel that selling tires that have been stored properly can be sold up to 10 to 12 years. I’ve never had a customer ask about tire aging. 5. If there is going to be a cutof date, then the manufacturers need a buyback program. 6. Truck tires seem to be OK at eight years.
National Advisory Council members speak out We asked members of our National Advisory Council what was on their mind. Here are some of their comments: Negotiating: Tire dealers show their hand when they tell tire suppliers what they pay for tires. Tire dealers should work on geting the best price from suppliers, then buying the tires from the best supplier (price, terms, service and reputation). NEVER disclose what you pay for your product! Jef Cohen, Co-owner Traction Wholesale Center Bensalem, Pa.
How many dealers are planning to reduce employee hours to avoid medical insurance expense as a result of the Afordable Care Act (ACA)? What are dealers doing to ofset the taxes/fees (fxed cost) increases caused by the ACA? Are they reducing the plan design? Are they eliminating family coverage and choosing to cover just their employees? Randy Jones, President Tireman Auto Service Centers Toledo, Ohio
Join Modern Tire Dealer’s National Advisory Council
Each month, Modern Tire Dealer is guided and infuenced by a select group of readers — members of our National Advisory Council. Tese members’ opinions are the heart of the monthly Your Marketplace column, compiled by industry analysts Nick Mitchell and John Healy. 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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MTD November 2013
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