Modern Tire Dealer - November 2017 by EndeavorBusinessMedia-VehicleRepairGroup

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THE INDUSTRY’S LEADING PUBLICATION

Close the sale with power, perception and persuasion How to recognize modern M/T tire customers On the Rise: Meet our industry’s next generation of leaders

‘I’M TIRED OF MY SUPPLIER COMPETING AGAINST ME!’ Online sales remain a sore point based on survey results November 2017 | Vol. 98, No. 11 | $10 | A Bobit Publication | www.moderntiredealer.com

WHERE

NexenTireUSA.com |

MEETS

THE NEW 2018

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Features 26 ‘I’m tired of my supplier competing against me’ Online sales remain a sore point based on survey results

36 Going from ‘surviving’ to ‘much improved’ Middleroad Tire redefines ‘normal’

The Industry’s Leading Publication November 2017, Volume 98, Number 11

Departments 6 Editorial ‘We’re selling online!’ Goodyear’s strategy has not been a game changer

8 moderntiredealer.com News and navigation tools for MTD’s website

10 News/views Expect more from the DieHard brand — in stores and tires: ‘We love the concept’

17 In memoriam: Harvey Brodsky He made a lasting impression on retreading, the tire industry and me

42 On the Rise The industry’s next generation of leaders

54 Performance winter tires or studless ice and snow tires? The question you need to ask every winter tire buyer

18 On the Rise A young dealer seeks a unique online sales approach: ‘Embrace the online customer’

23 Numbers that count Relevant statistics from an industry in constant motion

24 Your marketplace

56 Vehicle inspections help turn demand for winter tires into service sales 60 Pinpointing the modern M/T tire customer Manufacturers market to the full spectrum

We believe the bulk of pricing volatility and weakness is behind us

92 Counter intelligence Points of presentation

94 European notebook Saturation point danger for tire shows in Europe

96 Business insight

69 Wage and hour regulations You probably are not in compliance

Creating standards to live by

Focus on industry/dealers 98 Get ready for the Giti and GT Radial brands

72 How is the ‘health’ of your business insurance coverage? 76 71% of employees are disengaged

100 From wheels to tires: RNR Tire Express reaches 100 stores and changes its name 106 ‘The factory is an enabler’: Nokian will focus on dealer network and all-season products 108 BFG advances its Advantage T/A ‘powerline’

So what makes you think yours are not? 109 TPMS

80 Your voice on Capitol Hill Incoming TIA President David Martin

Hyundai Elantra, Elantra Coupe and Elantra Touring

118 Your turn ‘If God didn’t use retreads, he will now!’

88 Keeping the course for TIA’s success Outgoing President Tom Formanek

113 Products 114 Ad index 116 Classified Modern Tire Dealer is a proud member of: TRIB

TIRE RETREAD & REPAIR INFORMATION BUREAU

Member An Industry Association

MTD November 2017

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Editorial

‘We’re selling online!’

Goodyear’s strategy has not been a game changer

his year, in order to meet consumers’ my mind other tire manufacturers will follow changing needs, we will offer another suit within the next 24 months.” way to purchase Goodyear consumer It hasn’t happened en masse. I do believe more tires, and this is... online.” With those words, tire manufacturers will sell tires online, but no Andy Traicoff, vice president of consumer sales one knows when. I commend the tire companies and customer development for Goodyear Tire that have chosen not to sell online because they & Rubber Co., set in motion what was thought don’t want to compete with their dealers (and, to be a paradigm shift in the tire industry. let’s not be naive, potential dealers). Goodyear had been testing the concept of sellI also don’t blame the companies that have ing tires directly to the consumer via its website, By Bob Ulrich chosen a different path based on sound reasoning. goodyear.com, for three years, but made it official Remember when Michelin decided to take at the Goodyear Dealer Conference in Grapevine, Texas, the concept a step further by testing its OnSite concierge on Jan. 26, 2015. More than two years later, would it be service in Raleigh-Durham, N.C.? That would have made fair to call that a fateful day? Michelin a tire dealer, not just an online seller. The dealers I think you know the answer to that. Goodyear and balked. Michelin eventually decided to scrap the idea. Michelin North America Inc., the only two tire manufacturFollowing Goodyear’s announcement in 2015, one of its ers selling tires on their respective websites, have not set dealers was very vocal about the strategy. Charley Gowland, the world on fire with online sales. And none of you went owner of Chabill’s Tire Service LLC in Morgan City, La., out of business because of it. sent a letter to MTD outlining his concerns. Don’t get me wrong, it “Why in the world would I matters. If you didn’t literally want to sign on to a program get with their programs, you that spells eventual doom to a may have had business taken large part of the profitability of away from you. Or not. If you my business?” wrote Gowland, joined their programs and who has spent 50 years of his became a preferred installer, life in the industry. “In the end, you may have gained busianother distribution channel ness. Or not. will be established, in a static At the time, some dealmarketplace, with the loser being ers considered it a direct the independent tire dealer.” attack on their gross sales Like me, Gowland believed and profitability, just one other manufacturers would more thing the tire manufacturers were taking from them. follow suit. Only Michelin did. Ironically, Michelin is I can’t blame them. Gowland’s largest supplier. By selling their tires online, tire companies are competing He has softened his viewpoint a bit since then. He has against you. They can’t say otherwise. However, they also yet to join either program, but believes significant growth are trying to work with you to lessen the sting. In addi- in online sales is inevitable. tion, their reasoning behind selling online — the needs “Fifteen percent of tire transactions are going to happen of smartphone-loving millennials require it — is valid. online,” he says. “You certainly want to be a part of it, but If your website doesn’t offer your customers the ability to you don’t want to be a part of that and lose money. purchase and pay for tires online, at the very least you should “If they want to be successful and make the 15% happen be looking into it. Consumer buying habits are changing — and it will happen because the consumer wants it to because of technology. Don’t ignore that, embrace that. happen — manufacturers will have to make the programs Some of the record 2,140 people attending the Goodyear more helpful and profitable for the dealer.” Dealer Conference were not happy; I know, because I was Gowland has paid close attention to the programs in the there. I asked them. Some thought it was a great idea. last two years, and has witnessed a change in attitude for Some took a wait-and-see aproach, grudgingly jumping the better. When the time is right and he feels he is getting on the Goodyear bandwagon knowing they could jump a fair return on his investment, he may just sign up. Until off at any time. then, his 14-store chain is doing just fine on its own. ■ Was Goodyear’s announcement a game changer? It hasn’t been so far. If you have any questions or comments, please email me at Here’s my quote at the time: “There is no question in bob.ulrich@bobit.com.

I do believe more tire manufacturers will sell tires online.

MTD November 2017

moderntiredealer.com DIGITAL RESOURCES FOR THE INDEPENDENT TIRE DEALER

Readers seek out both good and sad news The most read news item on our website, www.moderntiredealer.com, over the last month was our announcement of the winner of our 25th Tire Dealer of the Year award. Brothers Mark and Scott Rhodes, co-owners of Plaza Tire Service Inc. in Cape Girardeau, Mo., received the award for their outstanding success with their 62-store chain. Other top news items covered Nokian Tyres plc breaking ground on its $360 million tire plant in Dayton, Tenn., and the death of retread industry champion Harvey Brodsky. Here are our top 10.

MTD bestowed upon Mark and Scott Rhodes our 2017 Tire Dealer of the Year award. The brothers have added 25 stores since purchasing Plaza Tire Service, and now have 62 stores in four states and an estimated $80 million in annual sales.

1. Meet the 2017 winners of the MTD Tire Dealer of the Year award: Mark Rhodes and Scott Rhodes 2. Nokian breaks ground of first tire production site in North America 3. Harvey Brodsky, the voice of retreading, dies at 81 4. The next generation moves up at Community Wholesale Tire 5. Hankook will raise prices again 6. Prices on Triangle tires will go up Oct. 1 7. Scott Damon will take over Bridgestone commercial tire operations 8. TBC continues expansion across the South 9. Michelin is selling more TCi locations 10. Continental picks Chris Charity to lead PLT replacement sales

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

MTD November 2017

News/views

Expect more from the DieHard brand — in stores and tires ‘We love the concept’ In June 2016, when Sears Holding Corp. announced it was attaching its iconic DieHard brand name to tires, the president of Sears Auto Centers told Modern Tire Dealer, “We will learn a lot over the next 18 months about the acceptance of the brand.” Brian Kaner provided a good time line, but he didn’t keep his job as leader of Sears Auto Centers long enough to see the result. Eight months after the tire launch, the company attached the DieHard name to a pilot retail concept. The first DieHard Auto Center Driven by Sears opened in February in a defunct Sears Auto location in San Antonio. Six months later, Sears opened two more DieHard Auto Centers in the Detroit area. The existing Sears Auto mall stores in Troy, Mich., and Roseville, Mich., have three times the number of bays as the store in Texas. Storage spaces were renovated into modern-looking showrooms so the Michigan stores never lost a day of operations. They closed one night as Sears Auto Centers and opened the next morning with the DieHard name. New entrances directed consumers into the new showrooms. The old showrooms are used for storage. So how is business? “Based on what you’re seeing, with one (store) in San Antonio and two in Michigan, obviously we love the concept, and we continue to learn and get smarter every time we do it. It’s very exciting for us, and you will see more,” says Jon Otterberg, president of Sears Auto Centers since April. He says the DieHard stores combine the products and services consumers know and trust with an “all new DieHard Auto Center experience, which is a very relaxing and incredible place.” The stores feature interactive, digital displays as well as a tire wall where consumers can examine products. The stores sell DieHard tires, as well as others, including Michelin, Goodyear and Continental brands. On the service side, all Sears stores utilize Hunter Engineering Co.’s Quick Check system, though Sears calls it the Performance One Stop. It provides a report on the vehicle’s alignment, battery performance and tire tread depth, plus a diagnostic check. “It’s all about changing the member experience,” Otterberg says, “to interact with them and educate them in a welcoming, friendly environment.” The look of the stores is important on multiple

The DieHard Auto Center stores feature a clean, modern look, and offer consumers free WiFi access.

levels. Otterberg says the clean, wide-open space is attractive to younger customers, which is helping the company balance against its traditionally older clientele. “I don’t want to say it looks like a Starbucks, but it’s pretty nice.” Tom Park, president of the Kenmore, Craftsman and DieHard Division, says the updated look was needed to match the brand perception. “DieHard is known as one of the most respected and best brands in the country. If we’re going to put the DieHard name on the front of the store, everything from the service you get to the products you buy to the experience that the customer has must be in line with the brand identity.” The tires Otterberg and Park say it didn’t take long for the DieHard Silver Touring A/S tire to take a prominent spot in Sears’ sales. “Since we launched the tire in August of 2016 it has become the No. 2 unit selling brand in our lineup,” Otterberg says. “And it became that in the first six months,” says Park. “It rose to that level and enabled the future development of the full line of tires. It’s been really well received by our customers.” Philip Philip, general manager of the DieHard brand, says the company is working to expand the DieHard lineup into the performance, ultra-high performance and light truck categories. So could commercial tires come next? “Our tire expansion focus for DieHard is performance and light truck up to 1 ton,” says Park. “Our future focus beyond performance and light truck could include OTR and TBR tires.” Officials declined to map out a time line for future releases of any new products. — Joy Kopcha

MTD November 2017

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News/views

bites

Pirelli sets OE record Pirelli & Cie SpA set a record with 110 new original equipment fittings in August 2017. The fitments include winter tires, all-season tires and Pirelli performance tires.

Apex donates tools Apex Tool Group LLC has donated $220,000 in tools, as well as the use of a 350,000-squarefoot warehouse in Garland, Texas, to help stage and sort donations for hurricane victims. The company is donating tools from its GearWrench, Crescent, Wiss and Lufkin brands to help rebuild communities impacted by Hurricanes Harvey and Irma. ATEQ offers TPMS video ATEQ TPMS Tools LC has released a new training video on how to perform a stationary tire pressure monitoring system (TPMS) relearn procedure on a 2011 Ford Fusion. Camso buys distributor Camso Inc. has acquired four Stanley Industrial Tires outlets in Texas and Louisiana from Tires-PJ’S, LLC based in Gladewater, Texas. Cooper sponsors NHL team Cooper Tire & Rubber Co. is sponsoring the Ottawa Senators during the 2017-18 National Hockey League (NHL) season. Hankook joins USTMA Tire production has begun at Hankook Tire America Corp.’s first manufacturing site in the U.S., giving the company the green light to join the U.S. Tire Manufacturers Association (USTMA). Wheel weight for cold temps Wegmann automotive USA Inc. has added an adhesive wheel weight designed for cold temperatures to its Perfect Equipment product line.

Carl Icahn now operates 1,900 automotive service outlets in U.S. Icahn Enterprises L.P., the parent company of Icahn Automotive Group LLC, has acquired American Driveline Systems, a franchisor of automotive service shops with about 680 locations in the U.S. and Canada. American Driveline Systems is the franchisor of AAMCO Transmissions and Total Car Care and Cottman Transmission and Total Car Care. “The acquisition of American Driveline Systems is the next step in building out our national automotive service network,” says Carl Icahn, chairman of Icahn Enterprises. “I believe that the automotive aftermarket service industry is undergoing secular change driven by increased vehicle complexity, advances in technology, as well as the growth of automotive fleets, including ride-sharing and car-sharing networks. “These changes will continue to offer, in my opinion, extremely attractive and unique investment opportunities. With our presence throughout the automotive aftermarket value chain, Icahn Enterprises is positioned to capitalize on these trends.” The Icahn Automotive Group portfolio is made up of Pep Boys – Manny, Moe & Jack; Auto Plus; Just Brakes; Precision Tune Auto Care; and American Driveline Systems (ADS), the franchisor of AAMCO and Cottman. With the ADS acquisition, Icahn Automotive operates approximately 1,900 owned and franchised service locations in 49 states plus Puerto Rico, the District of Columbia, and several international locations. Icahn Automotive made several purchases in the final weeks of the summer 2017. In August, the company acquired a 27-year-old independent tire dealer with 15 stores and a tire wholesaling business in Arizona. Pep Boys – Manny, Moe & Jack, Icahn Automotive Group LLC, the owner of a wholly-owned subsidiary of Pep Boys – Manny, Moe & Jack, surpassed Icahn Automotive Group LLC, 1,000 stores in June 2017, and by September had more than more 1,900 company-owned agreed to acquire Paragon and franchised service locations. Enterprises Inc., which does business as Advanced Auto Service & Tire Centers. Advanced Auto Service employs more than 120 people and has operated in Arizona since 1989. The majority of its locations are in the Phoenix area. All 15 locations will be rebranded as Pep Boys Service & Tire Centers. In September, Pep Boys – Manny, Moe & Jack bought a six-year-old shop in the San Francisco, Calif., area, which it says is located in “a target market” for more growth. Newpark Auto Service has seven bays and will be rebranded as a Pep Boys Service & Tire Center. In addition, Icahn Automotive Group’s multi-million-dollar expansion in the Detroit, Mich., market includes new stores, extensive remodeling of several existing stores and the doubling of its parts inventory in the market. The investment follows a couple of recent deals that include Detroit-area stores. Icahn acquired Precision Auto Care Inc., including Precision Tune stores in Detroit and Royal Oak. The company also acquired Phil Cavill’s Tire & Auto Service Center in Clawson, Mich. The 10-bay store is being converted into a Pep Boys store. — Joy Kopcha

MTD November 2017

News/views

bites

Nexen secures fitments The N’blue HD Plus from Nexen Tire Co. Ltd. will be original equipment for several European automobile brands, including Volkswagen, SEAT and Škoda. Loaner tool program expands Bartec USA has expanded its tire pressure monitoring system (TPMS) loaner tool program to help those affected by Hurricane Irma in Florida. The company offered a similar program to technicians affected by Hurricane Harvey in Texas and Louisiana. One20 adds tire program One20 Inc. has introduced a direct warehouse-to-consumer commercial tire buying program for its nearly 400,000 professional truck driver members. One20 says the program will leverage more than 200 wholesale warehouses and 75,000 tire service centers. Omni United supports BCRF Omni United (S) Pte. Ltd. and its Radar tires brand ambassador Jodi Ewart Shadoff raised funds for the Breast Cancer Research Foundation (BCRF) through the “Birdies for BCRF” program in October. Buffett invests in Pilot Flying J Warren Buffett’s Berkshire Hathaway Inc. is investing in Pilot Travel Centers LLC, and by 2023 will own the majority of shares of the company that operates 750 locations in the U.S. and Canada. Pilot Travel Centers does business as Pilot Flying J. Virginia Tire supports IJM Virginia Tire & Auto LLC will donate a portion of proceeds from oil changes through June 2018 at all of its 13 locations to the International Justice Mission (IJM). SMP earns MERA approval Standard Motor Products Inc. (SMP) has been accepted into the Manufactured Again Certification (MERA) program. The program helps customers identify remanufactured products with likenew quality and warranty coverage while promoting environmentally friendly standards.

Manufacturers name new leaders for North American tire sales The president of Goodyear Tire & Rubber Co.’s North America consumer business is moving to the company’s Asia Pacific business unit, and as a result Scott Rogers is taking over the top job. Rogers has served as chief marketing officer for the North America consumer business since joining Goodyear in 2009. He replaces Ryan Patterson, who has been named to succeed Chris Delaney as president of the company’s Asia

Scott Rogers will lead consumer tires sales at Goodyear.

Bridgestone has hired Shannon Quinn to lead OE tire sales.

Chris Charity is the new vice president of sales at Continental.

Pacific business. Delaney has been named president of the Europe, Middle East and Africa (EMEA) unit. Bridgestone Americas Inc. has hired Shannon Quinn as president, original equipment (OE) tire sales, U.S. and Canada, Bridgestone Americas Tire Operations. She succeeds Mike Martini, who has retired. Chris Charity is the new vice president of sales following a reorganization of Continental Tire the Americas LLC’s U.S. passenger and light truck replacement tire sales team. He joined Continental in 2002.

Colony Tire expands in Virginia Colony Tire Corp. has purchased three tire outlets in the Lynchburg, Va., market. Glenn A. Trent Inc., dba Glenn A. Trent Tire & Wrecker Co., will now do business as Colony Tire. Lynchburg Tire Corp. and its two locations also will merge with Colony Tire. Partnering with Colony Tire will allow Glenn Trent to expand its product line and provide more extensive services to its existing customer base, effectively tapping into a vast inventory and expediting the response time to fleet needs.“We are extremely honored that Glenn Trent has given us the privilege to service his customer base in Lynchburg,” says CEO Charlie Creighton. “When you grow a company like this from the ground up, working day in and day out for 74 years, it becomes more than just a business — it’s your life legacy.” Lynchburg Tire has two locations, one in Lynchburg and one in Madison Heights. “In the tire business, it is always best to develop your relationships with customers, vendors and manufacturers, and Lynchburg Tire’s relationships have made them successful,” says President Scott Creighton. “Joining forces with Colony Tire allows them to expand their product line and provide for their customers better than ever before.” Colony Tire, based in Edenton, N.C., is one of the largest tire dealers in the South, with 30 locations across Virginia, North Carolina and South Carolina. The company also runs four wholesale distribution centers.

MTD November 2017

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News/views

dates

January 22-25 Heavy Duty Aftermarket Week, The Mirage Hotel & Conference Center, Las Vegas, Nev. www.hdaw.org February 15-16 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 21-24 Tire Industry Association’s Off-theRoad Tire Conference, Sawgrass Marriott Golf Resort & Spa, Ponte Vedra Beach, Fla. (800) 876-8372 www.tireindustry.org March 5-8 American Trucking Associations Annual Meeting, Georgia World Congress Center, Atlanta, Ga. (703) 838-1700 www.trucking.org March 14-16 PAACE Automechanika, Centro Citibanamex, Mexico City, Mexico www.paace-automechanika-mexico.us.messefrankfurt.com March 22-24 Mid-America Trucking Show, The Kentucky Exposition Center, Louisville, Ky. (502) 899-3892 www.truckingshow.com April 13-15 Virginia Automotive Association Convention and Trade Expo, The Homestead, Hot Springs, Va. (804) 739-1400 www.vaauto.org April 18-20 Clemson University Global Tire Industry Conference, Sonesta Resort, Hilton Head Island, S.C. (864) 656-2200 www.clemsontireconference.com

Black’s Tire has raised more than $1 million for children’s charity Black’s Tire Service Inc., based in Whiteville, N.C., and owned by Ricky Benton, has raised $1,031,143.50 for the Boys and Girls Homes of North Carolina Inc. since its inaugural charity golf tournament in 2002. The first tournament raised $6,000. At the 2017 event in September, the company raised $167,690.50. The total includes a 50-cent donation from a little girl who saw a sign in a Black’s Tire store advertising the tournament. She asked her mother to take her back home so she could get her money Ricky Benton checks out a billboard at Black’s Tire Family “because the Day that names the 10 employees who will take a pie in children needed the face to raise money to fund a college scholarship. help.” In addition, the tournament raised another $5,000 to fund a college scholarship for a graduating senior of the Thomas Academy, a charter school located on the Boys and Girls Homes campus. The day after the tournament, Black’s Tire hosted its annual BTS Family Day at the Boys and Girls Homes campus. Ten Black’s Tire employees participated in a “pie face” contest and raised $1,680 for the scholarship. — Joy Kopcha

Blackburn buys warehouse Blackburn OEM Wheel Solutions Inc. has purchased a 96,000-squarefoot facility in Streetsboro, Ohio. The company is using 35,000 to 40,000 square feet of the warehouse for its business and leasing the rest of the space to tenants. The new facility enables the original equipment wheel, wheel cover and center cap distributor to process incoming product at a quicker pace with increased efficiencies, according to Jimmy Blackburn, co-owner.

Vehicle data access amendment is added to autonomous vehicle bill The Auto Care Association is praising the Senate Commerce Committee for including a vehicle data access and control amendment in the “American Vision for Safer Transportation through Advancement of Revolutionary Technologies” (AV START) Act (S 1885). “The inclusion of the data access and control amendment is an important step in the industry’s efforts to obtain direct access to data generated by embedded vehicle telematics systems,” says Bill Hanvey, president and CEO of the Auto Care Association. The bill moves to the Senate floor where the association has vowed to work for its approval. ■

MTD November 2017

In memoriam: Harvey Brodsky

Harvey Brodsky made a lasting impression on retreading, the tire industry and me By Bob Ulrich

first met Harvey Brodsky at the 1985 National Tire Dealers & Retreaders Association convention in Atlanta. The introduction went like this. “Hi, Mr. Brodsky. I’m Bob Ulrich, assistant editor of Modern Tire Dealer.” “It’s Harvey, Bob. You are no less important than anyone else in this industry. You should call people by their first names.” And with that, I not only started a 32-year friendship, but also learned a lesson I still follow to this day. I write this upon hearing of the death of Harvey, who died of complications from lung cancer on Sept. 17 at the age of 81. He was an industry icon, truly the “Voice of Retreading” for 29 years as managing director of the Tire Retread & Repair Information Bureau, or TRIB. He was a tireless conference speaker,

problems suffered in an accident, he passed the managing director’s position to Jeffrey Parks in December 2016. He was diagnosed with lung cancer last March. “We lose... a champion of life itself, and of the world of business, a scholar on all topics regarding the tire, retread and rubber industries,” says Parks. “We lose a man who did business with good spirit, on a handshake, without remorse or greed. “We lose a reliable ally, who asked for nothing in return but our friendship and commitment to the same causes that would help us all thrive. “We lose a man who always looked for the best in people and himself. His energy, enthusiasm and integrity were unquestionable, and his accumulated

Brodsky, left, with Ralph “Buddy” Snow of Oliver Rubber Co., center, and George Winchester of Teknor Apex in 1981.

exhibitor, promoter of retreading and refuter of negative publicity of the retreading industry. He received the American Retreaders Association Industry Leadership Award in 1991, only nine years into his role with TRIB. At his induction into the International Tire & Rubber Association Hall of Fame in 2000, he once again shared a life lesson: “If you find something you love to do, you never have to work a day in your life.” I’m sure that for most of his adult life, Harvey did not work. He formed the Retread Tire Association in 2010. Because of severe back

www.moderntiredealer.com

knowledge of the industry was gleaned from the thousands of friends and associates he made during his life and career.” I was lucky to be one of those friends. I say the same about his wife, Rona Halpern, the love of his life. She has been battling breast cancer for 15 years. Rona set up a gofundme account to help pay for Harvey’s medical bills. That account can be reached at: www.gofundme.com/ harvey-brodskys-medical-fund. I’ll leave you with this. In 1991, I met new Goodyear Tire & Rubber Co. Chairman and CEO Stan Gault at the company’s headquarters in Akron, Ohio, as we sat down to lunch. “Hi, Stan. I’m Bob Ulrich, senior editor

of Modern Tire Dealer magazine.” He followed up with the normal pleasantries. After lunch and after Gault had left, one of the Goodyear executives at the table said, “I can’t believe you called him Stan! Even I have only referred to him as Mr. Gault!” At the time, I thought of Harvey and smiled. I am doing the same thing as I write this, although the moment is bittersweet. ■

A young dealer seeks a unique online sales approach ‘Embrace the online customer’ By Joy Kopcha

nline tire sales is a scary topic for plenty of independent tire dealers. But it’s not so frightening to Josh Wright, the 32-year-old owner and operator of The Tire Shop in Lewistown, Mont. It might be the answer to his small business problem. Wright owns a small retail store that offers automotive repairs and operates two service trucks for on-site farm and equipment service. Lewistown is a city of about 6,000 people in the middle of Montana. The closest larger city is Great Falls, Mont., 100 miles away. The location means Wright’s inventory management is especially important, and he’s struggled with what to have on hand. He wonders if aligning himself with an online tire retailer, like Simple Tire LLC, and ordering all of his tires through them, might be a solution. He could market and even brand himself as a Simple Tire dealer or installer. Consumers can order tires from home and ship them to The Tire Shop, but Wright’s also considering installing computers in his store for consumers to use to place their tire orders.

Tire sales at Countryside Tire and Auto Service have improved since the Tennessee dealership posted its “out-thedoor” tire prices online for customers.

He likes Simple Tire because he says the site is easy to navigate. “I am able to help even my oldest customers through the process on the phone.” Wright says, “So far this idea has netted me a few sales, and people like the idea of brand access. It works well in my rural community where it can be a 50-mile trek to town. “The idea behind this was to compete with larger tire shops

on brand offering and inventory management. With less inventory, more cash flow has been freed up and margins are up.” Modern Tire Dealer introduced Wright to Josh Chalofsky, chief operWright doesn’t see online ating officer at Simple Josh tire sales as competition. He’s Tire. Both men are part looking for an inventory partner. of MTD’s group of young leaders in the industry, On the Rise. Chalofsky says Wright’s idea isn’t a far-fetched one. “We are interested in this topic,” Chalofsky says. “We are in the process of building it out and releasing it, but it’s not ready yet.” Once it’s live, Chalofsky says Simple Tire will see if there are other dealers like Wright interested in it, too. MTD asked other young leaders in On the Rise to weigh in as well. Jeff Cheek is the owner and manager of Countryside Tire and Auto Service Inc. in Oak Ridge, Tenn. He says his business has been an installer for TireBuyer.com from American Tire Distributors Inc. (ATD), “but that has never really been a big mover.” They’ve also done some installations through Goodyear Tire & Rubber Co.’s online sales platform. But the biggest game changer has been Countryside Tire’s own initiative. The business published its tire prices online a few months ago. Consumers can choose tires, get “an outthe-door price” and schedule an appointment for installation, Cheek says. “That has been a big success for us, and it keeps our business name in front of the customers — not ATD’s or Goodyear’s.” Ray Turner Jr. is director of retail operations in Indiana for Belle Tire Distributors Inc. He thinks dealers who worry excessively about online tire sales are at risk for being left behind. “Remember tire pressure monitoring systems (TPMS) and all those dealers who said, ‘this will never last’? They have been playing catch up for the last seven years,” Turner says. “Those dealers who refuse to embrace the online concept will be doing the same — playing catch up! “One could argue the online customer is much like the Costco or Sam’s Club customer — are they really a target customer for small dealers? Probably not. But even if the online customer is not a target market customer, they still represent an opportunity for increased cash flow and profits. The labor work and future service work cannot be purchased online. “I truly believe the retailers who embrace the online customer and partner with the online retailers are the ones who will succeed in this changing industry.” ■

MTD November 2017

17.55 million Number of vehicles sold in the U.S. automotive market in 2016. Source: www.oneclickretail.com

3,000 56%

Percent of Americans who check the health of their tires with just a visual inspection. Source: Hankook Tire America Corp.’s latest Hankook Tire Gauge Index.

Number of newly introduced parts, tools and components featured in the New Products Showcase at this year’s SEMA Show.

Source: Specialty Equipment Market Association (SEMA)

50%

14 million Number of vehicles on U.S. roads over the age of 25. Source: www.oneclickretail.com

Percent of the total CUV tire population made up of the top 10 CUV tire sizes. Source: Rick Brennan, vice president of marketing, Falken Tire Corp.

$1 trillion

Buying power of milennials (those born between 1982 and 2000). Source: MTD 2017 Facts Issue

$2.4

61% billion Percent independent tire dealers hold of all consumer tire retail sales.

Amazon.com’s 2016 automotive aftermarket sales.

Source: MTD 2017 Facts Issue

Source: www.oneclickretail.com

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4/6

Number of driver championships (4) the combined Corvette Racing. teams have won in the last six (6) years. This is the second time Jan Magnussen and Antonio Garcia (2013, 2017) have bested their No. 4 Corvette Racing teammates Oliver Gavin and Tommy Milner (2012, 2016) in championship seasons.

NumbersThatCount

Relevant statistics from an industry in constant motion.

Source: Michelin North America Inc.

Your marketplace

We believe the bulk of pricing volatility and weakness is behind us

ccording to the results of our survey, environment improved slightly in September demand for passenger and light truck marking an improvement in three of the past replacement tires declined in Septemfour months, which is a departure from volatile ber. The latest performance brings a halt to the trends in the first half of the year. slow progress made in sell-out trends over the previous four months, which followed a very Monthly survey challenging start to the year. Generally speaking, A number of independent tire dealers were the demand slowdown continues to puzzle the surveyed concerning current business trends. industry contacts we speak with, as the weak Except for tire prices and costs, the results of figures run counter to what is typically found By Nick Mitchell the September 2017 survey are compared with with this level of gross domestic product growth. those of September 2016. See the whole report As noted previously, our contacts have offered little on www.moderntiredealer.com. explanation as to why the soft trends across the passenger and light truck replacement tire market persisted into the Dealers are cautiously optimistic about 4Q17 third quarter of 2017. While the sluggish sell-out trends in According to the survey results, 100% of passenger and the first half of 2017 created a difficult operating environ- light truck tire dealers believe that business will stay about ment in the short-run, the inability of any of our contacts level over the next six months, and none are worried that to point to any structural factors that might be pressuring trends will improve or worsen. The outlook for commercial demand trends, in addition to the healthier, albeit far from truck tire demand was a little more optimistic, as 50% of robust, results over the past few months, leads us to believe the dealers we spoke with see the business staying about that the odds are still high that the weak trends will prove the same in the coming months while the other 50% of to be transitory. In the meantime, we expect the industry the participants see business trends improving. to remain fairly disciplined with production and pricing.

Replacement tire sales volume trends deteriorate

How dealers view near-term business Dealers

MAY

JUN

JUL AUG(R)

Passenger tire Will improve Will worsen Will stay level

33% 0% 67%

67% 0% 33%

33% 0% 67%

0% 0% 100%

25% 0% 75%

Truck tire Will improve Will worsen Will stay level

100% 0% 0%

67% 0% 33%

40% 0% 60%

0% 0% 100%

50% 0% 50%

R-Revised

SEP(P) SEP(16)

Consumer demand for passenger and light truck replacement tires declined in September compared to the prior year’s period. From a volume standpoint, the dealers reported they sold 1% fewer tires last month relative to the previous year’s period. The latest performance brings a halt to the slow progress made in sell-out trends over the previous four months. Dealers reported medium truck replacement tire volumes were up 1% versus September 2016 following flattish trends in August. Retread units were down 2.3% versus the prior year’s period, which marks a decline in every month of 2017 so far, except for flattish trends in June.

P-Preliminary

Repair sales increased year-over-year in September Regarding the inventory positions of our respondents, the healthier sell-out trends coupled with disciplined production schedules enacted by manufacturers in the second quarter of 2017 leads us to believe that progress is finally being made destocking the inventory buildup that occurred during the first few months of the year. That said, many still felt they were over-inventoried at the end of the period. In regards to pricing, we are growing optimistic that the bulk of the pricing volatility and weakness is behind us as we continue to hear from contacts in the industry that upstream promotional activity has stabilized following better sell-out trends in June, July and August. In fact, our recent channel work suggests that the broader pricing

Automotive repair sales trends increased in September, which is in-line with the increases in service revenues in seven of the previous 10 months (February was flat, May was down 2%, June was down 1%). Specifically, the dealers indicated that service sales, which accounted for a net 26% of total revenues, were up slightly on a year-over-year basis in September. This compares to increases of 5% or more from October through January, flat trends in February, and a 1.8% and 2% gain in March and April, respectively. ■ Nick Mitchell is managing director, research analyst, for Northcoast Research Holdings LLC based in Cleveland, Ohio. Mitchell covers a variety of subsectors of the automotive industry.

MTD November 2017

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‘I’m tired of my supplier competing against me’ Online sales remain a sore point based on survey results By Bob Ulrich

ast year, U.S. consumers purchased 14.1 million passenger and light truck tires online. The total represents 6% of all aftermarket tire sales at the retail level. That number is expected to increase in the next few years, primarily because millennial buying patterns are changing the face of retailing. And an increasing number of online-only tire retailers are making it possible. But there is no reliable research that supports buying tires online will significantly replace tire purchases at retail stores. No matter where they buy their tires, consumers have to visit brick-and-mortar stores to get them installed, which changes the dynamic of online selling for tires. There is, however, recent data on what both consumers and independent tire dealers have to say about online tire sales. Modern Tire Dealer commissioned both surveys. The results confirm two things: Online selling by tire manufacturers remains an unresolved issue with tire dealers; and consumers seem to be willing to try online tire buying. Whether you decide to join an online tire retailer’s installer network or rely on your own website, here’s what you need to know about online sales and selling online.

Defining moments ”As consumer demographics continue to shift and 80 million millennials come into the marketplace, we have to meet their shopping experience.” Rich Kramer, chairman, CEO and president, 2015 Goodyear Annual Report “Buying tires online” refers to the complete payment of the tires on the website itself. If the consumer has to pay for the tires in person, then the customer did not buy them online; they were just ordered online. Reinalt-Thomas Corp., which does business as Discount Tire, and Tire Rack Inc. are the pioneers of online tire selling. Discount Tire began selling online through its Discount Tire Direct subsidiary in May 1994, only 13 months after, as the World Wide Web Foundation describes it, the underlying proprietary code needed to open the web to the world was made available royalty-free forever to anyone who wanted to take advantage of it. Tire Rack followed suit in 1998. Both companies evolved their innovative internet business models from their respective mail-order businesses. Tire Rack began selling specialty tires by mail as early as 1982; Discount Tire’s mail-order business survived the failure of its Tires Plus Club in California. A number of start-up companies jumped on the bandwagon from 1998 to 2012, with some of them cannibalizing sales from

Online tire pricing ”Product pricing, which tends to be 20% to 40% lower online for automotive parts, has been the primary driving factor behind e-retailing growth in this segment. However, the dominant presence of low-cost, ‘bricks’ mass merchants such as Wal-Mart and Costco, have kept tire pricing fiercely competitive through traditional channels, particularly in the U.S., leaving little incentive for consumers to purchase their tires online.” Kumar Saha, research manager, Frost & Sullivan, 2014 Online tire pricing varies greatly depending on the website. The Fitment Group collected these advertised prices for two specific tire lines. Advertised web pricing, week of 5-14-2017 1. Goodyear Wrangler ATS, size 265/70R17 bigotires.com $158.76 goodyear.com $179.00 merchantstire.com $176.37 ntb.com $175.55 pepboys.com $199.99 tires.com $147.00 tiresetc.com $138.00 walmart.com $149.00 2. Hankook Dynapro ATM RF10, size LT235/75R15 LRE dunntire.com $109.08 mavistire.com $119.99 onlinetires.com $96.86 sears.com $133.20 simpletire.com $108.99 tirerack.com $99.25 townfairtire.com $117.00 walmart.com $95.00

Not all the websites were set up for selling online. For example, dunntire.com offers up a quote and then requires the customer to schedule an appointment – with no money changing hands online. Source: The Fitment Group

Sources for all charts not credited: Modern Tire Dealer Online Sales Research Studies, June 1, 2017. Numbers may not equal 100% because they are rounded.

MTD November 2017

each other. But the decision by Goodyear Tire & Rubber Co. to sell tires directly from its goodyear.com website, announced at the 2015 Goodyear Dealer Conference, was met with both excitement (according to Goodyear) and skepticism (dealer outcry). Goodyear was the first tire manufacturer to directly sell its tires online. Michelin North America Inc., with its bfgoodrichtires.com and michelinman.com websites, also sells tires online. In a nutshell, Goodyear believes offering consumers, especially millennials, the opportunity to buy and pay for tires when they visit goodyear.com will be a win-win for both Goodyear and the dealer. Goodyear gets the sale, and the dealers get 1) a delivery fee from Goodyear, 2) all installation charges, and 3) the opportunity to generate additional service revenue from consumers they would not see normally. Here’s what the dealers think.

Tire dealers: The majority doesn’t participate When independent tire dealers were asked if their companies participated in any tire manufacturer consumer online tire sales program, the breakdown was as follows:

39%

Dealer survey ”I feel all tire manufacturers will all sell tires online as it is the wave of the future. We are signed up for the installer programs. The vast majority of these customers so far have been bottom feeders. The majority don’t want an alignment or any other services. The tire manufacturers tell us it attracts new customers. What a joke!” Jerry Reygaert, owner, Rey’s Auto & Tire Inc., Utica, Mich.

The relationship between independent tire dealers and their tire suppliers is a complicated one. Many wholesale suppliers allow dealers to buy their tires from them online. American Tire Distributors Inc. (ATD) went a step further when it created TireBuyer.com for consumers, and partnered with its tire dealer customers. To date, TireBuyer.com’s installer network consists of 9,000 dealers who not only keep their installation costs, but also the selling price of the tire, minus ATD’s normal wholesale price. With tire manufacturers it is different. Both Goodyear and Michelin drew the ire of some of their dealers by keeping the tire cost minus an average stipend of close to $12 a tire, depending on the tire. Nearly 60% of the respondents to MTD’s Online Sales Research Study of Independent Tire Dealers said they did not participate in any tire manufacturer online sales programs. Then they were asked, “If your main tire brand supplier started an online sales program, would you participate?” more than half of the respondents said “Yes.” Of the 44% who said “No,” the most common reason for not participating was “I’m tired of my supplier competing against me.” Here is a breakdown of all the reasons why they would not participate (the dealers were asked to list one or two main reasons for not participating): 67%: I’m tired of my supplier competing against me. 52%: The program devalues my role as an expert in the business. 48%: We like to interface with the consumer directly. 40%: Don’t want to lose the profit in a tire sale itself. 30%: Don’t believe the customer will make the right choice. 29%: Too much hassle for too little additional business. 18%: Don’t want the hassle of credits for the tire sales. 17%: Other.

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59%

Yes

Don't know

Tire dealers: Satisfaction level According to Modern Tire Dealer’s Online Sales Research Study of Independent Tire Dealers, 42% of the respondents participating in the goodyear.com consumer online sales program said they were “Moderately satisfied” with it. Not satisfied

Slightly satisfied

Moderately satisfied

Very satisfied

Extremely satisfied 0

The study also asked if dealers would be interested in online sales programs created by any of their tire suppliers. Half of the dealers said they would not participate, with a similar breakdown in the reasons given for not supporting an online sales program created by their main supplier. Fifty percent said they were tired of their suppliers competing against them.

Consumer survey ”The consumer experience can be bumpy. After they complete the online transaction, the odds of them getting their credit card

Online tire sales out for any other purchase is very low.” Randy Jones, president, Tireman Auto Service Centers, Toledo, Ohio According to MTD’s Online Sales Research Study of Consumers, price and previous online buying experience were key factors in choosing to buy via the internet.

• Over half of those buying online made the transaction through computer/laptop, with over a third using a smartphone device instead. Mobile usage, often referred to as m-commerce, is growing in all online retail sales. • 80% of consumers buying online were either very satisfied or extremely satisfied with how the installer treated them. • Virtually all of the consumers surveyed who bought tires online would do it again. • 50% of those people who bought online had previously bought tires online. It should be noted the survey respondents buying online appeared to have had more experience with long-standing online sellers like Tire Rack than they did with the relatively new tire manufacturers’ websites, which at the time were still being fine-tuned. This may have skewed the results to some extent. Among those surveyed who had bought tires, but not online, the local independent retailer was the “go-to” source for more than a third of them, with nearly a third choosing a large independent tire retailer. And the respondents said the retailers were chosen primarily on the basis of either trust or price offered. Among those who had bought tires in last 12 months but had not purchased them online, one-third of them said they had considered it before deciding not to.

The major players ”I think every manufacturer is considering going directly to the consumer.” John Aben, senior vice president of OE and consumer sales, Giti Tire (USA) Ltd. Tire Rack and Discount Tire Direct remain the dominant business-to-consumer (B2C) web retailers to this day, accounting for the majority of the distribution channel’s 6% market share. Combined, they account for close to 10 million of the 14.1 million in domestic replacement unit sales. Tire Rack’s business model also encompasses B2B tire sales. The following 12 websites are currently leading retail sellers of tires online. There are other players in the market, but these are the websites that rank high in a variety of keyword searches when using leading search engines. 1. TireRack.com 3. TireBuyer.com 5. 1010Tires.com 7. RightTurn.com 9. Amazon.com 11. Michelinman.com

2. Discounttiredirect.com 4. Simpletire.com 6. Onlinetires.com 8. Tires-easy.com 10. Goodyear.com 12. BFGoodrichtires.com

Here is a synopsis of each of the major players. Because the Michelinman.com and BFGoodrichtires.com websites are run differently, they are listed separately.

1. Tire Rack (www.tirerack.com) Headquarters: South Bend, Ind. Began selling tires online: 1998 No. of warehouses: 7 (more than 2.2 million square feet) Offers 24 tire brands: Avon, BFGoodrich, Bridgestone, Continental, Dick Cepek, Dunlop, Falken, Firestone, Fuzion, General, Goodyear, Hankook, Hoosier, Kumho, Laufenn, Michelin, Nexen, Pirelli, Power King, Riken, Sumitomo, Toyo, Vredestein and Yokohama. Write-up: Although family-controlled, the Leonard Green & Partners investment firm has had a minority ownership in the company since 2005. It has more than 8,000 “independent recommended installers.” In 2014, tirerack.com received more than 50 million visitors.

2. Discount Tire Direct (www.discounttiredirect.com) Headquarters: Phoenix, Ariz. Began selling tires online: 1994 No. of warehouses: 4, with free shipping in the 48 contiguous states Offers 54 brands: includes the three anchor brands (Goodyear, Bridgestone and Michelin) Write-up: Discount Tire has a full-time metrics analyst and uses web analytics tools to gauge the effectiveness of all of its internet-based marketing efforts. It has a long list of “qualified installers” in all 50 states that extends beyond its 1,000 stores.

3. TireBuyer (www.tirebuyer.com) Headquarters: Huntersville, N.C. Began selling tires online: 2009 No. of warehouses: more than 140 warehouses in the U.S. and Canada, with more than 800 delivery trucks

Consumers: Online tire purchasers Of the respondents who purchased tires between May 1, 2016, and May 16, 2017:

21%

79%

Purchased tires at a dealer Purchased tires online

MTD November 2017

Online tire sales Offers 20 tire brands: Michelin, Bridgestone, BFGoodrich, Firestone, Uniroyal, Fuzion, Goodyear, Continental, Dunlop, General, Kelly, Kumho, Mickey Thompson, Nexen, Nitto, Dick Cepek, Cooper, Falken, Ironman, Carlisle Write-up: The program was introduced in 2007 by American Tire Distributors. Tire buyers also have the option of buying online on the www.TirePros.com website; although its “buy now” button is an affiliate link to the TireBuyer.com platform, it doesn’t include a “ship-to-home” option.

4. SimpleTire (simpletire.com)

Headquarters: Trevose, Pa., with satellite offices in Utah and India Began selling tires online: 2010 No. of warehouses: 0 Offers 269 brands: includes the three anchor brands (Goodyear, Bridgestone and Michelin) Write-up: “Instead of buying and reselling tires like other retailers, SimpleTire uses data and technology to aggregate tire inventory... from more than 500 suppliers across the country,” says the company. “These suppliers compete with each other on price, selection and delivery.” It has a vast network of thousands of distributors and installers. When asked, “On a scale of 1 to 5, where 1 is ‘Not at all difficult’ and 5 is ‘Extremely 5. 1010Tirescom difficult,’ how difficult was it to find tires and make the purchase?” 60% said not (www.1010tires.com) at all difficult. Headquarters: British Columbia, Canada Not difficult Began selling tires online: July 2000 No. of retail stores in Canada: 4 Slightly difficult Offers 30 tire brands: includes the three anchor brands Write-up: The company ships by Moderately difficult United Parcel Service (UPS) Standard Ground service to the U.S.; for Canadian orders, it also uses Very difficult Purolator, Canpar and Nationex. It prefers to ship an order to the billing address of the credit card Extremely difficult or to one of its “certified installers.”

Consumers: Ease of buying online

6. Onlinetires.com (www.onlinetires.com)

Headquarters: La Mirada, Calif.

Consumers: Online tire pricing When asked, “Why did you choose to buy tires online?” respondents said price was a big factor.

Online had the best price Previously purchased tires online Knew what tire I wanted Easier to buy online Did not want to visit store No trustworthy retailers Bought same brand I had Other 0

MTD November 2017

Online tire sales Began selling tires online: 1998 No. of warehouses: 5 Offers 56 tire brands: includes the three anchor brands Write-up: Onlinetires.com is part of American Tire Depot, a 91-store retail chain. Ara Tchaghlassian is company president. It markets itself as “Home of the lowest-priced tires on the web.” Another website, superbuytires.com, is also part of company.

Consumers: Devices of choice When asked, “On what device did you use to purchase your tires online?” many survey respondents preferred buying with their iPhones, Android phones or Windows phones. <1%

7. RightTurn (www.rightturn.com) Headquarters: Cleveland, Ohio Began selling tires online: 2012 No. of warehouses: 42 in the U.S. and Canada Offers 15 OE tire brands: BFGoodrich, Bridgestone, Continental, Dunlop, Firestone, General, Goodyear, Hankook, Kumho, Michelin, Nexen, Pirelli, Toyo, Uniroyal and Yokohama. Write-up: The program was created when Dealer Tire LLC tested the pilot program in the Dallas/Fort Worth area; the program soon expanded to northeast Ohio. In June 2016, the company rolled out the program nationwide. The network has more than 8,000 “factory-certified installers” (i.e., franchise automobile and light truck dealerships).

36% 52%

11%

8. Tireseasy LLC (www.tires-easy.com) Headquarters: Benicia, Calif. Began selling tires online: 2008 No. of warehouses: 0 Offers 112 tire brands: showcases 12 on its home page: Cooper, Falken, Goodyear, Hankook, Toyo, Achilles, Michelin, Bridgestone, Nokian, Milestar, Nankang and Vredestein Write-up: The website is owned by Delticom North America Inc. “We offer fast delivery, affordable shipping rates, free road hazard combined with a 45-day money back guarantee.” It partners with Kevin Byrd and Willie B, hosts of the “Two Guys Garage” cable television show.

In-store computer

Tablet

Computer/laptop

Smartphone

Offers 51 brands: includes the three anchor brands Write-up: Amazon.com Inc. does not buy direct from manufacturers, based on MTD research. 9. Amazon (www.amazon.com) In its 2015 fiscal year ended Dec. 31, 2015, Amazon.com Inc. Headquarters: Seattle, Wash. sold $63.7 billion worth of goods online in North America. No. of warehouses: 0 That included tires and automotive parts. ComScore Inc. says Amazon is “evolving its digital strategy to new platforms and is even getting into brick-and-mortar retail.” Amazon has tire installation available at what it calls “pros” Four-fifths of consumers buying tires online were either very satisfied or extremely locations. “We only invite providers satisfied with how the installer treated them. who have a strong track record of service quality,” says Amazon. com. “We screen through a comExtremely satisfied bination of media searches, online interviews, and reference checks.” Very satisfied There remain gaps in its network.

Consumers: Satisfaction with the installer

10. Goodyear (www.goodyear.com) Moderately satisfied Slightly satisfied Not at all satisfied 0

Headquarters: Akron, Ohio Began selling tires online: 2012 (testing program); launched nationwide in 2015 Write-up: At the 2015 Goodyear Dealer Conference, the company shared these stats about selling tires online: nearly 60% of the consumers who purchased online were new customers to the installing location;

MTD November 2017

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Online tire sales Consumers: Repeat customers When asked, “Would you buy tires online again?” the online purchasers overwhelming responded “Yes.”

12. BFGoodrich (www.bfgoodrichtires.com) Headquarters: Greenville, S.C. Began selling BFGoodrich tires online: September 2016, in the greater Charlotte area Write-up: As of Oct. 12, BFGoodrich tires could be bought online in 38 states and the District of Columbia. Sears, Roebuck and Co. sells tires online through its Sears Auto Centers (www.searsauto.com) and Sears Auto Digital Tire Journey app. Bridgestone Americas Inc. (www.bridgestonetires.com) does not sell online directly; with its TireConnect software tool, it works with the websites of its dealers, allowing them to get full credit for online tire sales, plus remain in control of their inventory, pricing and labor/installation costs. Similarly, TreadHunter Inc. (www.treadhunter.com) only connects neighborhood retail tire stores directly to internet consumers.

96%

Future growth

Yes

”As online tire retail penetration grows to around 24% in Europe and 12% in North America by 2023, offline tire retail will transform to offer a seamless tire purchase experience in tandem with e-retailers.” Frost & Sullivan, March 2017

and 38% of these new consumers returned to the installing location for more service. Close to 5,000 “authorized local installers” have signed up to be part of the program. Nick Mitchell, head of research for Northcoast Research Holdings LLC in Cleveland, Ohio, estimated Goodyear sold 200,000 online through www.goodyear.com in 2016.

The tire industry is nothing like the apparel or consumer electronics industries. As they relate to online retailing, tire sales are reliant on an additional service that, realistically, only can be performed with the help of skilled hands, bricks and mortar. However, as millennials and members of the iGeneration 11. Michelin (www.michelinman.com) replace the Baby Boomers, the way all products, including tires, Headquarters: Greenville, S.C. are bought and sold online will continue to evolve. Began selling Michelin tires online: 2017 Goodyear updated its online tire sales program in July when Write-up: Michelin will only ship to dealers who are part of its it launched Dealer Match program, a direct result of dealer “Service Provider” network. The service providers, which are also feedback, says the company. The program allows dealers to part of Michelin’s Authorized Dealer Network, have to meet a match Goodyear.com pricing in-store while maintaining series of standards in order to participate in the online program. typical margins associated with an in-store sale. Tire sales on Amazon.com could grow dramatically, but only if it can 1) add warehousing or find partners Consumers: Non-online purchasers willing to share their tire inventories; Of the respondents who purchased tires between May 1, 2016, and May 16, and 2) expand its limited network 2017, 21% did not buy online. When asked, “Why did you buy your tires from this of installers. ComScore has said retailer?” respondents answered as follows: Amazon is adding brick and mortar to its business model, but all things being equal that will increase costs, I trust this retailer and as a result, tire pricing. Amazon.com’s size has already Best price for tires led to “Amazon laws” in 34 states, which require sales tax be charged by large online sellers. Had the brand I wanted In addition, both houses of Congress have introduced bills that would Previous experience require online sellers with annual gross sales of more than $1 million Recommendation to collect sales tax in 45 states (five states have no state sales tax). That Emergency purchase may help bridge the competitive gap 0 10 20 30 40 50 60 70 80 in pricing between online retailers and tire dealerships. ■

MTD November 2017

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feature

Going from ‘surviving’ to ‘much improved’ Middleroad Tire redefines ‘normal’ By Richard Morgan Situation: Milt Average, owner of Middleroad Tire, grew increasingly disappointed in the performance of his company. His five-store dealership had produced profits in the 2% to 4% range five years in row. But the most recent year showed a profit below 2%, creating real concern. Milt was determined to go from “fair” to much better results. Sales had been sluggish with the exception of one year where sales increased by 9% due to some incentives and greater sales effort by store managers and service writers. In that year, the stores saw more new and returning customers. The following year, margins improved but sales fell back and fixed expenses increased. Milt sensed that he needed to get everything going in a positive direction, so he made plans to redefine “normal” for his company.

Potential impact study Milt and an outside advisor drew up a five-step improvement plan. The first step was to quickly determine the positive impact on operating profits if the firm’s best historical performance

levels could all occur in the same period. The abbreviated impact study is shown in the chart. Highlighting the firm’s best year for sales growth, contribution margin and fixed expenses, Milt noted that the three keys all fell in different years. The best fixed expense control occurred in 2014, whereas the best sales growth happened in 2015. The greatest margin on materials, labor and other variable costs fell in 2016. Milt and his advisor then projected the positive impact on Middleroad’s net income if the company could attain its past top performance in each factor all during the same year. The reasonable impact of a renewed focus on best performance could propel Middleroad’s net income from $295,000 in 2017 to $1,574,000 in 2018, almost a five-fold improvement! The high potential for improvement focused the firm’s management on those critical goals. Breaking down the impact analysis to the individual account categories of variable costs and fixed expenses helped point to specific areas where the team might negotiate significant improvements.

Middleroad Tire Impact Study (000’s) ITEM

2013

2014

2015

2016

2017 Projected

2018 Forecast

Sales

15,000

15,450

16,840

17,515

17,865

19,665

10,200

10,660

11,114

11,210

11,970

12,585

68%

69%

66%

64%

67%

64%

Margin $

4,800

4,790

5,726

6,305

5,895

7,080

Margin %

32%

31%

0.34

36%

33%

36%

Fixed expense $

4,500

4,326

5,220

5,780

5,600

5,506

Fixed %

30%

28%

31%

33%

31%

28%

Income $

300

464

506

525

295

1,574

Income %

1.65%

Growth % Variable costs

4.85X Note: Abbreviated study of a fictitious company.

MTD November 2017

Business improvement plan Benchmarks Milt and his store managers now had an ambitious, but workable, goal for the new year. Their focus on best performance indicators took the team even deeper into comparing their current and planned operations to a series of industry statistics and benchmarks. Using previously published tire dealer indicators and ratios often used by accountants and banks, the team compared Middleroad Tire to other firms of similar size in both the tire industry and in other general categories. Some of the key performance indicators they used were:

• sales per employee and profit per employee; • gross margin as a percentage of sales; • fixed expense as a percentage of sales; • operating profit percentage; • total personnel cost as a percentage of sales; • inventory turns per year; • accounts receivable — days sales outstanding; • percent return on total assets utilized, and percent return on owner’s equity; • debt-to-equity ratios; • current ratio and acid test ratio; and • cash flow and current liquidity.

Reviewing the company against benchmarks for 2017 (projected) and 2018 (forecasted) gave Milt and his team confidence and a keen desire to move ahead with additional steps to create a much more profitable firm going forward.

only by the hour have no incentive to increase productivity, rather they often get rewarded by overtime pay if they work slower. Such plans work against the firm’s desire to improve productivity and profit. Alternate plans that reward more effective time utilization work better. Problems are sure to arise when different incentives act at cross purposes between functions. Employee policies and procedures need to be written and well-communicated. Employees appreciate knowing what is expected and where they stand. Manuals and frequent refreshers help avoid misunderstandings and possible litigation. Employee hiring, on-boarding and continuing individual development are vital management activities. Leading tire dealers invest significant effort in developing people and offering advancement opportunities. Happy employees help create happy customers! Other alignment areas include:

• streamlined marketing and customer-related policies and procedures with outstanding customer experiences as a primary goal, both in-store and on-line; • financial policies, reporting and organization, authorities, and control guidelines, where first line employees are empowered to make most customer-related decisions; • administrative and HR policies, payment policies, hiring, terminations, discipline or changes in compensation; and • contingency plans, risk management, insurance and catastrophic loss to the business.

Immediate action plans Balance of functions and resources Milt and his team then reviewed Middleroad Tire’s balance and capacity to handle the projected growth in volume and profits. They recognized that their primary functions and resources needed to be well-balanced to generate winning customer experiences while earning a better and sustainable profit level. When functions and resources are unbalanced, profits and customer service often suffer. (See my MTD Business insight article “Balance is a primary business strategy”on www.moderntiredealer. com from November 2006.) Customers expect friendly, personalized service and a pleasant buying experience. That requires product availability, adequately trained staff, short waits and clean, comfortable stores. Customers go where they feel invited and only return if they feel appreciated!

Alignment checks Profit improvement can be derailed by certain policies, procedures and programs. Milt and his team carefully reviewed their policies and programs to ensure that they were in alignment with the company’s new goals, strategies and plans. One area that can be particularly troublesome is employee compensation plans. For instance, service employees being paid

Several issues arose during the review sessions that cried out for action by the team. Milt’s advisor recommended that the team establish specific action plans for each issue so that work could begin immediately. The work was organized using the following steps: • individual, specific action plan for each identified issue; • each action plan assigned to a single individual as “coordinator”’ even when several team members would be involved in completing the plan; • establish an initial target date for completion of each action plan. The team, owner and coordinator to agree on timing, considering other daily job requirements and the potential for positive results; • coordinators to determine the specific steps to complete plans, along with an estimate of the costs and benefits of each plan; • Milt to review all action plans, prioritize to gain greatest overall effect, and commit the time and money required to complete the plans; and • tthe management team to hold frequent review sessions to keep all action plans on track, and to celebrate completion of the vital action plans as they occur.

MTD November 2017

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compared to the firestone transforce ™ ht

* Based on internal tread wear test results compared to Firestone Transforce™

HT in tire size LT245/70R17 119/116R. On road results may vary.

SIZE

SIDEWALL

LOAD R ANGE

LOAD INDE X / SPEED R ATING

LT215/85R16

BSW

115/112 R

LT225/75R16

BSW

115/112 R

LT235/85R16

BSW

120/116 R

LT245/75R16

BSW

120/116 S

LT265/75R16

BSW

123/120 R

LT245/75R17

BSW

121/118 S

LT245/70R17

BSW

119/116 R

LT265/70R17

BSW

121/118 R

195/70R15C

BSW

104/102 R

225/75R16C

BSW

121/120 R

235/65R16C

BSW

121/119 R

R & S Speed Rating LT - Metric Sizes

R Speed Rating C - Tire Sizes

Sizes

Width

215 to 265

195 to 235

70 to 85

65 to 75

Rim Diameter

16" & 17"

15" & 16"

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Business improvement plan For example, the Texas Consilium is a non-profit organization dedicated to the growth and improvement of small and mid-size companies within the state. Their business experts develop detailed impact studies, diagnostic analyses, and implementation assistance for relatively low fees when compared to the striking improvements clients gain. Check out www.txconsilium.org for more information. Other states may have similar developmental programs. ■

Outside resources There are numerous outside resources available to owners like Milt. The predecessor to the Tire Industry Association (TIA) published a profitability guide back in 1989 which can be helpful in developing specific benchmarks and sample analyses. A firm’s CPA can assist in developing a more detailed, individual version of a financial impact study. Statistics for other similar retail and commercial dealers may be available from the U.S. Commerce Department. Other local and state organizations also may offer assistance.

Dick Morgan has more than 43 years of tire and retread industry experience, working with manufacturers, retreaders and tire dealers. He is one of the judges for MTD’s Tire Dealer of the Year award each year. Morgan is a Certified 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 profitable growth by enhancing a team’s ability to create and deploy right actions, right now. Morgan is the author of “Marketing Facets, The 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.

MTD November 2017

HARNESS THE BUYING POWER OF ITDG

Buy like you have 1,500 stores regardless of how many locations you have! Pricing is just one of many benefits you will receive from ITDG. Our members also enjoy other competitive advantages that make joining the ITDG team a very smart business decision.

ITDG’S COMMITMENT TO YOUR BUSINESS IS STRONGER THAN EVER • The ITDG team, led by Dave Marks, Chris Barry, and Cheryl Bluman, is working hard to continue to add value for all of our products and programs for ITDG members • To best serve the needs of members, we will have offices on both the East and West Coast for maximum efficiency in responding to your requests • We know that this industry is all about people and relationships and we strive to make ours better with our members, suppliers and vendors every day ITDG’S 3 PILLARS OF SUPPORT • Our preferred vendor programs: tires, wheels, equipment, parts, fluids, and much, much more • Our Captive Insurance Program*: better protection with consistent profits to you, the member • Our Internal Financing Program*: a differentiator for our members *Ask about parameters and availability of these programs in your area OUR PROGRAMS PUT YOU IN THE DRIVER’S SEAT, AND YOUR GROWTH INTO OVERDRIVE It’s your business! • You still make the decisions • From single to multiple locations—ITDG has you covered • You maintain your identity • We work for you, the dealer Consistent, competitive, and compelling pricing with direct access to manufacturer programs

Dave Marks dmarks@itdgusa.com 925-658-0323

Chris Barry cbarry@itdgusa.com 310-251-9528

On the Rise

The industry’s next generation of leaders

Jeremy Burt JOB TITLE: OPERATIONS & MARKETING MANAGER COMPANY: BURT BROTHERS TIRE AND SERVICE INC. LOCATION: SALT LAKE CITY, UTAH AGE: 35

How do you spend your work day? I currently work out of our corporate office and warehouse. I spend most of the day overseeing the warehouse operation, buying tires and working directly with manufacturers. I also do the marketing and advertising for all Burt Brothers locations.

What’s the biggest issue facing the industry today? There are two things. The first is technology at the point of sale. Let’s face it, we are not handing transactions on tablets yet and the online tire store is our first impression nowadays. Secondly, tire prices are becoming a commodity. Online consumers are just choosing a low price and don’t know what they are getting or what they are losing, and it’s cutting margins for brick and mortar stores. Our service and that of many other dealers is worth extra money, but how do you portray that to a price point customer who has never done business with you before?

Who & Where Fausto Astudillo ... 48 Jeremy Burt ... 42 Steve Campanella ... 46 Jason Cieslinski - 52 Braden Crockett ... 44 Cody Diemer ... 52 Thomas Dobson ... 48 Nick Dougherty ... 42 Wade Eaves ... 50

Erin Edminister ... 48 Alex Feliz ... 44 Loudan Hammersmith . 52 Vahe Michaelian ... 46 Josh Penfold ... 50 Roger Strider ... 46 Kelly Sumner ... 50 Dale Vaughn ... 44

oung leaders are pumping vitality into the tire industry, and for the second consecutive year Modern Tire Dealer is recognizing the trailblazers who are spending their days, and nights, creating new ways to do business. They represent multiple-generation tire dealer families and manufacturers who are inventing technologies that are bringing about a revolution to the entire transportation sector. Here are snapshots of young leaders On the Rise in our industry. Look for larger profiles of each person on our website. — Joy Kopcha

What’s the worst cliché made about your generation? That we are the same. I don’t want to be held down to everyone’s viewpoint.

What do you expect to be doing 20 years from now? Working as a partner in the Burt Brothers corporation with my brothers, and being part of executive management working on ways to be more profitable and expand our footprint to service great customers.

Nick Dougherty JOB TITLE: REGIONAL RETAIL BUSINESS CONSULTANT COMPANY: TIRE PROS/AMERICAN TIRE DISTRIBUTORS INC. LOCATION: TEMECULA, CALIF. AGE: 32

What was your first job in the industry? I was a lot porter at a car dealership and boy was it eye opening. I did not know what I was getting myself into. I did everything from cleaning toilets to directing traffic and washing cars. What’s the biggest challenge you’ve faced in your career?

MTD November 2017

Having to step back in certain situations when I could help is tough from a consulting standpoint. How do you spend your work day? I am a Tire Pros regional business consultant and I help independent business owners grow their businesses. My responsibilities include a wide assortment of tasks ranging from sales training to increasing bottom line profits. What do you expect to be doing 20 years from now? Golfing on courses I never would have been able to in my prime. Maybe traveling on a flying car that needs tires.

Tell us something about yourself others might not know. I almost went professional in bowling, but I made more money as an amateur because I didn’t have to travel as much.

Dale Vaughn JOB TITLE: QUALITY ENGINEER COMPANY: COOPER TIRE & RUBBER CO. LOCATION: TEXARKANA, ARK. AGE: 30

What was your first job in the industry? I started with Cooper in December 2010 as an industrial engineer. I recently moved to the role of quality engineer and work closely with the departments I serviced in my previous role with a more hands-on approach to problem solving and process improvement. What’s your biggest accomplishment in the industry? My biggest accomplishment has been taking part in the growth of Cooper’s Serbia operations. I was fortunate to be able to travel to Serbia and take part in evaluating new equipment, racks, aisles and all aspects of ergonomics that had to be taken into consideration for the layout of the plant.

What’s the biggest issue facing the industry today? I think the biggest issue is that competition continues to grow, globally and in North America, so we have to improve every day in order to gain a competitive advantage and provide a superior product.

What’s the one thing you wish someone would have told you before you entered the industry? Keep an open mind as there is always a better way to do something, even if it has been done the same way for 100 years. How do you encourage others to enter the industry? I’m part of Cooper’s Dream Team, which is a group of younger employees that works with youth in the community to encourage them to pursue roles in manufacturing.

Alex Feliz JOB TITLE: SERVICE ADVISOR COMPANY: REDWOOD GENERAL TIRE SERVICE CO. LOCATION: REDWOOD CITY, CALIF. AGE: 29

How do you spend your work day? As one of the younger team members at Redwood General Tire (RGT), my responsibilities have evolved in the seven years I have been here. When I first came on as a service writer at only 22 years of age, I had only a few years of experience. Because RGT is a single location and independent business, the store relies highly on return clientele, which I did not have. And so as a new service writer, it was my responsibility to deal mainly with retail clients, as well as some wholesale and commercial accounts when others weren’t available. Over time, many of the people I helped turned into longtime personal clients. Today I manage more than a dozen large commercial fleet accounts, several large wholesale accounts, a long list of personal clients, and even a few federal contract and government accounts.

What do you expect to be doing 20 years from now? I expect to have partial ownership of Redwood General Tire within 10 years. Within 20 years I expect to be continuing my efforts to grow and develop the company, and perhaps open another location. What’s the biggest issue facing the industry today? The biggest challenge in the industry today is the advent of the internet. In the past, clients looked to tire dealers and automotive repair facilities for answers when it came to their vehicles. But today, many clients come in knowing, or thinking that they know better than our service advisors. This can be a good thing as an informed client is likely to better understand our explanations, but it can also be challenging to gain a client’s trust if they have been misinformed or misled by the internet. What’s the worst cliché made about your generation? There is an age-old idea that automotive facilities and their workers are out to rip you off. I think there are businesses such as ours that have put customer service, satisfaction and retention at the top of their list, so this idea is slowly disappearing.

Braden Crockett JOB TITLE: DIRECTOR OF AUTO SERVICE/ PARTNER COMPANY: MATTHEWS REAL ESTATE INVESTMENT SERVICES LOCATION: EL SEGUNDO, CALIF. AGE: 24

What’s the biggest challenge you’ve faced in your career? The biggest challenge I have faced thus far has been in negotiating with auto service business owners during the joint sale of their business and real estate. At first it was frustrating dealing with owners who had unrealistic expectations. But through the experience of multiple sales, it dawned on me that it was better to

MTD November 2017

take a more personal approach. These operators had spent their entire lives and poured their blood, sweat and tears into building their businesses. These operators came to the decision it was time to cash in on their life’s work, but they often have trouble letting go due to a strong emotional attachment. Thus the biggest challenge was to ease the pain and remind them of what a great opportunity awaited them in an overdue retirement. What’s your biggest accomplishment in the industry? My biggest accomplishment occurred very recently when I was offered partner at our firm, which solidifies an ownership stake in the company. Our CEO, Kyle Matthews, conveyed that the decision was ultimately made due to impressive statistics and volume of transactions. In the past 18 months I personally have closed over 50 auto service property and business asset sales worth a total value of approximately $70 million. I now manage a team of five brokers and in the pipeline we have another $17 million under contract, and are negotiating contracts on another $38 million of auto service sales. If all of these successfully close, the total properties will encompass 24 states, 60 different cities and over 100 locations totaling more than $100 million in value.

Roger Strider JOB TITLE: TECHNICIAN COMPANY: J.P. THOMAS & CO., DBA THOMAS TIRE & AUTOMOTIVE LOCATION: ASHEBORO, N.C. AGE: 23

What’s the biggest issue facing the industry today? I think the biggest issue is finding people who want to repair vehicles as a career, and finding people who are capable of diagnosing and repairing vehicles properly. What’s the one thing you wish someone would have told you before you entered the industry? How much money they had invested in tools over the course of their career. What keeps you up at night? A vehicle sitting in the shop that I didn’t get diagnosed and repaired before I went home. How do you encourage others to enter the industry? Cars are like people, they are not going away anytime soon. As long as people are driving, vehicles are going to break down, need maintenance and tires. Being an automotive technician is a skill no one can take from you.

Steve Campanella JOB TITLE: DIRECTOR OF BUSINESS SOLUTIONS COMPANY: ALLIANCE TIRE AMERICAS INC. LOCATION: WAKEFIELD, MASS. AGE: 28

What was your first job in the industry? My first position in the tire industry was the business intelligence manager at Alliance. The role was a new one for the company and focused on developing processes for pricing strategy, competitor research, studying general market trends, and financial analysis for sales and marketing programs. Who has had the biggest influence on your career? Two who stand out are Dhaval Nanavati, president of Alliance Tire Group’s South America business and a vice president of U.S. Aftermarket Sales, and Bob Arnold, Alliance’s other U.S. Aftermarket Sales vice president. They have pushed me to learn as much as possible with great exposure to all departments of our company. Both Bob and Dhaval have pushed me to consider new angles in the industry and how my role fits in, and they’ve driven me to take on more to expand my reach.

How do you spend your work day? Most of my days are spent analyzing competitor pricing versus ours, developing pricing and marketing programs to help spur sales, working on financial analytics to make sure our programs make money, and talking with our field sales team to see what else we can do to help with pricing and product in the market. I am frequently buried in Excel files, industry reports and email exchanges with the sales team. Tell us something about yourself others might not know. I am painfully afraid of heights but I have been skydiving! My mother still to this day will watch the YouTube clip of it if she needs a good laugh.

Vahe Michaelian JOB TITLE: WAREHOUSE MANAGER COMPANY: 1-800EVERYRIM.COM LLC LOCATION: SANTA FE SPRINGS, CALIF. AGE: 25

What was your first job in the industry? I started out preparing wheels for shipment, cleaning, touching up and boxing. I also did other warehouse duties, including checking and sorting wheels, and making delivery runs.

What’s the biggest challenge you‘ve faced in your career? Moving into a position of management and earning the respect of more experienced people, and learning every day how to be better at something when I had little experience.

MTD November 2017

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Who has had the biggest influence on your career? My uncle Billy Eordekian has had the biggest influence on my career. He has been involved in the industry his whole life and gave me an opportunity to work. His passion has inspired mine. What’s your biggest accomplishment in the industry? I’m currently a board member in the California Tire Dealers Association, and at the age of 24 I was the youngest board member in the association’s history.

Erin Edminister JOB TITLE: ASSISTANT MARKETING MANAGER COMPANY: BKT USA INC. LOCATION: AKRON, OHIO AGE: 27

How do you spend your work day? One of my favorite parts of my job is that every day is different and has its own unique set of challenges. This time of year, I am focused on our trade shows, such as the SEMA Show, and developing the U.S. media plan for 2018. The day can include social media, advertising, sponsorships, point-of-sale distribution and customer communications. In a given day I can also be working with our offices in Italy and India.

What’s the biggest issue facing the industry today? The ever-changing demands of our consumers and the job sites. Sales and marketing are evolving at an increasing pace. New demands, techniques and advancements in technology make this a cutting-edge industry and to succeed you always need to be a few steps ahead of your competitors. What’s the worst cliché made about your generation? That we all feel entitled and are lazy.

What’s your guilty pleasure? Eating ice cream under a blanket on the couch, watching reruns of Law & Order.

Fausto Astudillo JOB TITLE: SERVICE ADVISOR COMPANY: LENHART’S SERVICE CENTER TIRE PROS LLC LOCATION: NORTH HUNTINGDON, PA. AGE: 26

How do you spend your work day? Well, my job consists of handling all sales at the shop, building estimates, directing staff on what jobs to do and opening and

closing the shop — whatever it takes to help the team. I spend most of my day making sure the shop is running smoothly and the guys have work to do from my selling. When I have free time I’m doing training, whether it’s about tires or vehicle mechanics.

What’s the biggest issue facing the industry today? I’d say one of the biggest issues is the vehicles themselves. They are constantly changing with new technology every year, and that’s why I think training is so important.

What’s the one thing you wish someone would have told you before you entered the industry? How many personalities I have to deal with on a daily basis. Tell us something about yourself others might not know. When I was young I was an amateur kick boxer. Other than your cell phone, what’s a tool you must have to get through a work day? My pens and the computer. I’m constantly writing things down and taking notes.

Thomas Dobson JOB TITLE: OWNER COMPANY: WOODSTOCK REPAIR & SERVICES LLC LOCATION: NORTH FRANKLIN, CONN. AGE: 34

What was your first job in the industry? My father has owned Pomfret Tire since 1991, and had Jim’s Tire in Massachusetts before that. I grew up changing truck tires. When I was approximately 10 years old I was swinging the hammer on tube-type tires until I missed and hit my ankle, went and cried in the corner, then came back and kept swinging!

What attracted you to the industry? I enjoyed the tire industry, but I wanted to do more than just tires, so I went to school to be a diesel mechanic. I started my own mobile repair/tire business in 2005. My father is retiring soon, so I bought the family business from him. I now run two businesses. What’s your biggest accomplishment in the industry? I am most proud of my reputation. I started in 2005 with just a small F-350 and a box of tools. I hired a high school dropout as an apprentice to keep him off the dark roads, and he has now

MTD November 2017

been working for me for nine years and is in his own service truck. I have a wonderful relationship with dealers and other shops in the area; we all work together for a common goal of helping the customer stay on the road safely. What class(es) do you wish you had paid more attention to in high school? I went to a tech school but never took it super seriously, and I regret that wholeheartedly. Funny how you hate learning when you’re young, but love it when you get older.

Wade Eaves JOB TITLE: ENGINEER COMPANY: COOPER TIRE & RUBBER CO. LOCATION: TEXARKANA, ARK. AGE: 36

What was your first job in the industry? My career in the tire industry began at Cooper. I started as an engineering intern between my junior and senior years of college and was hired full-time following graduation. I feel fortunate to have been able to work in most areas of the plant from mixing to finishing and everywhere in between. Today, my role involves very detailed new equipment installations and replacements of older equipment.

What’s your biggest accomplishment in the industry? Working on new equipment installations. My biggest accomplishment was the completion of a system install that helped automate the sorting and palletizing of tires. This was very challenging work integrating many areas of the process, but the result of gained efficiencies made it well worth the effort.

What’s the biggest issue facing the industry today? Finding a skilled workforce interested in manufacturing. Tell us something about yourself others might not know. After hours, my father and I own and operate Archery Outfitters Pro Shop. We have two locations, one in Texarkana, Ark., and another in Searcy, Ark. We have been in business for 12 years and continue to grow. If we took your cell phone away and said it would cost you $1,000 to get it back, how long would you survive until you paid the ransom? I actually have two phones, so I could manage!

Kelly Sumner JOB TITLE: NORTHEAST MARKETING MANAGER COMPANY: TIRE PROS/AMERICAN TIRE DISTRIBUTORS INC. LOCATION: HUNTERSVILLE, N.C. AGE: 35

How do you spend your work day? My phone is usually buzzing around 5 a.m. I glance over the flood of emails that await me to see if there are any hot fires. I check in with the support team that keeps me afloat. They are

my limbs and how things get done. Depending on the calendar, I could have a few conference calls scheduled. When I am not on the phone, (it typically has to be recharged twice a day), there is a to-do list of items that I need to either accomplish for a Tire Pros franchisee or an answer I need to get back to the support team.

What’s the biggest issue facing the industry today? Change in consumer purchasing behavior. As I work with several successful business owners, they have contributed sweat, blood and tears to grow their businesses. They did what others would not do. The way shoppers select a business continues to change dramatically every year and the way tire retailers connect with consumers will have to change, too. Without adapting to those changes, independent tire retailers suffer the ultimate consequence of going out of business.

What’s the worst cliché made about your generation? I typically hear the word “entitled” thrown around a lot. There are several millennials on the team I work with. Entitled is simply not the case. I work hard, I’m tenacious, I take accountability, I contribute and I want to learn.

Josh Penfold JOB TITLE: E-COMMERCE MANAGER COMPANY: CARLSTAR GROUP LLC LOCATION: FRANKLIN, TENN. AGE: 38

What attracted you to the industry? I was attracted by the opportunity for growth to modernize decadesold practices. My job is to make it easier for distributors and dealers to get information on our products and transact with us.

Who has had the biggest influence on your career? My biggest influence for e-commerce has to be Jeff Bezos from Amazon. Watching what he does with his mountain of a company makes me always think to stay on my toes, or risk getting my lunch eaten by my competitors. You have to treat every year like year one in the business and never settle for OK. What’s your favorite weekend activity? I volunteer weekly with the local Cub Scout Pack and teach them the skills I learned from being an Eagle Scout.

MTD November 2017

What do you expect to be doing 20 years from now? Spending as much time as possible volunteering and helping build a better future for my children. (He’s a father of seven!)

Loudan Hammersmith JOB TITLE: REGIONAL SALES MANAGER FOR THE CENTRAL U.S. COMPANY: BKT USA INC. LOCATION: AKRON, OHIO AGE: 31

What was your first job in the industry? I was a marketing analyst at Hercules Tire and Rubber Co.

What attracted you to the industry? After graduating college with a degree in accounting, I was looking for a job in the accounting world. What I found at Hercules was a job that would keep me close to the numbers while also challenging me with an industry I knew nothing about. I soon became intrigued with the industry and all of the intricacies involved from wholesale down to the retail level.

Tell us about your current job and responsibilities. How do you spend your work day? I am the regional sales manager for BKT in the Central U.S. Every day out in the field is different and exciting. One day I may be visiting our associate dealer network and the next I am in the quarry tracking the performance of our OTR tires. Other than your cell phone, what’s a tool you must have to get through a work day? I would say a GPS is essential for my job. I cover nine states and Ohio is probably the only one I can navigate without getting lost.

Cody Diemer JOB TITLE: MAINTENANCE SCHEDULER COMPANY: COOPER TIRE & RUBBER CO. LOCATION: FINDLAY, OHIO AGE: 27

What attracted you to the industry? I knew Cooper Tire was the place for me as soon as I got my feet wet in the manufacturing plant. After spending a summer working as a vacation replacement at Cooper I changed my college major to pursue a career in manufacturing. What’s the biggest challenge you’ve faced in your career?

Both of the positions I have held at Cooper have been new roles, so coming into these positions I have needed to develop the jobs’ responsibilities and expectations. In each case, my goal was to increase the reliability of our equipment. These positions also included an additional element of difficulty as they required me to challenge the status quo to ensure what we ‘used to do’ or ‘have always done’ didn’t serve as a barrier to making progress. How do you spend your work day? I oversee and coordinate a workforce that provides preventative and reactive maintenance for electrical, mechanical, plumbing and more to minimize equipment downtime. I spend my day executing planned work that was scheduled for that day and juggling the unexpected with a set workforce, all in the effort of maintaining production.

Jason Cieslinski JOB TITLE: REGIONAL RETAIL BUSINESS CONSULTANT COMPANY: TIRE PROS/AMERICAN TIRE DISTRIBUTORS INC. LOCATION: SAN JOSE, CALIF. AGE: 39

What attracted you to the industry? Family. In the midst of successful career as a sales executive with a corner office in San Francisco, my dad decided he wanted to go a different direction. So he got into the tire business and eventually brought my brothers and me with him. How do you spend your work day? I drive, a lot! My primary responsibility is to ensure dealers get as much as they can out of the Tire Pros franchise system and to aid in growing their bottom line. Dep en d i ng o n the location, my day may be spent working on ways to increase traffic, reduce expenses, track productivity, train employees, work on showroom merchandising and many other opportunities to help Tire Pros dealers become more profitable. What do you expect to be doing 20 years from now? I anticipate being the owner of my own Tire Pros location(s) and working on a succession plan. I also plan to be traveling the world.

What’s the biggest issue facing the industry today? One of the biggest seems to be the pace of change. Many of our owners have been doing this for 30 to 40 years and the fact that there has been more change in the last 10 than the previous 30 creates issues on many fronts. It can be overwhelming to have to change the way you approach everything. ■

MTD November 2017

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Performance winter tires or studless ice and snow tires? The question you need to ask every winter tire buyer By Ann Neal

erformance winter tires are the ideal choice for some, but not every, winter tire buyer. True to their name, performance winter tires provide greater handling and steering response on cold, damp and wet roads than studless ice and snow tires. And compared to all-season tires, performance winter tires provide better traction in snow, slush and ice. But performance winter tires fall short of the snow and ice grip of studless ice and snow tires. “The outright snow and ice traction of a performance winter tire is not quite as good as a studless ice and snow tire,” says Woody Rogers, product information specialist at Tire Rack Inc. So which option is best for a driver who wants extra comfort and safety in the cold months? The answer depends on the vehicle, the local climate and the customer’s driving style.

Performance versus mainstream Drivers who put studless ice and snow tires on their cars give up a bit of the steering response and handling and the “connected driving feel” of a performance tire. “The performance winter tire is geared around a more powerful, higher performing vehicle, or a driver who wants to retain more of the sporty handling of his or her vehicle when the roads are clear,” says Rogers. Performance winter tires typically have higher speed ratings and tend to come in lower profile sizes, making them better suited for American muscle cars, European performance cars, Japanese sports cars and performance luxury cars such as higher-end Lexus, BMW, Audi, and larger Mercedes. “Performance winter tires are definitely more for these performance vehicles and not the mainstream,” says Rogers. But manufacturers offer performance winter tires for some mainstream sedans. “I’d say

it’s fifty-fifty as to more mainstream fitments,” says Rogers. “You may find there are both options available or you may find there’s only the studless tire.” He notes that a performance winter tire has better snow and ice traction than an ultra-high performance all-season tire. Performance winter tires bear the three-peak mountain snowflake symbol that indicates the tires meet the U.S. Tire Manufacturers Association standards.

A performance climate Most climates in the U.S. are what Rogers calls “performance climates,” where the roads are clear and wet during the winter months. “You get icy patches, but it’s not like you are driving through slush and snow six days a week. As a general rule, more clear, dry and wet days, versus snowy days, shift you toward a performance winter tire.”

Ask what customers really want As in all tire sales, the type of winter tire a dealer recommends to customers comes down to what they need for their style of driving, the kind of vehicle they have and the available fitments. But the difference between performance winter tires and studless ice and snow tires adds another layer to the buying decision. “Do customers want maximum snow and ice traction or a balance of snow and ice traction plus clear road handling? That will help them decide between a studless ice and snow tire or a winter performance tire,” says Rogers. If a customer wants something better than an all-season tire and is willing to give up some snow and ice traction in exchange for better handling on clear roads, the choice is the performance winter tire. ■

Performance winter tires: a subset of UHP Tire Rack considers performance winter tires to be a subset of the UHP tire category. “We drop the ultra-high part of it because it is not ultra-high performance from a traditional perspective, which is the dry and wet traction side of the equation,” says Woody Rogers, product information specialist. “Because of the step down in dry and wet performance for this performance winter segment versus ultra-high performance summer or all-season, I don’t know anyone who is bold enough to say a tire is ultra-high performance and winter at the same time.” Although the snow performance of all-season tires as a whole is improving, they lack the ice traction of a dedicated winter tire. Performance winter tires have been improving in the snow, too, but to a smaller degree. “The winter performance is very high even for performance winter tires, so tire manufacturers are making them quieter, improving the wet traction, and working on other aspects, like dry road steering response. And that’s true for both studless ice and snow tires as well as performance winter tires.”

MTD November 2017

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Vehicle inspections help turn demand for winter tires into service sales By Ann Neal

aily car count nearly doubles in the final three months of the year compared to the first three at Matt Story’s Big O Tires store in Louisville, Colo. His store is in the Denver metropolitan area, a part of the country where motorists fully understand the perils of winter driving. To boost service sales, Story and his employees focus on helping customers who are installing winter tires also understand the damage freezing temperatures, Matt Story chairs salted roads and wintery precipita- marketing advisory tion can do to a vehicle’s systems. committees made up of Big O Tires franchisees “We have a competitive advan- at both the national tage because we do mechanical and local levels. service,” he says. “While we do see a strong increase in car count per day during this busy season, we try to capitalize on that by doing all the inspections while we have the vehicles there and offering the services that are recommended. It’s our goal to own the wheel well. We want to get cars in, get the wheels off and perform the inspections so we can offer solutions to the customers.” Winter-specific inspections cover brake and suspension components, as well as a vehicle’s exhaust system, heating and cooling system, battery and charging system, defrosters and wipers, belts and hoses, lights, oil and filters.

Healthy car specials The approach of cold weather is a hook on which to hang marketing promotions, and Story takes full advantage. For example, he promotes “healthy car specials” to help raise consumer awareness of winter car care and get vehicle owners into his stores. He also offers free alignment checks for customers who bring their vehicles to his stores for service or to purchase or install winter tires. “Our goal is to drive as many cars

into our stores every day as we can. We do that by offering healthy car specials so people can have their antifreeze topped off and make sure their wipers are in good shape.” His stores provide free washer fluid top off throughout the winter “in order to be that one-stop shop where people can come in and get everything handled at one place.” Story’s coupon strategy is focused on steering customers to his store just before the rush for winter tires begins. “We run incentivized early winter tire changeovers in the first half of October,” he says. “We want to try to incentivize people to come in a little early and get winter tires on when they don’t have such a long wait. That benefits us as well because it makes staffing a little bit easier. If we can expand that busy time by making it 20% less busy and a little bit longer, that’s a lot more effective for us. It makes our inspections better; and it makes our level of service a lot better.”

The winter tire buying season is the busiest in terms of daily car count for Matt Story’s seven-bay Big O Tires store in Louisville, a Denver suburb. The store has 14 employees.

Inspections build sales momentum The emphasis on vehicle inspections for customers whose immediate need is winter tires helps keep the sales momentum rolling into the first three months of the year. “Our goal is to take that customer who has the immediate need, be able to provide a level of service where we can gain their trust and gain them as an ongoing customer,” says Story. “We don’t want to see them once in November and not see them again. We want to see them back for an oil change. We want to see them for whatever we recommended in November later in the first part of the next year. Our goal is to convert that tire customer into a tire and service customer.” Even in mild climates, the change of seasons can be a boost to sales of winter tires and vehicle service. Story notes that advances in winter tire technology have redefined the winter tire buyer. “We used to call them snow tires because they

MTD November 2017

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Winter car care were high void tires and worked well in snow specifically. But now a winter tire makes a gigantic difference any time you are driving in a climate that’s 45 degrees or less in temperature. You don’t have to live in the snowiest state in the country to have a need for a winter tire.” The change of seasons is just a marker in the consumer’s mind, says Story. “Winter’s here, it’s time to get my car ready for winter. That might mean an antifreeze fluid exchange or new wiper blades. It’s an opportunity.” To reach potential customers, Story uses radio and television for local advertising. His digital marketing strategy relies on search engine marketing (SEM). The Big O Tires organization offers SEM and other digital marketing support to its franchisees, and Story has dedicated a portion of his budget to SEM to increase search traffic to his website. Story joined TBC Corp.’s Big O Tires subsidiary as a tire installer at a store in Denver in 1997. He eventually took a position at Big O Tires corporate office, which was located in Denver at the time. In 2003 he partnered with Mike Lyons, a member of the Big O Tires Hall of Fame, to open his first store in Louisville. He eventually bought out Lyons’ share. Today he owns the Louisville store and is a partner with Drew Prange in two other stores. Prange also owns a store. All four Big O Tires outlets are located in the Denver area. “We have our own stores and we have our partner businesses, and it works really well for us,” says Story. “We try to manage them as a four-store unit even though there are some ownership differences between them.” ■

If you want more service sales, always do this Big O Tires franchisee Matt Story has found documenting a vehicle’s mileage to be an effective tactic for boosting service sales. “As we all know, the industry has shifted from a repair-based business to a maintenance-based business,” says Story. “By simply getting the mileage on the front side of the customer experience, we can start the recommendation process based on the vehicle manufacturer’s recommendations. Getting the mileage and checking the vehicle manufacturer’s recommendations is likely the most important inspection you can do.” Story’s technicians also perform the following inspections to help increase service sales during the winter months: • brakes; • suspension; • steering components; • alignment (free alignment checks); • lights ; • wipers ; • anti-freeze; • fluids; and • engine air filter and cabin air filter.

MTD November 2017

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feature

Pinpointing the moder Manufacturers market to the full spectrum By Joy Kopcha

n our August cover story we analyzed the growth of the M/T tire market — 19 manufacturers have released 11 new tires in the last two years. Here’s a roundup of their latest offerings, plus their answers to an important question: Which consumer are you trying to reach? Are these tires for the enthusiasts seeking adventures, or their buttoned-down brethren chasing a certain look? Or both?

Michael Mathis, president of Atturo Tire Corp.: The Atturo Trail Blade M/T is marketed to all segments of the M/T market — those who need an off-road-capable tire on a regular basis for work, weekend off-road enthusiasts, and custom truck owners who want the menacing sidewall of

our knife blade-inspired design. Of course, Atturo always speaks to the value-conscious consumer who wants to keep performance within reach. Brandon Sturgis, product manager for BFGoodrich off-road tires, Michelin North America Inc.: We call this consumer the “performance seeker.” It’s a driver who demands off-road performance, relies heavily on their equipment to get to the locations that matter to them, be it for camping, hunting, fishing or recreational off-roading. Driving is a pursuit of adventure for this consumer and we design these tires for those enthusiasts who push themselves and their vehicles to the limit. They are highly knowledgeable about their trucks and Jeeps and tires and aren’t interested in something that

n M/T tire customer just looks tough; it has to back it up. While aesthetics are often important to them, it has to perform as well. Maurice King, product manager for Bridgestone Americas Tire Operations LLC: We are targeting adventure seekers, weekend warriors and off-road enthusiasts with our M/T product and marketing efforts. Essentially, we are trying to reach two types of M/T consumers. The first M/T end user values aggressive off-road capability. They want traction and performance on dry rocks, wet rocks, creeks, mud and sand. The other M/T consumer we’re trying to reach is interested primarily in the look of the tire — they are seeking a rugged, tough aesthetic for their vehicle. Scott Jamieson, director of product management in

North America for Cooper Tire & Rubber Co.: Consumers who use their Cooper Discoverer STT Pro tires for off-road driving are looking for a tire to take them where other tires can’t — across harsh terrain to new adventures. Others are looking for tires that provide cosmetic appeal to their vehicle through tread and buttress design, without giving up road manners. Drew Howlett, product manager for light truck and SUV tires for Falken Tire Corp.: Falken is targeting the true off-road enthusiast with our WildPeak M/T, the consumer who goes off-road and explores for recreation or even competition. On the other hand, the WildPeak M/T was tested to ensure it works equally well for the lifted truck

M/T tires that never leaves the pavement, or at the opposite end of the spectrum, the consumer who truly needs the M/T to get to and from a remote location, where roads may not even exist. Barry Terzaken, light truck and SUV tire product manager in the Americas for Continental Tire the Americas LLC: We’re targeting two distinct groups — the serious off-road enthusiast, where the capabilities of the Grabber X3 shine, and the customer wanting that very aggressive look without actually going off-road, yet they require good on-road characteristics which the X3 also provides.

Falken WildPeak M/T

Bob Toth, director of industry relations for Goodyear Tire & Rubber Co.: Our M/T tire marketing targets the off-road enthusiast and the off-road enthusiast at heart. Yg Lee, product manager for Hankook Tire America Corp.: We are targeting consumers who are looking for a highperformance tire that provides stability and traction in both on-/off-road conditions. Recreational thrill-seekers perfectly fit our “driving emotion” mantra, and we love meeting — and exceeding — their tire expectations. Steven Liu, senior director of proprietary brands for American Tire Distributors Inc., which owns Hercules Tire & Rubber Co.: We definitely want to reach the hard-core enthusiasts. We launched a campaign for the Terra Trac Traction Series in Petersen’s 4Wheel and Off-Road that features Lucas Oil Off Road driver Sarah Burgess, who drives on our Terra Trac M/T tires. We believe that if we can convince the enthusiasts that our products perform, they will make the recommendations and the others will take their lead. Because at the end of the day, we need to capture those

weekend warriors and casual enthusiasts; that’s where much of the market is right now. That’s why we’re also working with our dealers to emphasize on a more one-to-one level that our Terra Trac M/T tires (and all of our Traction Series tires) offer road hazard protection and a 30-day test drive. That’s the “extra something” that helps our dealers seal the deal. Brandon Stotsenburg, vice president of automotive for Kenda Tires USA: Kenda sees the off-road market in three types of customers. Avid off-roaders often have a dedicated vehicle and trailer for specific environments which could include desert, mud/trail or other activities depending on the geographic location. The work truck category includes individuals and businesses that require a strong performing M/T tire. And the aspirants are the “wanna-bes” who like the look and feel of the off-road vehicle. This sub-segment often demonstrates that the vehicle represents a lifestyle message, and the tire brand, tire look and on-road ride/noise levels are often more important than the actual off-road performance. These folks often will spend considerable money on lifted vehicles, wheels, tires and suspension upgrades to achieve the overall appearance of the vehicles. Our target consumer in each segment will do research to look for the true value of a strong performing tire at a good price point. The Kenda Klever M/T consumer wants a tire that demonstrates great performance and allows them to tell friends and business associates that the Kenda brand is an exceptional value. Steve Bourassa, product director, Nokian Tyres North America Ltd.: With the Nokian Rockproof product line, we initially targeted commercial operators in the oil and gas, mining and forestry industries who depend upon durability for their livelihood. However, after the initial launch, we received such strong consumer and dealer support (one customer even tattooed the tread pattern on his leg) for this product that we have expanded to serve consumers who value commercial-grade products. Ultimately, the product speaks for itself as consumers seek it out and validate its performance through personal testimony. Marcus Hancock, vice president of global technology for Omni United (S) Pte. Ltd.: The M/T offering from Radar is primarily targeted at off-road enthusiasts who want a dependable, durable and aggressive looking product without having to empty

Firestone Destination M/T2

General Grabber X3

Atturo Trail Blade M/T

Goodyear Wrangler MT/R

MTD November 2017

Are You The Best Of The Best?

Will You Take Home The First Ever Mr. Tire/Big 3 Commerical Tire Dealer Of The Year Award? The 2017 Modern Tire Dealer Mr. Tire/Big 3 Commercial Tire Dealer of the Year award is designed to recognize the tire dealership that is quite simply “The Best” among independent commercial tire shops. Modern Tire Dealer is working with K&M Tire to bring you the 1st Annual Mr. Tire/Big 3 Commercial Tire Dealer of the Year Award. The winner will be announced at the K&M Dealer Conference in January 2018. Winner Receives: 

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Nominations* will open on September 15th, 2017 and will be accepted through November 10th, 2017. Please register by visiting the online registration site www.mrtirectdcontest.com and nominate your dealership today! * This contest is for all eligible Mr. Tire and Big 3 Tire dealers only. Winner will be announced at the 2018 K&M Tire Dealer Conference on January 11th & 12th at the Renaissance Schaumburg Convention Center outside of Chicago, IL.

M/T tires their pockets. This value offering from Radar is targeted at enthusiasts that want a reliable and durable tire with no compromise to off-road traction and handling even in the harshest off-road conditions. Being available in 46 sizes ranging in rim diameters from 15 inches to 22 inches makes this range suitable for drivers of most popular SUVs and light trucks and those who have modified their vehicles with lift kits. Nick Gutierrez, sales director for Sentury Tire Americas: We have a great nationwide network of distribution and through education of the technology and development poured into our LT segment, we target the consumer who wants more than just a price point tire. The consumer that wants features and benefits. Usually the consumer that buys our products wants the next level up tire, not the cheapest. Jon Vance, vice president of product marketing for TBC Brands LLC: We are primarily targeting the budget conscious

Nokian Rockproof

consumer/enthusiast seeking a high value, high quality, aesthetically appealing and affordable alternative to the higher tier products in the market. Andrew Hoit, vice president of sales and marketing for the national brands division of Tireco Inc.: The off-road enthusiasts are obviously a target, but also the average consumer looking for an aggressive look who doesnâ€™t want to sacrifice on road performance is also our customer. Our high value position in the marketplace makes us a compelling alternative to other options. Chris Gomez, light truck product marketing manager for Toyo Tire U.S.A. Corp.: With our advertising, involvement in off-road racing, brand partnerships and events, we are targeting multiple customers and their various lifestyles and preferences in the mud terrain segment. Off-road enthusiasts trust the durability and off-road performance

of the Open Country M/T for its proven use with 2017 Sanctioning Committee Off Road Events (SCORE) Baja 500 Champion Andy McMillin and past SCORE Baja 1000 Champions Robby Gordon and BJ Baldwin. Consumers seeking an aggressive look for their daily-driven trucks are attracted to the Open Country M/T through our product advertising and brand partnerships. These platforms leverage not only the tireâ€™s performance but also its aggressive tread pattern and sidewall design. Lastly, our event programs allow us to showcase the capabilities and looks of the Open Country M/T for those customers who are looking for the perfect balance of mud terrain performance, style and off- and on-road performance. Andrew Briggs, senior director of tire business and product planning for Yokohama Tire Corp.: We are targeting the most demanding and discerning of consumers. Those that expect a high level of performance, both on-road as well as off-road, and an aggressive look that exceeds their expectations. These consumers often modify their trucks or Jeeps with other performance-related aftermarket parts and ultimately take their vehicles through some harsh environments. We created a tire that can stand up to such abuse and will allow these consumers to use their trucks as intended. Richard Li, marketing director for Zhongce Rubber Group Co. Ltd. (ZC Rubber): The M/T and Extreme M/T markets are focused on different customers who have different tastes and demands.

MTD: Tell us about your current M/T tire. Mathis, Atturo: The Trail Blade M/T features distinctive tread blocks and sidewall treads that are modeled after knife blades, providing the off-road traction and menacing style which has led to market success. Sturgis, BFGoodrich: The BFGoodrich Mud-Terrain T/A KM2 tire provides rugged dependability to overcome nearly any obstacle while providing better road manners than expected in an off-road tire. The three-ply construction resists cuts and bruises, and aggressive sidewall lugs and compounds are inspired by the BFGoodrich Krawler T/A KX. That means more bite and sidewall protection, along with increased strength and resistance to bruising caused by rocks and rough trails, and even wear characteristics. The tire is designated Baja Champion. King, Bridgestone: The Firestone Destination M/T2 tire is built for the most

Hankook Dynapro MT RT03

Hercules Terra Trac M/T

BFGoodrich Mud-Terrain T/A KM2

Kenda Klever M/T KR29

MTD November 2017

M/T tires demanding off-road conditions. It features an all-new tread compound and three-ply sidewall construction that increases the tire’s durability compared to its predecessor, the Destination M/T, and provides stronger resistance to chips and tears. The tire has stone and mud rejectors to keep the tread clear of debris, and 23-degree attack angles in the tread pattern give the tire strong pulling power. Another key feature is 20% more biting edges, allowing for enhanced grip on slick, wet surfaces and in snow. It’s available in 29 sizes covering 15-inch to 22-inch rim diameters and 31-inch to 37-inch outer diameter (OD) flotation sizes.

Tireco Milestar Patagonia M/T

Jamieson, Cooper: The Discoverer STT Pro is Cooper’s most advanced, extreme tire to date. The Discoverer STT Pro provides traction and performance in some of the harshest terrains on earth. The distinctive tread design and compound provide on-theroad performance without sacrificing off-road traction. The three-ply Armor Tek3 silica tread compound, aggressive 3-2 center rib design, side-biters and more allow drivers to push the tire to the limits and discover what their vehicles are truly capable of. Cooper also offers the Mastercraft Courser MXT, a two-ply design off-road M/T tire for light truck owners seeking a great looking tire at a value price point. The Cooper Discoverer MTP is an M/T option available exclusively through Discount Tire outlets. Howlett, Falken: Prototypes of the WildPeak M/T existed on the market for many years prior to launch, and the tire was tested in a variety of harsh, off-road motorsports events such as the King of the Hammers, Baja 1000, and Four Wheeler’s Ultimate Adventure. Off-road traction on mud and a rugged terrain was paramount for this

product, along with durability, especially in the sidewall. It features a Duraspec three-ply construction with high-ply turn-ups around the bead, making the tire five-plies thick where protection is needed in the most vulnerable area of the sidewall. Its durability and quiet ride set it apart. Terzaken, General: The Grabber X3 is an extreme terrain tire that delivers off-road performance in mud, dirt and rock for light trucks and SUVs. After spending more than three years developing the tire, since its release in August 2016 the company has received positive reviews within the off-road community. The three-ply construction and signature red letters are popular elements of this tire. Toth, Goodyear: The Wrangler MT/R with Kevlar is an extreme off-road expedition tire reinforced with DuPont Kevlar fiber plus Durawall technology to help resist punctures when powering over rocks, mud and sand. The use of Kevlar and Goodyear’s patented Durawall technology bring sidewall cut and puncture resistance to an area of the tire that demands extra toughness when driving off road. It also helps reinforce the sidewall for when drivers return to the pavement for the ride home. The Wrangler MT/R with Kevlar features an advanced silica compound that helps with wet traction performance both on and off the road. Lee, Hankook: The Dynapro MT RT03 is available in 30 M/T sizes, with enhanced features such as protection blocks on the sidewall to handle rough road conditions. Not only do the blocks have an appealing appearance, but they also shield against the shock of protruding objects. This tire defends against pothole damage and improves traction in soft dirt. The grooves on the tire are designed to eject foreign objects that could get stuck within. They also enhance handling capabilities, especially important for M/T tires. The zigzag shoulder pattern delivers greater off-road traction and the grooves are shaped to keep dirt out and provide the firmest grip. Liu, Hercules: The Terra Trac M/T is a modern mud tire, designed for the way consumers really drive — usually on the road much more than off. It has a high-low tread design that allows for a lower voidto-rubber ratio in the middle of the tread, which approximates a center rib to deliver better handling, comfort and a quieter ride. The tire still needs to get the seal of approval from enthusiasts, so there’s a high void-torubber ratio on the outside of the tread so

Sentury Delinte DX-9

Omni United Renegade R7

TBC Mud Claw Extreme M/T

Toyo Open Country M/T

MTD November 2017

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M/T tires the off-road traction is uncompromised. As far as aesthetics, there’s an optional camouflage sidewall design that’s been popular. Stotsenburg, Kenda: The Kenda M/T KR29 is an option for off-road enthusiasts or individuals who require a high traction tire for their personal and work environments. The scalloped shoulder blocks are staggered to ensure improved traction in loose or soft surfaces, and the specialty chip and cut resistant, off-road tread compound is engineered for long life and reasonable on-road ride and noise. The tire features full depth sipes for improved wet and snow traction, with options for three-ply sidewalls to improve durability. It’s available in 25 offerings in sizes from 15 inches to 22 inches. Bourassa, Nokian: The Nokian Rockproof was originally developed in conjunction with Nokian Heavy Tyres for light trucks and SUVs. Featuring commercial-grade innovations including a new cut-resistant hybrid tread compound and aggressive tread pattern, the Nokian Rockproof provides durability in rough off-road conditions. It also features tread block support for more precise handling,

Yokohama Geolandar M/T G003

stone ejectors and Nokian’s Aramid sidewall technology which make it more resistant to impacts and cuts. Hancock, Omni United: From the success of the Renegade R5, engineers continued their research and development and launched the Renegade R7. The R7 is designed on similar design philosophies as the R5 but additionally offers features like a reinforced three-ply casing for high

durability and state-of-the-art stone ejector technology which prevents stone retention and subsequent tire damage. This range is available in 46 sizes and in rim diameters up to 22 inches and overall diameters up to 37 inches that fit on most of today’s SUVs, light trucks and vehicles with lift kits. Gutierrez, Sentury: The Delinte DX-9 and Landsail CLX-9 are the ultimate M/T tire, put through personal testing in the Mojave Desert at all speeds and intense terrains. The tire features puncture guard toughness, a super stable shoulder, and wetland optimized grooves. It’s got the best ratio of rubber and tread void to effectively expel dirt from the tire under extreme road conditions. Vance, TBC: Our current M/T offering is the Mud Claw Extreme M/T, which has been designed to incorporate the primary features, benefits and design attributes of a higher tiered product into an affordable product package that appeals to budget minded enthusiasts. The Mud Claw M/T features 28 LT and flotation sizes in 15-inch to 20-inch rim diameters, and a pair of 22-inch fitments were added in September. The Mud Claw Extreme M/T is pinned for studs and offers a three-ply sidewall design in 18- to 20-inch sizes. Hoit, Tireco: Our newest M/T product is the Milestar Patagonia M/T. It entered the marketplace in 2016 and is the best of both worlds. It has a unique tread pattern that combines aggressive looks with smooth and surprisingly quiet performance on the street. The center of the tread pattern provides the smooth and consistent ride on the pavement while the aggressive shoulder blocks provide outstanding off road performance when aired down. All sizes come with strong three-ply sidewall construction for added durability. Gomez, Toyo: The Open Country M/T is legendary for durability, offroad performance, long tread life and an aggressive tread pattern. It’s designed to help trucks work hard on pavement, then work just as hard when roads are muddy, snowy, and rocky — or when there are no roads at all. More than 50 sizes are available for 15- through 24-inch rims: metric widths from 235 to 385 mm; flotation sizes ranging from 10.50 to 15.50 inches and diameters up to 40 inches. It’s available up to F Load Range

ZC Rubber Westlake SL366

Cooper Discoverer STT Pro

for late model, high capacity pickups. It is also backed by Toyo’s No Regrets 45-day, 500-mile trial offer. Briggs, Yokohama: Our current M/T tire, the Geolandar M/T G003, entered the market in July with 37 sizes for 15 inches to 20 inches. We focused on several areas during the development, including an updated relevant size lineup, a uniquely aggressive appearance in both the tread and shoulder area, as well as on- and off-road performance. Extensive development has resulted in a tire with better wet braking, longer mileage, a quieter ride on the road and off-road performance. Li, ZC Rubber: ZC Rubber today mainly supplies two kinds of M/T tires: SL366 and SL386. Both tires are applicable for rough roads and a reinforced tire structure is applied. SL366 focuses on price-sensitive customers who mostly use the tires for daily life but sometimes try some exciting experiences. The SL386 is for customers who are seeking extreme experience. ■

MTD November 2017

feature

Wage and hour regulations You probably are not in compliance By Bill Ford

wners and operators of tire dealerships and automotive service shops, no matter how large or small, are being targeted by the United States Department of Labor’s Wage and Hour Division. This is the federal agency that enforces minimum wage, record keeping and overtime rules. Why are they being targeted? The Department of Labor has identified several “low wage” industries as ripe for compliance audits, and “automotive service” is one of these. As such, no longer is a complaint from an employee required for the Department of Labor to walk into your shop one day and inspect your payroll records for the last two years.

The facts More than 45% of the audits conducted within the automotive service industries are directed, meaning the Department of Labor not only takes employee complaints into consideration, but also audits these shops for no other reason than you are an automotive service shop. Here are the facts: • 79% of all directed and non-directed cases within the automotive service industry result in violations and fines. • In 2016, there were 516 cases within the automotive service industry, which resulted in $4,265,193 in back wages. This included 4,650 employees. The amount of back wage monies assessed has doubled just in the last six years.

Given these statistics, every automotive service shop should expect either a Department of Labor directed audit (non-complaint driven, audit outcomes random) or a complaint-driven audit. in the automotive What is concerning is that when we service industry assist owners and operators across the country in responding to the Wage and Hour investigator, they often are completely blind sided and shocked that their pay plans were not in compliance. Wage and hour regulations are extremely complex to begin with. Violations and Fines Further, when applying these wage and hour regulations to automotive service shops that have a number of different types and combinations of pay plans (salary, hourly, commissions, flat rate, spiffs and bonuses), compliance becomes complicated. On the plus side, compliance is attainable and affordable. It’s just a matter of understanding the rules and regulations and how they apply to your business. Because of their complexity, we suggest you contact outside expertise specializing in wage and hour regulations to help you.

79%

Violations and Fines

www.moderntiredealer.com

Case studies To shed some reality on the subject, consider the following actual cases.

Automotive Service, Employer A: This employer owns and operates four stores. Each store has nine to 12 employees plus two “managers.” One store manager runs the front desk and oversees the general operations of the store; the second manager (assistant/service manager) performs service writing and directs techs. The investigator, as in all cases, talked with current employees as well as called past employees to determine job duties and hours of work. Within a matter of weeks, the Department of Labor investigator determined that the employer had two violations. 1. Failing to pay overtime on spiffs and on bonuses paid to service techs and tire technicians (yes, these additional monies paid normally on a monthly or quarterly basis are also overtime eligible). 2. Failing to pay overtime to the assistant/service managers, as the Department of Labor does not consider these positions as exempt from overtime even though they were being paid on a salary plus incentive basis.

The back wages assessed totaled $198,000. The Wage and Hour Division demanded payment immediately. Because the employer wanted to further consider the case due to the severe impact on his operations, the Department of Labor has subsequently sued the company. As a result, at least one and maybe all of the stores will close. Even though the company may go out of business, the Department of Labor also has sued the owner personally for the back wages. Automotive Service, Employer B: One day the Department of Labor investigator walked into this company and asked for the owners. The investigator requested the owners provide two years of payroll information for all 48 employees within one week. The case resulted in the following violation: 1. Not paying overtime on spiffs and bonuses provided to service techs and tire changers. 2. The total back wage assessment, including liquidated damages, was in excess of $12,000.

In addition to the actual financial back wages assessed in these cases, the experience is extremely emotional and stressful. The owners must continue to operate their business while trying

Wage and hour regulations Non-discretionary bonuses = overtime Any spiff, incentive or bonus that is paid to any nonexempt employee is overtime eligible. For example, if tire technician John Doe earns, on average, a $100 per month spiff, and works, on average, 50 hours per week, his additional overtime over the two-year back-wage period adds up quickly. $5 per week x 52 = $260 per year. $260 per year x 2 (back-wage period) = $520. $520 x 2 (liquidated damages) = $1,040. You should note that the U.S. Department of Labor issues liquidated damages automatically, thus doubling the fine.

to compile the voluminous documentation as required by the investigator. If you are investigated, there is no other option but to cooperate and meet their demands.

least time and one-half (on a federal basis that’s $10.88 per hour; check your state for higher minimum wages) is not due overtime. A number of large chains have implemented pay plans that do not meet the definition of a true commission program (“the more you turn, the more you make”) and have been in violation. Ensure your flat rate system is a true commission system that drives productivity versus a flat shop rate for hours turned. Additionally, the commission piece of the pay program must yield at least 51% of the gross pay. If not, overtime is due. 4. Improper deductions. These improper deductions are normally for “short” clock-ins and outs. For a period of time to be unpaid, the period of clocking in and out must be at least 30 minutes or longer. For an example, if an employee clocks out for lunch at 12 p.m. and back in at 12:15 p.m., then the 15 minutes has to be paid because it is less than 30 minutes. This is normally not a factor for most employees within the automotive service shop except for those who are paid strictly by the hour and overtime over 40 hours. Again, as stated above, compliance help is both attainable and affordable.

Final tips In addition to the financial as well as emotional stress on the owners, the other challenges for employers include: the Department of Labor contacting and talking to employees; employees with concerns about management’s credibility; and community rumors that could affect your good name and reputation. So there are many other factors that must be considered in terms of why you should ensure compliance.

Common violations The most common violations within the automotive service industry are as follows: 1. Salaried staff due overtime. Typically, the only position within a shop that meets the “executive exemption” as issued by the Department of Labor would be the owner. In a case of multiple stores, the store manager would be exempt from overtime if his or her primary duty was managing. “Managing as a primary duty” includes hiring, firing, directing employees, training, coaching and counseling, scheduling, etc. A store manager or an assistant manager who 1) is paid on a salary or a combination of salary and commissions without overtime, and 2) is working the counter, engaged in sales, performing service writer work or a combination of any of these as a primary duty, then they are due overtime. Please know that typically an assistant manager and/or service writer would be non-exempt and thus due overtime regardless if you pay them on a guaranteed salary or not. 2. Overtime is due on non-discretionary bonuses. Any spiff, incentive or bonus that is paid to any non-exempt employee is overtime eligible. Year-end discretionary bonuses such as a Christmas bonus would not be considered for this requirement (see example in sidebar). 3. Non-compliant commission on flat rate programs. In a retail setting, a true commissioned employee who earns at

Here are some final suggestions for all owners and operators. • Owners and operators should first review all pay plans. Any position that does not receive overtime needs to be challenged to determine if the position is either exempt form overtime as a manger as defined by the FLSA or meets the requirements of the retail 7(i) commission exemption. • Ensure that your time records are true and accurate and accurately reflect hours of work. Edit time records prior to sending to payroll to determine if there are any missed punches or any improper punches such as for lunch. • Implement overtime payment practices to ensure overtime payments on additional monies paid to non-exempt employees who receive overtime paid on spiffs and other types of incentives for sales, safety, attendance, etc. The difficulty here is that most, if not all, payroll services do not make this calculation on your behalf.

Given the rising percentage that your organization will be audited and that your pay practices are probably not compliant, it behooves you to conduct a brief teleconference with a professional to review your pay plans and determine whether or not you are in compliance. You will be completely shocked and surprised that, in fact, you probably are not in compliance and could (probably will) face significant back-wage payments. ■

About the author Bill Ford is CEO and president of SESCO Management Consultants. SESCO is a human resource consulting firm providing results-oriented human resource consulting services to the automotive service industry. SESCO provides a special “retainer” relationship that provides a free hotline to discuss day-to-day employment issues, including policy development. Ford can be reached by phone at (423) 764-4127 or email at bill@sescomgt.com.

MTD November 2017

Milestar Tires are developed with a focus on superb quality and high performance at an outstanding value. Offering a vast assortment in car, truck, and commercial applications, including niche specialty products, like the rugged PATAGONIA M/T. The PATAGONIA M/T is designed to offer an exceptional balance of on and off-road performance.

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of the trip. One of the most important yet sometimes overlooked tools for a successful off-road adventure are the tires. Tires not only enhance the appearance of a vehicle, they provide ride comfort, traction, and handling. Looking for the tire that’s best for the job?

obstacles this tire can’t overcome. The PATAGONIA M/T can get you where you want to go and without breaking the bank. The PATAGONIA M/T has an array of features designed to tackle these harsh conditions. The tread design is engineered with high void tread blocks, which provide aggressive biting edges, and grip to achieve maximum traction in loose dirt, sand, and mud. The high void also promotes self-cleaning, allowing mud and loose dirt to evacuate the tread void so they don’t stay packed with mud or debris, which can hinder traction. Staggered off-center tread blocks add outstanding lateral stability while enhancing on-the-road performance, making this aggressive tire incredibly street friendly and quiet so that your off-road vehicle can also be your on-road vehicle. Additionally, the PATAGONIA M/T features a strong 3-ply sidewall* which provides additional protection from impact damage and allows you to air down with confidence to increase the tire’s sure-footedness

The PATAGONIA M/T does more than traverse mud. Its superior traction will tackle the harshest of terrain, whether it’s the desert of Baja California, the red rocks of Moab Utah, or the varying terrain of the infamous Rubicon Trail, there are no *Excludes 31x10.5R15LT 2-ply sidewall

as well as increasing the tread’s contact patch. Integrated stone ejectors protect against stone retention and drilling, another feature to give you peace of mind. The PATAGONIA M/T is available today in popular high flotation and LT metric sizes from 15 to 20-inch wheel diameters and overall tire diameters up to 38-inch diameter. Future plans include a 40-inch PATAGONIA M/T in the coming months. Confidence is what you get with the Milestar PATAGONIA M/T.

feature In addition to warning its employees on the dangers of texting and driving, Ramona Tire promotes that message to the public with its “Please make it home safe today” digital billboard on I-215 west of Hemet, Calif. (see sidebar on page 74).

How is the ‘health’ of your business insurance coverage? By Jack West

any of us make it a point to see our doctor for regular checkups. Doing so gives the physician the opportunity to assess the current condition of our health, and gives us a chance to ask questions about medical issues or concerns. A thorough exam can help to diagnose early symptoms and gives the doctor an opportunity to offer recommendations and advice for a healthier lifestyle. This little metaphor on the importance of medical checkups can also apply to tire dealers and their business insurance. Taking care of customers is your number one priority — you listen to their needs, surround the details, and follow through with exceptional service. With all of the day-to-day tasks you encounter, it’s very easy to put business management issues on the back burner to deal with later. As your business changes and grows, so do your business insurance needs. Just as you visit your medical provider for a physical, it is a good idea to consult your insurance advisor, at least annually, to review your insurance coverage in light of changes your business may have undergone. There may be a few of you reading this who think, “If it ain’t broke, don’t fix it.” However, from an insurance standpoint, we do not know if something is “broken” unless we take the proper time to review everything to uncover potential problems. An annual review, or “physical exam,” of your insurance coverages helps ensure that coverage purchased last year adequately protects you today.

Are your property limits accurate? Let’s, for a moment, imagine your business property just got hit by a storm or fire. Not only did the walls collapse and roof fall in, it all fell on everything within those walls. The equipment, inventory, furniture, light fixtures, pictures of your kids — anything and everything — ruined. Now imagine finding out from your insurance provider that, while the walls and roof were insured for full replacement value, not much else was. Failure to calculate replacement value for your business personal property (contents) is a costly mistake some business owners make when valuing their business. Are you prepared for the out-of-pocket costs of being under-insured?

Most insurance companies can provide assistance in properly valuing your building. However, determining the replacement cost of your contents is harder, and it requires your time and expertise. Yes, it may take some time to do a walk-through to list floorto-ceiling contents and determine replacement costs, but it is so worthwhile. It’s the best way to calculate accurate values so you’re adequately covered if you have a claim. The extra time spent now will be much appreciated in the unfortunate event of a loss.

Who owns tour building? It’s typical for many tire dealers to own their building personally and lease it back to the company. If your business is set up this way, you may have a gap in insurance coverage. This often-overlooked gap could result in significant costs for which you’d be personally responsible. For example: John is the majority owner of ABC Tire Inc. He personally owns the building and leases it back to the business. The company has a basic insurance policy with no additional insured endorsements. One day, a customer slipped and fell in the waiting area. The customer sued the business for medical expenses. The customer’s attorney decided to name all involved parties in the lawsuit: ABC Tire Inc., John as the building owner, and the janitorial service as well. In this case, ABC Tire’s insurance policy would provide no defense costs for John or coverage for any settlements he personally owes.

This situation could have been prevented with a simple endorsement, at little or no charge. If ABC Tire’s policy had listed John as an additional insured — since he is the building owner — his personal expense could have been avoided.

All insurers are not created equal So, what should you look for in an insurance company?

1. Investigate the financial strength of any company that insures your business and look for experience in your

MTD November 2017

AND WAGNER SAID, “LET THERE BE MORE LIGHT.” Wagner® BriteLite® and Wagner® TruView® capsules provide exceptional visibility for your customers and a brighter outlook for your business. That is why you should always recommend upgrading to Wagner premium lighting.

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Business insurance industry. Insurance industry analysts such as A.M. Best Co. Inc. can provide current ratings. Be sure the insurer you select has a rating of A or higher. 2. Make sure the company has a history of quality service and commitment to independent tire dealers. Oftentimes your trade association or buying group can be a good resource to help you determine which companies have demonstrated a long-term commitment to protecting their members. 3. Look for a company that can provide proper insurance programming. You have probably heard or read about a variety of high settlements that have occurred from any imaginable type of claim. Dealing with issues such as tire failure, cyber liability and employment-related practices can lead to potential surprises when a loss occurs. Don’t wait until you file a claim to find out if you’ve left your business vulnerable to these exposures.

A company that offers sound risk management programs, tailored to your industry and your business’s unique needs, can add an extra layer of protection for your business by helping you prevent losses before they can happen. Companies specializing in business insurance, especially those that have coverages specifically for tire dealers, should be able to provide an annual check-up of your insurance and risk management programs.

Could a major claim put your company on life support? Business insurance and choosing the right company for your needs is a more complex topic than what can be addressed in a single article. The previous examples and recommendations represent just a few of the many items that should be considered. Is it time for you to assess the performance of your current insurance provider? Start with these few basic checkpoints:

• Are claims paid according to your expectations? • Is the insurer financially sound and stable? • Are you receiving the promised level of policy service and risk management support? How you answer these questions can have a huge impact on your business, and may influence your decision to continue to do business with your current insurance company. You may find that an insurance physical is the best prescription for maintaining the health of your business. ■ Located in Owatonna, Minn., Federated Mutual Insurance Co. is the recommended insurance carrier for the Tire Industry Association and 20 other state, regional and national tire dealer associations. It provides customized coverages and proven risk management strategies to more than 1,000 tire dealers across the country. A solid company backed by a “Superior” rating from A.M. Best, Federated and its Client Service Standards help ensure the coverage you have is the coverage you need. If you would like to meet with a local Federated representative to review your current policy or discuss coverage options, call (800) 533-0472, or log on to federatedinsurance.com. This article is for general information and risk prevention only and should not be considered legal or other expert advice. This is not an offer of insurance. Coverage for claims will be governed by the facts of the claim and the terms of your policy. The recommendations herein may help reduce, but are not guaranteed to eliminate any or all risk of loss. Some of these services provided by third parties wholly independent of Federated. Federated provides its clients with access to these services with the understanding that neither Federated nor its employees provide legal or other expert advice. Qualified counsel should be sought with questions specific to your circumstances.

Employment practices liability Ramona Tire focuses more on avoiding risks at its stores Chris Wyborny is vice president of Ramona Tire Inc., a 16-store chain based in Hemet, Calif. He is also a member of the Independent Tire Dealers Group LLC (ITDG), and has been a member of the Federated Insurance Advisory Council since 2011. Federated Mutual Insurance Co. is a preferred supplier to ITDG. Modern Tire Dealer caught up with Wyborny and asked him what he looks for when reviewing his company’s insurance. “The old saying, ‘If it’s predictable, it’s preventable,’ would probably be the first thing I would look for. Then making sure we have adequate coverage for the risks that we’re exposed to. “There are so many new risks we

face, particularly in California. We’re a litigious state, so we have to worry about not only the risk from our business operations, but also the risks if we’re not managing people right. It all comes down to risk management, making sure you’re adequately covered for a catastrophic loss.” And by “catastrophic loss,” he is not referring to risks insurance typically cover, like lightning strikes or fires. He is talking about employment practices liability. “I’m less concerned about those things than an employee who doesn’t torque the wheels correctly, or sends a customer out with old tires. Or if a tire fails and it comes back that we’re liable because we’re the ex-

pert and didn’t catch it. It’s all the other risks that we’re exposed to, just from our day-to-day operations, that scare me.” In order to minimize risks, Ramona Tire has instituted a “no cell phone policy” in all vehicles. “We have stickers on the dash that warn if the drivers are caught on cell phones, they’re terminated,” he said. Employees also receive continuous training “on the risks they’re exposed to.” The company also has a tire aging policy. “If it’s older than six years, we recommend taking it off,” he said. “That also applies to the spare tire.” Wyborny said Ramona Tire has never had any major loss of any kind, “knock on wood.”

MTD November 2017

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71% of employees are disengaged So what makes you think yours are not? By Mike Townsend

o you see what I see? Of course not! If you could see through your customers’ eyes, they would tell you how well, or how poorly, your employees engage customers. It’s not that easy to track, however. Whether perception or reality, customer service seems to have declined in every business sector, including retail tire stores. A recent Gallup poll revealed 71% of employees today are disengaged. As I like to say, “Training is not something you did, it is something you do.” And it is not always done anymore, at least at an acceptable level. I would like to go a step further and expand on that phrase for 2018: “Training that changes behaviors is not something you did, it is something you do every day.”

My advice is to hire a third party to come in and mystery shop your stores in person and via telephone. If you want to take it to the next level, also hire them to come in and interview all employees to find out how the employees engage with each other as well as their leaders. Remember: Happy employees create happy customers. Employees seem to care more when the boss or owner is around and less when real customers are in the stores, on the phone, or in their parking lots.

Why should this matter? In the retail tire business you are losing customers one poor customer engagement at a time. This happens on the

What is going on? Many business owners, not just retail tire businesses, simply do not know what is really going on in their businesses on a daily basis. Even though they have procedures in place to make sure service goals are met like changing oil and tires properly, keeping families safer, and helping their customers’ cars last longer, many retailers miss what is most crucial to fulfilling their brand proposition. The area I allude to is how their p eo pl e engage customers on the phone and/or in person. It has been said you should, “Inspect what you expect,” but how often, as owners, do you do that? One only need Hiring a third party to come in and watch the popular mystery shop your stores, both in show “Undercover person and via telephone, will help Boss” to see that you see what you can’t see. reality is distorted when an owner, CEO, vice president or regional director shows up. A person who works with a national cinema company recently told me that when the top brass visited, the employees put on a “dog and pony show” and after they left the premises, things went “down hill” and back to the “down hill” normal.

Employees seem to care more when the boss or owner is around and less when real customers are in the stores, on the phone, or in their parking lots.

phone, in your store, and after the sale every day. This happens usually over a period of 24 months. We had a client (prior to our involvement) who lost 2,400 tire units in that same time frame to a new national competitor. These units were lost mainly because the manager of the store was disengaged (giving customers info they could get online), and this attitude trickled down to his employees. Of course the owners had no idea this was happening. The manager’s excuse was the national competitor was stealing business away due to a lower price. Strange that when we listened to phone calls and asked customers the “why” question, seldom was price mentioned as a key reason they had visited the store in the first place. Customers told us these factors were more important:

• professionalism, • a knowledgeable staff, • a sense of trust, • buying from a local company. In my experience, these factors are the same everywhere, with price almost always low on the list of reasons why customers

MTD November 2017

Employee training initially did business with their stores. In this case, by coupling the detailed phone interviews with customer experience training, we were able to help the dealer regain most of those lost tire units without dropping prices.

Are you engaging enough? Before we call to solicit new retail clients, we shop them via phone and in person to be sure we can help move the needle in new customer acquisition; increase profits and sales; and help them build equity in their businesses. The challenge is

How often as owners do you ‘Inspect what you expect’? cutting through the layers of pride and helping CEOs and/or owners understand they will never see their stores like we do. We recently evaluated the greeting and check-in processes for a large hospital chain. The CEO of the hospitals was shocked to see the many photos offering proof that his employees were disengaged. As consumers continue to change, it is important that you change how

See how you can solve customer ride complaints www.hunter.com/mtd

Understanding how to keep your employees happy will send you more business and future employees.

you engage them in order to make the experience more meaningful to them. I will leave you with this quote from a tire dealer who owns four stores: “I did not realize how bad we were until I heard our team talking to customers via recording.” The good news from a competitive standpoint? Everyone else also seems to be that bad. And that’s not good. ■ Mike Townsend is owner of Townsend Strategies, a sales and leadership training and marketing firm. He has nearly 30 years of sales experience, 12 of them in the tire industry. As a Six Sigma black belt and professional trainer, Townsend says he “has witnessed every scenario and heard every objection in the retail tire environment across every state in the U.S.” For more information, call (865) 318-4588 or (800) 319-8552, or email Townsend at mike@townsendstrategies.com.

MTD November 2017

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Your voice on Capitol Hill TIA President David Martin will work to ‘carry forward an effective and results-oriented government affairs program’ By Lori L. Mavrigian

avid Martin became involved with the Tire Industry Association (TIA) in 2012 when Bob Hendry, vice president of 31 Inc., approached him about running for the TIA board of directors. “I was fortunate to win a spot on the board and in time became chairman of the training and education committee,” Martin says. “This proved to be an important step forward for me in my tire industry career and has given me the opportunity to be involved in the legislative process in Washington, D.C. “To participate in the board meetings and witness the efforts and commitment of the board of director members made me proud to play a small role in this association.” That small roll will get a whole lot bigger this month when Martin becomes the association’s president, taking the reins from Tom Formanek (see article on page 88). For the next year, Martin will have to balance his TIA responsibilities with his job as category director of tools and supply for American Tire Distributors Inc. (ATD). At ATD, he has worked with tire installers and has seen the positive effect TIA has had on the industry. “The move to ATD has been the most important in my career. Once I joined the ATD team I came into contact with the tire installers in a different way that provided me insight into their training needs and safety concerns. “The ATD Tool and Supply team has worked with key vendor partners to offer training from TIA-certified trainers. ATD has held more than 800 training sessions over the years while training more than 10,000 tire installers.” Martin says being involved with TIA “has broadened my view and engagement in the industry as a whole. It also provided me the opportunity to serve as a voice of the tire installers with the National Highway Traffic Safety Administration (NHTSA) and work for a fair and equitable tire registration program for all involved and affected by the legislation. This important legislation will impact all tire installers in the United States.” As he takes the gavel, TIA has approximately 10,000 members. In addition to working on tire registration legislation, Martin says he will:

• work to sustain the growth in TIA’s membership and facilitate expansion in the member services programs; • focus on the continued development of TIA’s training and educational programs; and • work with Executive Vice President Roy Littlefield and the

Over the years, new TIA President David Martin has worked for several aftermarket companies and has seen first-hand the important role TIA plays in the safety and well-being of tire installers and other industry members.

new board of directors to carry forward an effective and results-oriented government affairs program on Capitol Hill. TIA is currently working on multiple industry-related government legislation. According to Martin, here are TIA’s positions.

The issue of Last-In, First-out (LIFO) inventory accounting method legislation TIA continues to actively lobby Congressional members to save LIFO. We are very active in the LIFO coalition and have been conducting visits on the Hill to express to members the importance of keeping this accounting system alive for tax purposes. Repeal of LIFO would hurt TIA members. It would significantly hinder the competitiveness of U.S. businesses in the worldwide marketplace by placing a significantly increased tax liability on the companies that use LIFO. Should LIFO be repealed, the consequences for LIFO taxpayers would be more devastating than any other change to the tax rules. The “new revenue” that is touted by supporters of LIFO repeal comes in the way of retroactive taxes. Businesses using LIFO would have to pay retroactive income taxes on deferments they took while using LIFO in the past. Unlike any other tax expenditures that have been discussed for elimination, repeal-

MTD November 2017

Italian Style Product Innovation is in our DNA

Visit the Italian Pavilion to see the latest in automotive innovations

2017 SEMA Show Oct. 31st - Nov. 3rd • Las Vegas Convention Center South Hall (Lower) • Global Tire Expo Section • Booth 43282

EXHIBITING COMPANIES ALGO Booth 42285 www.algo.it

DINO PAOLI SRL Booth 43286 www.dinopaoli.com

CATTINI OLEOPNEUMATICA Booth 43278 www.cattini.eu

ETA BETA Booth 42287 www.etabetawheels.it

DICHEM Booth 43284 www.dichemitaly.com

M&B Booth 42279 www.mbengineering.info

OMER Booth 42289 www.omerlift.com

TIA president ing LIFO is the only proposal that would require a business owner to pay taxes retroactively. Any proposed tax rate reductions would not compensate LIFO taxpayers for the damaging effects to their businesses. Taking LIFO reserves and turning them into taxable income, even spaced out over time, would wreak havoc on cash flows, capital reserves, expansion opportunities and job creation for American businesses using this method of accounting. Saving LIFO remains a top priority for TIA.

The problem is somebody has to pay for this stuff. On the Hill, the Democrats believe that generators of the waste (such as used oil, tires, used batteries or used anti-freeze) should pay for it. Dealers get hauled into that, and that means anybody who generated anything found at that site gets involved. And the Republicans are on the other side saying that you can’t put it all on big businesses, and that all companies that dumped anything in the site should be involved. We’ve testified concerning our position for our members and will continue to do so.

Marketplace Fairness Act for online sales We are very strong supporters of the act. It has the support in the Senate to pass. It does not have the support in the House because Tea Party members see this as a tax increase. We don’t see it that way. We see it as something that’s very unfair for the brick-and-mortar small businessmen in a particular town who are hiring people, who are supporting Boy Scouts, Girl Scouts, Little League teams, etc., and are at a disadvantage when somebody outside sells the product in the state and there’s a difference on the excise tax. It’s just an unfair situation, and we’re still working on it. This affects everything our members sell, it’s not just tires. TIA will continue to push the Marketplace Fairness Act of 2017 so that local family-owned businesses can compete fairly with large online corporations.

Lead wheel weight legislation TIA’s position is that the marketplace will take care of this, and in a matter of time, there won’t be any more lead wheel weights. What’s happening is TIA is seeing bills introduced in states putting a deadline on a ban of the use of lead wheel weights. By 2020, or whenever, you can’t have any more lead wheel weights in the states. TIA feels that’s unfair because dealers have inventories of lead weights that are worth a lot of money. The arguments that there’s all these lead wheel weights on the side of the road are crazy. The numbers opponents throw out are ridiculous. So TIA is opposing lead wheel weight bills, saying let the marketplace take care of itself. The industry is shifting away from lead wheel weights anyway.

Recognizing the Protection of Motorsports (RPM) Act The RMP Act is a bill that was introduced by the Specialty Equipment Market Association (SEMA) in the last Congress and reintroduced in this Congress. It was introduced in the wake of a decision from the Environmental Protection Agency (EPA) that stated street-legal cars could not be converted into race cars. The RPM Act protects Americans’ right to modify street cars and motorcycles into dedicated race vehicles and the industry’s right to sell the parts which enable racers to compete. EPA’s decision would have had an impact felt across the industry. The RMP Act ensures that transforming motor vehicles into race cars used exclusively in competition does not violate the Clean Air Act. The EPA ended up pulling back, but it had extended its jurisdiction and scope further than it ever had on something like this. We’ve been working closely with SEMA on the RPM bill. In the House, it has 139 co-sponsors, and in the Senate, it has 38. So right now, we’re working to get this bill in front of a committee. Retroactive Liability Provisions of Superfund TIA remains committed to repealing the retroactive liability provisions of Superfund. Unfortunately, right now it’s not an issue that’s moving in Congress. It’s a major issue for us. We have dealers in 30 states who have been cited for the cleanup of Superfund sites. In our opinion, it’s very unfair when you make a law retroactive. You have situations where dealers were legitimately having tires picked up by EPA-approved haulers, taken to EPA-approved sites, and then somebody else dumps something in the site that they have no control over and it becomes a Superfund site. The dealers get a notice in the mail, and they have the opportunity to pay thousands for their “fair share” of the cleanup, or they can fight it to the end and still end up paying thousands. That’s not fair to dealers.

Affordable Care Act (ACA) and the Cadillac tax This is an easy answer. TIA has no idea where we’re going on Obamacare. I don’t think anybody in Washington does. With the Republicans in the House and the Senate and White House, many believed that Obamacare would be repealed. We did get extensions on things like the Cadillac tax, but we couldn’t make a wild guess on where health insurance is going to be a year from now. Nobody in Congress knows, and we don’t think that there are votes to get anything through right now. So this is a major issue for our members. We think tire dealers more than almost any other group of small businesses tends to insure people to keep them. It has a huge impact on us. The rules are so ridiculous right now. If you have 49 employees, or 50 employees, there are different regulations. You get to 100 employees and there are different regulations. It’s almost like you’re penalized if you’re growing and doing well. The whole thing with Obamacare was everybody was supposed to be equal. That was the deal with the state tax; that was the deal with the health insurance. We don’t know where that’s going to come out. That’s something we obviously spend a lot of time on. When we go to state conventions, we probably get more questions on health care than any other issue. We certainly were supportive of the repeal, but that’s not going to happen. We don’t know where it’s going to go now. The opportunity for an Estate Tax Repeal TIA is a member of the Family Business Estate Tax Coalition (FBETC). This coalition is dedicated to the full and permanent repeal of the estate tax. With the 115th Congress, the opportunity for Estate Tax Repeal is greater than ever. HR 63 and S 205 amends the Internal Revenue Code to: 1) repeal the estate and generation-skipping

MTD November 2017

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TIA president transfer taxes, and 2) make permanent the maximum 35% gift tax rate and the lifetime gift tax exemption. The bill provides for an inflation adjustment to such exemption amount. TIA supports the Death Tax Repeal Act of 2017 for the following reasons: • Repealing the death tax would spur job creation and grow the economy. It contributes a very small portion of federal revenues. • The death tax is unfair. It makes no sense to require grieving families to pay a confiscatory tax on their loved one’s nest egg. Often this tax is paid by selling family assets like farms and businesses. Other times, employees of the family business must be laid off and payrolls slashed. • For many family-owned businesses to keep in operation after the death of the owner, they must plan for the estate tax. Planning costs associated with the estate tax are a drain on business resources, taking money away from the day-to-day operations and business investment. These additional costs make it more difficult for the business

Personal snapshot Johnathon David Martin, 60, grew up in the small town of Jonesville, N.C. He now lives in Concord, N.C., and works for American Tire Distributors. He started his career in the automotive industry as a Snap-on tool dealer. It was during this time he met C.E. Benton, the person who Martin says had the biggest influence on his In his spare career. They also worked together at time, Martin he likes to Accu Industries, where “he helped says spend time with me understand how to work with his family and customers on an individual basis. friends, play golf, He also taught me how to manage attend profesmy business and the processes of sional sporting and concert making good business decisions.” events and dine He says there have been many chal- out. lenges to face in his career. “With that said, learning how to move forward regardless of the odds and how big the challenge may appear is what makes the difference between a winner and a loser.” He has some advice for young people just entering the industry. “The best attribute anyone in business can have is to be flexible and adaptive to change,” Martin says. “Business and the automotive industry are always evolving, technology drives change, and business environments evolve into new markets or market opportunities. “In the near future we will be riding in autonomous cars. These new vehicles will completely change the automotive market.” Martin has a daughter, Deidra Martin Fricke, a son-in-law Aaron Fricke; and a son, Devin Martin. Where does he see himself in 20 years? “Retired, aggravating my children, enjoying my grandchildren and playing golf.”

owner to expand and create new jobs. Protecting family businesses from the estate tax is important in order to keep these businesses operating for future generations. We’ve been very active lobbying on this. The bill currently has 101 co-sponsors in the House. But we think the holdup on pushing it for a vote has been that we are now looking at putting repealing the death tax into broader tax reform

New OSHA requirements or fines concerning work-related injuries and illnesses Fines are always a big issue we’re hearing about. In the past, the Occupational Safety and Health Administration (OSHA) would come in for an inspection and give you 30 days to fix something before they fined you. Now they’re coming in and giving huge fines for very small things, such as extension cords being in the wrong place, having a radio on the wrong bench, things like that. Last year, OSHA did over 40,000 inspections. I know President Trump has gone after a lot of these agencies, and I think this year they’ve got their hands tied a little more than they have in the past, but it’s still definitely an issue we’re talking about with our members. When we go to state conventions, this has been another hot issue this year. At one meeting in South Carolina there were 42 dealers in the room, and they were talking about this. Twenty-six of the 42 had an inspection in the last year and they were fined somewhere between $10,000 and $35,000 for inconsequential things, whereas in the past OSHA used to say, “Fix it up; we’ll be back in two weeks. If you’ve fixed the problem, we won’t fine you.” We’ve had a lot of issues this year with the OSHA inspections, and Internal Revenue Service (IRS) inspections on wages and hours, on payroll taxes, and on imported casings for retreads. Infrastructure funding — the Highway Trust Fund and the Federal-Aid Highway Bill We could write a book on this one. The government raised a trillion dollars for infrastructure spending. One of many issues is that infrastructure involves everything, not just highways. It involves — on the transportation side — ports, airports, subway systems, mass transit, etc. It also involves water, electric grids, everything. So all the money raised is not going to strictly highway projects. This has been an issue for a long time. As an example, TIA is based in Maryland and of every dollar raised for the highways, 68 cents now goes to non-highway projects. Where does the aforementioned trillion dollars come from? Right now there are 38 or 39 proposals in Congress. There is a White House proposal we had a briefing on, which is totally different than any of the ones in Congress. Issues in it that have concern to us are whether or not you’d put a federal excise tax back on passenger tires, what you’re going to do with truck tires. The proposals commonly seen on the Hill would raise that tax by 10%. It would raise the taxes on trucks and truck parts by 10%. That’s a general trend. Whatever you do on retreads, that’s going to be a huge issue for retreaders who are already under the gun for tariff issues. But when you’re putting pieces together like a jigsaw puzzle,

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TIA president you want to look at the puzzle pieces that have the least resistance. There are fewer than 800 retreaders. There’s tens of thousands of other entities that are being looked at. It makes it difficult for groups like retreaders, and that’s why we’re there fighting for it, obviously. But there are 39 proposals and very little leadership on this one. So everybody wants to get a new highway bill. We’re just not sure how this is going to play out. Passenger, truck and OTR tire tariffs Tariffs are a very tricky issue for us. In the past, we have been for free trade. So in the past, we opposed tariffs. Our industry is a global industry. Some companies have facilities in places like China and India and they want to bring those tires in. We have commercial dealers who like to have a lower-priced option for selling without the tariffs, so tariff legislation is very difficult for us. We’ve almost had to come to a position of neutrality, but we are working with different groups in the sectors like retreaders. We bring them in and make sure their positions are known and heard. There are 777 retreaders left in the country now. Seven hundred are members. We’re very concerned about what the tariffs mean to them. Legislation concerning minimum wage Everywhere — cities, counties and states — are looking at that magic number of $15 an hour minimum wage. What happens is it’s really hard to get some kind of a jump that big on a federal level. It’s hard to get something that big on a state level. So what you’re seeing is more and more counties coming in and passing it, which makes it difficult for small businessmen who are on county lines. He’s got to pay this, and the guy next door doesn’t. I think you’re going to find most of our members don’t pay minimum wage, but when the minimum wage goes up, everything goes up. It’s difficult. The interesting thing in all of this is it’s usually big businesses supporting it, for a lot of reasons. They’re paying above that anyway. But it’s tough on a small dealership, a small repair shop that is holding on by its fingertips. Work Opportunity Tax Credit (WOTC) and the VOW to Hire Heroes Act This is a tax credit for employers who hire people from disadvantaged groups. They can get a tax break of 25%, up

GIANT INVENTORY! 86

to 40% of the employee’s salary in the first year. So you help provide jobs for veterans, people from disadvantaged groups, whether they’re former convicts or disabled, etc. It’s something we’ve always supported in the past. We’d love to see it become permanent. We keep trying, every time it comes up for a vote. We’ve been successful in getting it extended. A few years ago we were successful in an effort to add a category for veterans. We’re trying to do something similar right now for businesses in Puerto Rico and Houston. So it’s an ongoing issue, and with all of the budget bills going through right now, we’re trying to get things attached to those. Motor Vehicle Owners’ Right to Repair Act As you know, we were very involved in that on the state and federal levels. It did pass in Massachusetts. So we think that opened up the door. It’s pretty hard to have that legislation passed in one state and not have it go nationwide. We’ve been working in a coalition, trying to work with the manufacturers to roll it out. It’s a long struggle. The domestic manufacturers have been more receptive than the foreign manufacturers. But it’s an issue we’re continuing to work on. The act would: • require vehicle manufacturers to provide the same service information and tools capabilities to independent shops that they offer to their authorized dealer network to repair and maintain late model computer-controlled vehicle systems; • restore the right of vehicle owners to have their vehicles serviced and maintained at the repair facility of their choice; and, • authorize the Federal Trade Commission (FTC) to enforce requirements in order to protect consumers and to promote competition in auto maintenance and repair.

It would not:

• affect warranty work that is normally performed by the vehicle manufacturer-authorized repair facility; nor, • require manufacturers to disclose manufacturing processes or trade secrets unless that information is made available to the authorized repair facility.

When you have a change of administration from one party to another, it opens up a different set of laws you can go after. As examples, you could not have gone after the repeal of the estate tax under a Democratic Congress, and there’s going to be a lot of tax and workplace issues coming up. It’s going to be a very busy next few years, and that’s why TIA is going to have a lobby day next spring. The last one TIA had was in 2016. We encourage TIA members to come and see how the system works. TIA’s philosophy is Text Pics to 951-RimText that our members are the experts and (951-746-8398) no one can tell their stories as well as they can. It is TIA’s job is to plug our members’ expertise into the right places at the right time. ■

MTD November 2017

The Future in Motion

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feature

Keeping the course for success Outgoing President Tom Formanek says execs are ‘in unison on where TIA needs to go’ By Lori L. Mavrigian

t the Tire Industry Association’s Global Tire Expo in Las Vegas, Tom Formanek will end his turn as TIA president, handing the reins to David Martin, category director of tools and supply for American Tire Distributors Inc. (see article on page 80). When he took over the top spot at TIA, Formanek, regional sales manager for Stellar Industries Inc., told MTD he planned to “keep the course” at the association. Formanek feels he has accomplished that goal while helping to strengthen the bond between TIA and the U.S. Tire Manufacturers Association (USTMA), increasing membership numbers and making TIA stronger financially. He has a long history with the association. He joined in 1991 and held numerous positions over the years. He was elected treasurer in 2008 and held that office for six years. He was TIA secretary in 2015 and vice president in 2016. Here he reflects on his year as president.

MTD: What assistance and advice did outgoing President Glen Nicholson give you once he handed over the gavel? As a member of TIA executive committee for eight years prior to becoming president (six years as treasurer), I acquired the knowledge of what the role as president consisted of so there were few surprises upon receiving the gavel. For the past few years, all the incoming presidents agreed we need to keep the course of the association and not impose our personal agenda, thus keeping the same course for success.

More free time for TIA Past President Tom Formanek may mean he will be able to accept more auctioneer gigs. He especially enjoys auctioneering for charity events.

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TIA outgoing president MTD: What advances in TIA’s government affairs are you most proud of now that your term is ending? I feel the close working relationship with the USTMA is the best it’s ever been. Both associations have met numerous times this year and are working jointly on a couple of tire-related issues. MTD: How did your experience as a sales manager for Stellar Industries help you in your presidency? With any leader, you need to listen to what your customers’/members’ needs are and try to find solutions. This is no different in the business sector — you listen to your customers and help find solutions to their needs.

MTD: How much time did the role of president take up for you, and what is the most worthwhile project you worked on? There is not a set time that the role of president takes up. A lot of it depends on the particular week and what responsibilities arise. You may have a speaking engagement for a meeting with tire manufacturers or conference calls with fellow board members. The most memorable moments include the manufacturer meeting, which I personally enjoyed, along with meetings with members at state associations. The TIA staff is second-to-none and I am fortunate to have had all their support and help.

Formanek and his wife, Brenda, have MTD: As incoming president, you Tom three children and live in Garner, Iowa. were planning on holding the course MTD: Now that your year is over, set by TIA’s previous President Glen Nicholson and others. what do you feel your legacy will be? Were you able to do that? I hope my legacy is that I continued to hold the course of a very successful association. I was elected treasurer of TIA nine years ago. At that time we had approximately 3,000 members and we were not in a very good financial position. I can proudly exit my role as president with an association that has over 10,000 members and is in the best financial position of its existence.

‘I can proudly exit my role as president with an association that has 10,000 members and is in the best financial position of its existence.’

As with TIA Past President Glen Nicholson, myself, and soon to be President David Martin and then John Evankovich (vice president) and Treasurer Mike Wolfe, we are all in unison on where TIA needs to go. We are elected by our peers to serve the interests of the members of the association — and not to impose our personal or professional beliefs on the association.

MTD: What advice do you have for David Martin? David will do a great job. As mentioned, we are all in unison and believe we need to do what is best for our members and for the association.

MTD: If you have any spare time now that your role as president has ended, what do you hope to do with it? I always seem to find things to keep me busy. I enjoy charity work and working with nonprofit organizations, and I will continue to do this. When you own a farm, there are always things to do, and auctioneering opportunities always seem to find me. ■

MTD November 2017

Counter intelligence

Points of presentation It’s all about power, perception and persuasion

When an industry presents products such as t always helps to close a sale when a customer tires, we must remember that many customers has gained understanding, and the customer are tire agnostic; they don’t really understand is only going to understand if they are the tires. Because customers don’t understand tires, recipient of a well-executed presentation. To the differences and nuances, their perception of deliver a well-executed, customer-satisfying our representation is askew; it’s not straight. In presentation requires that we understand how others words, they hear what we’re saying, but a customer hears, processes and comprehends they often don’t understand. A well-executed information. Presentations matter. When looking up the word “presentation” and timely presentation not only helps close the in the dictionary, the ancillary words used to By Wayne Williams sale today, but sets the table for additional related describe, aid and support the “act of presenting” sales both today and in the future. are very interesting, words like “power,” “perception,” “persuasive” and “cognition.” The point of this article is First impressions matter presentation matters, especially product presentation and Let’s talk about two different and very important points product representation. of presentation along the pathway to purchase. First impressions are now made online through your website. How you present your products and your company online matters. Secondly, presentations at your location matter, in the showroom and at the sales counter. It’s been said that first impressions matter and, of course, they do. You only get one chance to make a first impression; however, I’d like to suggest that the closer a customer gets to the purchase point (usually in your store), the greater the importance of the presentation. If you have been nurturing a customer across the pathway to purchase, and they finally arrive at your location, this is the worst place to lose the sale due to a poor presentation. A good, basic presentation is first and foremost a presentation that leads to a sale. There are plenty of opportunities to improve on a good, basic presentation that differentiates the best retailers from the rest. Remember, we are retailers.

If you don’t have a picture of a product, don’t present it. If you’re not prepared to make a proper presentation, then don’t. Additionally, this space is overcrowded with too much promotional information (such as go kart tickets).

This second website presentation has plenty of wide open space for helpful information but supplies information such as 88H / SL / BSW / ITEM # 28821. I’m not sure how helpful this is the customer. The correct information, well-presented, can help a customer choose the correct product.

Proof positive — or not Note the photos of three online product presentations. If you look at these three and consider the words “power,”

The third sample here uses the best-looking image and the best consumer-friendly copy; features the best organization of information in the space; and uses modern, colorful icons and several bullet points. It’s the best-looking presentation and presentation matters, not because I say so, but because it helps consumers process information and make decisions.

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“perception” and “persuasion” in light of how the human mind receives information, then it’s obvious which image and presentation makes for the best representation and is most likely to persuade a customer along the pathway to purchase. The “No Image” is certainly a poor presentation, but consider presenting 127 options to an agnostic consumer. The average presentation is less than satisfactory because it basically serves up industry data with little information that is helpful for consumers. The third presentation looks fresh and reads well; the language is much more consumer friendly.

following day I witnessed a counter person that bypassed the lift-and-twist method and simply spoke words into the air filled with features, benefits and near meaningless recommendations. I’m sure he later complained about the internet and business conditions. We’ll look more into presentations in upcoming columns. ■

Wayne Williams is president of ExSell Marketing Inc., a “counter intelligence” firm based in La Habra, Calif. He can be reached at exsellmkting@gmail.com.

The lift-and-twist method The next critical point of presentation is your showroom floor. Again, the closer the customer is to the final purchase decision, the more important the presentation. Last week while doing a research survey in a brick-and-mortar 4WD store, I witnessed the now famous liftand-twist digital monitor presentation. During my research, I met an eager counter sales person who was happy to recommend three good options for my lifted Chevy Silverado. He dug into his system and furiously assaulted his keyboard to find three recognized brands to recommend. After he had these tires pulled up on his screen, he grabbed the monitor off the desk and lifted it to the top of the sales counter. He then twisted it around for me to view and began enthusiastically toggling back and forth from screen to screen showing me my best choices. The images were about 2.5-inch squares on the screen. Picture this: The cables prohibited him from placing the monitor in a good viewing position, so the monitor straddled the counter; I’m six-foot tall, and the top of the counter was almost nipples high. The counter person was using the only system provided him by ownership/management. As I drove away, I was thinking they could have displayed the three choices mounted on black, off-road wheels near the counter. I realize that’s an investment, but that company sells a lot of these types of products. If you’re currently using the lift-andtwist method for presentations, there are other options to consider; rotating bases is one. When the words “lift and twist” are used with words like “presentation,” “perception” and “persuasion,” you can understand the mismatch. The

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European notebook

Saturation point danger for tire shows in Europe How will ‘Tire Fair Season’ pan out in 2018?

ith the Specialty Equipment Market Association (SEMA) Show due to take place this month in Las Vegas, which has to be one of (if not the) largest of its kind in the world, I thought it was the perfect time to take a step back and get an overall picture of what is currently happening in the tire show arena in Europe. Quite simply the best way to describe this highly busy sector of the market would be — chaotic! By John Stone Throughout Europe (including the UK) so far this year, there have been at least seven major events in different countries, and that doesn’t include other smaller, more regional shows that tend to concentrate on local markets. The leading shows for all aspects of the industry (including tire dealers) continue to be the Reifen Show in Germany

Traditionally in Europe, the biennial Reifen Show in Essen, Germany, has always been considered “the” prime event for the tire market, but now it is going to be directly challenged by Tire Cologne, with both shows competing for attendees and exhibitors in 2018. An all new Reifen Show will now be staged in Frankfurt, Germany, in September, while Tire Cologne will take place in May. So European tire dealers and wholesaler/distributors now face the confusing

prospect of deciding whether to exhibit or at least visit two major European tire shows in the space of just five months. Do I think that the industry as a whole will support both shows? No, not really! I believe that at least some tire companies already are actively looking at the option of deciding which show to European tire shows are reaching a crisis point! Here we have Germany’s Reiffen Essen attend, either as an exhibitor trade show, the Autopromotec in Itally and the Tire Technology Expo in Germany. or visitor, because to visit both events may not be financially and Autopromotec in Italy, plus there is the increasingly logical. Attending a major show can be extremely expensive, growing Automechanika show series, which has venues so going to two events so close to one another may not around Europe. However, just to make the situation even appear to be a sensible option to them. more interesting, next May there will be the debut of Tire Also, the Automechanika show series continues to gather Cologne in Germany. momentum. Having launched in the UK this year in May, At the same time let’s not forget about the internationally it proved to be highly successful and significantly added to famous Geneva Motor Show in Switzerland. Although the event’s increasing popularity with its other shows in primarily all about new cars, the event additionally incor- Europe. In fact, the success of Automechanika UK as well porates booths by all the leading global tire manufacturers. as the Commercial Vehicle (CV) Show, I believe, are the And don’t forget about Tire Technology in Germany. So main reasons why a further, third major tire show for the basically there are six large and extensive shows all vying UK in October failed to take place. Tyrexpo UK, as the for the industry’s support and attention. next stage in the Tyrexpo series in Asia, India and South

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Africa, was canceled several months ago because of lack of support, as the UK market just could not accommodate yet another high profile event. Taking everything into consideration, tire shows in Europe seem to be becoming more of a headache than a pleasure these days judging by the comments I have received from various people in the industry, such as, “We obviously want to promote

our tires at such events, but the cost of exhibiting is so high that it really isn’t feasible to support more than one, possibly two shows each year.” Or, “The situation with tire shows is becoming impossible as apart from the cost, there just isn’t time to attend so many events.” I feel that these comments just highlight the mood of increasing frustration in the European industry concerning the competitive edge now developing in tire shows with, as they say, “Too many cooks spoil the broth.” Finally, there is one other point that needs to be addressed: Is “tire show roundabout” in Europe as effective as it used to be in attracting new business sales and partnerships for the future? I have noted that some of the exhibitors and visitors with whom I have spoken and interviewed at some of the recent events believe that a lot of walking and talking at the events can sometimes lead to very little profitability. Obviously, tire shows will always be a popular meeting point for companies to discuss future business plans with existing and potentially new customers all under one roof. However, I just wonder how the “Tire Fair Season” will pan out in 2018, and I will certainly be keeping a close eye on developments. ■

John Stone has been working within the global tire industry for the past 26 years. In 2004 he launched his own consulting company, Sapphire Media Services, which caters to business media clients around the globe. Stone also writes for tire and automotive-related publications in Europe, South Africa and Asia.

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Business insight

Creating standards to live by It’s all about the process, predictability, and making it easy for the customer

hen you get a chance, if you don’t already watch, check out any of Gordon Ramsey’s TV shows. From “Hells’ Kitchen” to “Kitchen Nightmares” to “Master Chef,” there is one common theme: consistency through standards. I can’t publish most comments that come out of Ramsey’s mouth, for he does tend to be “colorful” and speak his mind, but in between bleeps and blurred out middle fingers, the man is passionate about standards.

By Dennis McCarron

Customer: “No, I just want a plain oil change... you know... cheap.” Shop employee: “Sure, I can offer you our least expensive oil change. Every oil change we do consists of a quick test drive around the parking lot, a courtesy inspection of fluids and filters, replacement of the filter, draining of the old oil, and replacing it with the manufacturer’s recommended oil type. Then we run your car for two minutes to check for leaks, and we will return your car to you in about 45 minutes.”

Exacting standards Standards are essentially promises you make to every customer. “This is what I promise to you if you purchase X product.” It’s different from a warranty, it’s different from a how-to guide. It’s a promise for the exchange of the customer’s trust. Standards are what your employees employ every single time a certain service is performed. The reason that is important? Most customers depend on predictability, especially in our industry. They generally don’t understand how a car works, or why things cost as much as they do, so they need a lot of consistency — things that keep them from freaking out and starting to imagine all the crazy things they sometimes believe might be happening when you put their car nine feet in the air. Let’s break down a particular scenario to see how it works:

Customer: “How much for an oil change?” Shop employee: “$59.99. I saw you drive in the silver car, right?” Customer: “$59.99 for an oil change?” Shop employee: “Yes, your car takes X oil and capacity Y quarts, blah, blah, blah...” Customer: “Zzzzzz. I just got an oil change on my spouse’s car and it was only $39.99.” And let the fighting begin. We can be as informational as possible, but if the customer isn’t listening, because they are wondering why the change in price is so stark, then why bother talking? Let’s look at implementing some standards, in how we communicate, and see how the scenario changes. Customer: “How much for an oil change?” Shop employee offering the standard responses: 1) He will ask customers if they have been there before, and if not, what kind of car they drive. 2) He will ask every new customer if they are aware of the different kinds of oil changes you offer. “I see that you haven’t been to our location before, are you aware of the three oil change options we offer?”

Wait, wait, wait... who in the name of Harvey Firestone is going to go through all of that? It takes too long. It’s just an oil change! Yes, it is just an oil change, and yes, that conversation takes three minutes. You could rush through it and get the keys, scramble to get the car in, open the hood... and get loudly asked, “Why are you checking my tires? Why is that thing out of my car? Where did that (air filter) even come from?” When we talk about standards, we talk about process, predictability, and making it easy for the customer. Sure, it may take a few minutes in the beginning, but those few minutes save us many minutes and avoid arguments.

Standards equal consistency Standards also tell our employees what is expected of them. Many times, a shop assumes a technician knows how to do a brake job, but is there anything in writing telling them what’s expected? This is where standards shine. Gordon Ramsey may be foul-mouthed, but he’s never put someone in a position to do a job where he hasn’t explicitly (in more than one way) told them how and what to do. When he gets angry, it’s usually because the person had agreed to do something a certain way and then did not meet expectations. Standards are teachable. They are guides for employees. Not only do customers want predictability in their tire and automotive service, but so do employees. Here’s a tip: Instead of trying to come up with standards for every job your shop performs, pick a handful to start. Oil change, tire replacement, brake job. Start simple. Include your employees. You’ll be surprised how eager they are to outline the expectations of a certain job. And you will find, like Gordon Ramsey, you won’t need to be saying things like “%*&$ing s#!t d$%n&t!” ■ Dennis McCarron is executive director of Dealer Strategic Planning Inc., a company that manages multiple tire dealer 20 Groups in the U.S. (www.dsp-20group.com). To contact McCarron, email him at dennis@dsp-20group.com.

MTD November 2017

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Focus on industry

Made in America Get ready for the Giti and GT Radial brands By Bob Ulrich

iti Tire (USA) Ltd.’s new consumer tire plant in Richburg, S.C., will not officially hold a grand opening until next year. It is also two years away from reaching its full capacity of 5 million tires annually. But the facility is already producing Dextero tires for Wal-Mart Stores Inc. And beginning in the fourth quarter, it also will be manufacturing GT Radial tires for independent tire dealers. In support of Walmart’s America at Work initiative, Giti (pronounced “GT”) and Walmart held a pre-opening celebration at the tire plant on Oct. 4, 2017. Their U.S. partnership goes back to 2012, when the Giti

The plant is located on 1,600 acres in Chester County, S.C. “We have the ability to double this building very easily,” says Hank Eisenga, vice president of manufacturing.

‘New’ brand in 2018 Giti will introduce the Giti brand into the North American market in the second half of 2018, says John Aben, senior vice president of OE and consumer sales. Already a successful brand globally, Giti tires designed for the domestic market will be produced in South Carolina. Where Giti will be positioned versus the GT Radial brand in the U.S. has yet to be determined. “We’re still talking about it as a company, even though it will be OE on Volkswagen in 2019,” says Aben. “We are in a good position because we have so many options,” says Julianto Djajadi, executive vice president for business operations in North America. “The market is probably changing faster than ever before, and we have to look at many factors and... considerations.” Djajadi says the team is talking with customers and some of its key stakeholders, “and based on their input then we’ll make and plot our next move.” Earlier this year, the company announced the Giti ComfortA1 all-season tire will be original equipment on the 2019 Volkswagen Passat, which will be manufactured in Chattanooga, Tenn.

Plant details

South Carolina Governor Henry McMaster signs a green tire he made in the new Giti tire plant.

Tire Group began providing Walmart with the Dextero DHT2, an opening price point all-season tire made in Indonesia. The Dextero Touring DTR1 tire came along in 2016. Giti also has partnered with Walmart in Brazil, Canada and China. By the end of the year, the Giti Manufacturing (USA) Ltd. facility will have manufactured at least 200,000 Dextero-brand tires for Walmart. Eventually, 100% of Walmart’s Dextero tires will be produced by Giti in the U.S.

The state-of-the-art, 1.6 million-square-foot tire manufacturing plant will cost more than $560 million. It includes a separate building for testing next to the plant. “We’re putting automation in this plant that’s a higher level of automation than any other facility we have in our footprint,” says Hank Eisenga, vice president of manufacturing. “We’re doing that in a way where we can target specific areas for automation but still keep the human element in other areas.” Giti’s four-year-old R&D Center in Uniontown, Ohio, will be moved to South Carolina. “Our mission is to really tune the product that we are selling to the requirements of the customers and consumers who are going to be using these products here,” says Hamid Aboutorabi, director of the R&D Center. “And who is better (qualified to) understand those needs than engineers who have worked on tire development in this market?” ■

MTD November 2017

Focus on dealers

Matt King (left, pictured with Reggie Goodwin, manager of the 100th store) started with RNR as a tire technician. He is now a regional manager.

From wheels to tires RNR Tire Express reaches 100 stores and changes its name By Bob Ulrich

urricanes directly affected a number of RNR Tire Express outlets in September, whether they were existing stores or under construction. That includes the recently opened 100th store, located in Sarasota, Fla. But they were back up and running within a couple of weeks, so it’s time to give the milestone store its due. It is one of 15 company-owned stores; the other 85, under the direction of SPF Mgt. Co. LLC, are franchise operations. The brand started out as Rent-N-Roll Custom Wheels and Performance Tires in 2000, with wheels getting the top billing. Seventeen years later, the name has evolved into RNR Tire Express. “We believe the future is tires,” says Larry Sutton, the company’s founder and president.

History repeats itself Larry Sutton previously owned Champion TV and Appliance Rentals, which was his first rent-to-own business. Selling the business in 1997 did not dampen his entrepreneurial spirit, however.

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So he started fresh with Rent-N- Roll Custom Wheels and Performance Tires three years later. “We started out in the wheel business, not the tire business,” says Sutton. “At the time, aftermarket wheels were a $1 billion market and growing exponentially. “Custom wheels were prominent in urban songs and culture. The only reason we sold tires was because they were needed for the upsized wheels.” When Vince Ficarrotta, a former employee of Sutton at Champion TV and Appliance Rentals, came on board two years later, the wheel industry was still on the upswing. “When we started with the wheel model, that was the time when the industry was going through significant growth,” says Ficarrotta, vice president of franchising. He is also the “F” in SPF Mgt. Co., which stands for Sutton (Larry), Petco (Linda) and Ficarrotta. “It just kept growing through the next five to seven years. We kept riding the waves.” He was put in charge of franchising the new rent-to-own concept. Mike Kent, who had been influential in convincing Sutton to start franchising Rent-N-Roll, was the first franchisee.

MTD November 2017

www.RNRFranchise.com

► $1,954,745 ► $471,437 2016 AVG. ANNUAL TOTAL REVENUE*

2016 AVG. ANNUAL OPERATING INCOME*

BUILDING SOMETHING GREAT We opened the doors to our first location in Tampa, FL back in October 2000. With over 100 locations nationwide, RNR has become the go to place for wheels and tires with a variety of payment options. RNR is the only place to get the wheels you want and the tires you need with easy payment plans. Call us if you want to be a part of the best tire and wheel concept in America!

Contact: VINCE FICARROTTA at

800.449.8744 or Vince@RNRTires.com

*Figures above reflect averages for the 20 top performing stores (33%) of the 61 stores reporting that opened in 2014 or prior and have been open at least 24 months. These averages are based on a 52-week annual period from January 1, 2016 through December 31, 2016. Of these 20 stores, 10 (50%) had higher total revenue and 10 (50%) had higher operating income. A new franchise owner’s results may differ from the presented performance. There is no assurance you’ll do as well. If you rely upon our figures you must accept the risk of not doing as well. ©RNR Tire Express. All rights reserved.

Focus on dealers

RNR Tire Express founder and President Larry Sutton (right, with Randy Cabrera III) is very involved in everyday operations, including planning, training and vendor relations. The company has a comprehensive training program called RNR University, which combines digital and onsite learning opportunities that are tracked and measured.

The name game There have been three different changes to the brand name over the years. The original Rent-N-Roll Custom Wheels and Performance Tires transitioned into RNR Custom Wheels and Tires. The focus on wheels began to change in 2008 during the Great Recession when the tuner craze and the custom wheel boom leveled out. “It became very obvious if we were going to survive, we were going to have to find a way to penetrate the passenger tire business,” says Ficarrotta. Eventually the brand evolved into RNR Tire Express, which markets all major brand name tires with a strong focus on brands such as Nexen, Yokohama, Toyo and several others.

Interestingly, RNR Tire Express continues selling as many custom wheels as ever; however, they have grown their volume by adding focus on passenger tires. “Whenever possible, we use economies of scale to get the best price,” says Sutton. “We do act as a buying group in many instances.” Although all the stores operate similarly, the franchisees have some freedom to meet the needs of their customers in their areas. For example, the brands they offer can vary by region, dependent on distribution channels. “We’re not a typical do-as-we-say franchisor,” says Sutton. “We believe in entrepreneurship and have created a culture where everyone’s voice and ideas are heard.” All the stores offer guaranteed low prices on all their products.

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Puncture Guard Toughness. Three tough layers of polyester cord fabric and high strength steel belts guard against rock and debris punctures. Super Stable Shoulder. The varying shapes of the shoulder blocks are optimized for improved handling and control on unpaved roads. Wetland Optimized Grooves. Angled lateral and longitudinal groove structure promotes better drainage for improved braking and handling on wet, soggy ground.

High Stability Tread Corners. The special cutting corner on all borders of the groove pattern makes it more dimensional while promoting driving stability and comfort. Zig-Zag Middle Block. The zig-zag middle tread pattern reduces noise while the sloped corner repels rocks and improves earthgrasping performance. Special Shoulder Shape. The bench-shaped shoulder design provides excellent earthgrasping action for stable high-speed turns under dry and wet road conditions.

Noise-Reducing Shoulder. The closed shoulder design blocks noise from the middle of the tires for a quieter, more comfortable ride. Optimal Middle Pattern. The consistent middle pattern and uninterrupted closed shoulder design improves stability. Longitudinal Traction Grooves. The longitudinal groove design is optimized for effective drainage, faster braking, improved acceleration and stable turning on wet terrain.

Focus on dealers “We will beat any local competitor’s price with a written quote,” says Sutton. “And we include free installation.” If the tires are rented and returned, the company’s policy depends on the condition of the tire. “If they have an adequate amount of tread, we will re-sell them at a discounted price,” says Sutton. “If not, we dispose of them.” The cost of becoming an RNR Tire Express franchisee is $35,000. The franchise fee per store drops as a franchisee becomes a multiple store owner.

1 store: $35,000 2-3 stores: $30,000 4-11 stores: $20,000 12-over: $3,750

3 franchisees, 51 stores RNR Tire Express is the nameplate on 100 stores, 85 of them franchises. Three of the franchisees account for more than half of the total outlets. 1. Rental Concepts LLC, dba RNR Tire Express, Fayetteville, Ark., David Harrison, president (21). 2. Rims USA LLC, dba RNR Tire Express, Spartanburg, S.C., Chris Raffo, owner (18). 3. Gulf Coast L&P Inc., dba RNR Tire Express, Moss Point, Miss., Shannon Strunk, owner (12). The fourth largest franchisee, RNR of Virginia LLC, dba RNR Tire Express, is run by Richard Rose, a coowner of eight RNR outlets. They are based out of Norfolk, Va.

There is also a royalty fee per store: 5% of total revenue.

Corporate vs. independent The corporate stores are important to the growth of the company, says Ficarrotta. “Our corporate stores allow us to beta test various concepts and develop rich training programs. It keeps us at the forefront of what our franchisees are going through because we experience it ourselves.”

In addition to corporate stores, RNR Tire Express partners with 20 different franchisees. It operates in 22 states. “Between now and the end of 2017, we are anticipating 15 store openings, with another eight slated for the first quarter of 2018,” says Sutton. “We are excited to bring our quality service and affordable payment options to hundreds of new markets over the next several years.” ■

STATEMENT OF OWNERSHIP, MANAGEMENT AND CIRCULATION (Required by 39 U.S.C. 3685) PUBLICATION TITLE MODERN TIRE DEALER

PUBLICATION NO. 0026-8496

FILING DATE 10/1/2017

ISSUE FREQUENCY Monthly

NO. OF ISSUES PUBLISHED ANNUALLY 12

ANNUAL SUBSCRIPTION PRICE $65.00 per year

COMPLETE MAILING ADDRESS OF KNOWN OFFICE OF PUBLICATION Bobit Business Media, 3520 Challenger Street, Torrance, CA 90503-1640, Los Angeles County COMPLETE MAILING ADDRESS OF PUBLISHER’S HEADQUARTER’S Bobit Business Media, 3520 Challenger Street, Torrance, CA 90503-1640, Los Angeles County FULL NAMES AND COMPLETE MAILING ADDRESSES OF PUBLISHER, EDITOR, AND MANAGING EDITOR PUBLISHER: Greg Smith, Bobit Business Media, 3520 Challenger Street, Torrance, CA 90503-1640, Los Angeles County EDITOR: Robert Ulrich, Bobit Business Media, 3520 Challenger Street, Torrance, CA 90503-1640, Los Angeles County MANAGING EDITOR: Lori Mavrigian, Bobit Business Media, 3520 Challenger Street, Torrance, CA 90503-1640, Los Angeles County OWNER Ty F. Bobit, CEO

COMPLETE MAILING ADDRESS Bobit Business Media, 3520 Challenger Street, Torrance, CA 90503-1640, Los Angeles County

KNOWN BONDHOLDERS, MORTGAGEES, AND OTHER SECURITY HOLDERS OWNING OR HOLDING 1 PERCENT OR MORE OF TOTAL AMOUNT OF BONDS, MORTGAGES, OR OTHER SECURITIES None ISSUE DATE FOR CIRCULATION DATA BELOW August 2017

EXTENT AND NATURE OF CIRCULATION

AVERAGE NO. COPIES EACH ISSUE DURING LAST 12 MONTHS

ACTUAL NO. COPIES OF RECENT SINGLE ISSUE

15a TOTAL NO. COPIES (NET PRESS RUN) 15b PAID/REQUESTED CIRCULATION 15b.1 OUTSIDE COUNTY PAID/REQUESTED MAIL SUBSCRIPTIONS 15b.2 IN-COUNTY PAID/REQUESTED MAIL SUBSCRIPTION 15b.3 SALES THROUGH DEALERS/CARRIERS 15b.4 REQUESTED COPIES USPS OTHER MAIL CLASSES 15c TOTAL PAID/REQUESTED CIRCULATION

36,557 0 30,236 0 0 1,105 31,340

36,115 0 33,194 0 0 1,085 34,279

15d NONREQUESTED CIRCULATION 15d.1 OUTSIDE COUNTY NONREQUESTED COPIES 15d.2 IN-COUNTY NONREQUESTED COPIES 15d.3 NONREQUESTED DISTRIBUTED BY OTHER CLASS OF MAIL 15d.4 NONREQUESTED OUTSIDE USPS 15e TOTAL NONREQUESTED DISTRIBUTION

0 2,048 0 0 253 2,301

0 1,613 0 0 34 1,647

33,641 234 33,874 93.2%

35,926 208 36,134 95.4%

15f TOTAL DISTRIBUTION 15g COPIES NOT DISTRIBUTED 15h TOTAL 15i PERCENT PAID/REQUESTED CIRCULATION 16 ELECTRONIC COPY CIRCULATION 16a REQUESTED AND PAID ELECTRONIC COPIES 16b TOTAL REQUESTED AND PAID PRINT COPIES + REQUESTED/PAID ELECTRONIC COPIES 16c TOTAL REQUESTED COPY DISTRIBUTION + REQUESTED/PAID ELECTRONIC COPIES 16d PERCENT PAID AND/OR REQUESTED CIRCULATION (BOTH PRINT & ELECTRONIC COPES)

31,340

34,279

33,641

35,926

93.2%

95.4%

This Statement of Ownership will be printed in the November 2017 issue of this publication. I CERTIFY THAT ALL INFORMATION FURNISHED ON THIS FORM IS TRUE AND COMPLETE. I UNDERSTAND THAT ANYONE WHO FURNISHES FALSE OR MISLEADING INFORMATION ON THIS FORM OR WHO OMITS MATERIAL OR INFORMATION REQUESTED ON THE FORM MAY BE SUBJECT TO CRIMINAL NS (INCLUDING FINES AND IMPRISONM SANCTIONS IMPRISONMENT) AND/OR CIVIL SANCTIONS (INCLUDING MULTIPLE DAMAGES AND CIVIL PENALTIES).

______________________________ x __________________________________________ Publisher

104

Larry Sutton’s favorite responsibilities are visiting stores, attending grand openings and meeting as many new associates and customers around the country as possible. The average inventory per RNR outlet is 100,000 tires.

Filed on 10/1/2017

MTD November 2017

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For what drives you.

Focus on industry

‘The factory is an enabler’ Nokian will focus on its tire dealer network and all-season products in North America By Joy Kopcha

irt work is underway at the future site of Nokian Tyres plc’s first North American tire factory, but the production facility is just the beginning of the company’s plans. “It’s not only the $360 million we’re spending on this, but it’s much more when thinking of building the organizational capabilities and investing in marketing and cooperation with our customers,” said Hille Korhonen, Nokian’s CEO and president. “We are not only investing in the factory, we are investing in creating a better business model in North America.” Antti-Jussi Tähtinen, vice president of marketing and communications for Nokian, said, “It’s a package. The factory

Matti Morri, known as Nokian’s “Mr. Tire,” said the all-season lineup previously featured only asymmetric patterns.

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Hille Korhonen, center, said building tires in Tennessee by 2020 is “not just a plan, it’s a commitment.” She was joined at the groundbreaking by Chairman of the Board Petteri Walldén, left, and Gov. Bill Haslam.

is an enabler. Without the factory it would be really difficult to grow.” And growing is the goal. In May when Nokian announced plans to build its third tire manufacturing facility in Dayton, Tenn., the company said it wants to double sales in North America in the next five years. Korhonen reiterated that goal during at the groundbreaking event. The path to growth may center on the factory, but execution doesn’t wait for tire production, which is set to begin in 2020. (The company will produce about 1 million passenger, SUV and light truck tires in that first year of production, and 4 million tires by 2022.) In 2018 the company will launch an authorized network of dealers in the U.S. and Canada, and it will support those tire dealers with in-store marketing and point-of-purchase displays. The help will extend outside the dealership, too, with messages that target consumers and direct them to a specific Nokian tire dealer. Tähtinen said, “We have had that in Europe for a couple years and it’s great to hear feedback from Italian customers. ‘I got people coming in, they saw your ad online and it directed them to my shop.’ That’s the kind of thing we want to do together with our dealers, guide the consumer to them.” The company believes the authorized dealer network will help it expand its footprint. In the U.S. partnering with more tire dealers is the top priority. Tommi Heinonen, head of Nokian Tyres North America, said, “We have several dedicated target areas. Of course we

MTD November 2017

want to focus first on areas where there is snow, because we can support that with our winter products.” He listed Seattle and Denver as targets, as well as Michigan. “We definitely don’t want to try to take all the states at the same time. We’ll start with more winter-oriented areas and go south.” Korhonen said Nokian will focus on

its online presence, though the company has no plans to sell tires online direct to consumers. “Our thinking is we should do that together with our dealers.” Instead, the company will focus on its visibility to consumers. “Online means much more than selling product. It means having the product visible to consumers and

the services visible in order to support the core experience of the consumer.” Then, the consumer experience feeds into the dealer support system. “We believe when the consumers are happy with the product they are telling (others) about it, and our dealer network gets confidence that we are delivering what we are promising,” Korhonen said. ■

Nokian offers a broad market tire for CUVs and SUVs 30 sizes of the eNtyre C/S will be ready in 2018 Nokian Tyres plc plans to expand its all-season product lineup as it ramps up business in North America, but it’s not waiting for its new tire production facility. The company has 11 product groups specific to the North American market, “and we will be gradually building more,” said CEO and President Hille Korhonen. During a groundbreaking event in September the company unveiled its newest tire, the eNtyre C/S. The CUV/SUV tire focuses on performance, durability and comfort, and is backed by a 65,000-mile limited tread wear warranty. The tire will be available in 30 sizes in early 2018. It’s Nokian’s first non-directional, symmetric tire designed specifically for North America, said Matti Morri, the company’s technical customer service manager. The tire’s tread pattern features four main grooves connected with lateral sipes to remove water and slush. The grooves’ high-polish finish helps to usher water away and resist hydroplaning. They also feature soft soil and snow grip enhancers which improve the grip when driving in muddy or snowy conditions. The sidewalls are reinforced with Aramid sidewall technology which provides durability and puncture resistance. The main grooves are also deeper than usual, providing for good mileage. The tire’s center rib uses variable left-right siping, which means openings switch from left to right with each sipe, allowing more sipe edges to be used. This results in better grip while maintaining a stable and responsive driving feel. The center rib also is surrounded by a special 3D-lock pattern that stiffens the blocks and allows for maximum use. The eNtyre C/S features two new innovations to reduce noise. The Silent Groove Design uses indentations like those on a golf ball on the walls of the longitudinal center rib to control air flow. The indentations cut out sounds made by the edges of the transverse grooves and prevent unpleasant howling sounds. With Silent Sidewall Technology, there’s a special zone on the sidewall of the tire that removes noise and vibration carried over from the driving surface by the tire tread. As for durability, Morri said Nokian used some of the same materials from its Rockproof tire, introduced in 2016, in the compound of the eNtyre C/S. Steve Bourassa, product director for Nokian, said the eNtyre

www.moderntiredealer.com

The eNtyre C/S tire will be available in a mix of H- and T-rated sizes for 16- to 20-inch wheels.

C/S will be a broad market tire compared to the eNtyre 2.0, and its tread wear warranty reflects that — 65,000 miles of coverage for the eNtyre C/S compared to 80,000 miles for the eNtyre 2.0. The new tire is designed for the more frugal consumer, he said, while the eNtyre 2.0 was geared toward the more professional, affluent consumer who was willing to invest more in tire performance. In the instances where there is a size overlap between the two tires, such as 225/65R17, 235/50R18 or 235/55R19, the load carrying capability and speed rating of the eNtyre C/S is slightly lower than that of the eNtyre 2.0.

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Focus on industry

BFG advances its Advantage T/A ‘powerline’ It offers one solution for drivers and dealers, says Michelin By Lori L. Mavrigian

ichelin North America Inc. is powering-up its BFGoodrich tire lines with two tires, the next generation Advantage T/A and the new Advantage T/A LT. They boost what the company is calling its “powerline,” which offers consumers all-season/all-purpose tires with advanced mileage and agile handling. The BFG Advantage T/A is for cars, CUVs and minivans, while the BFG Advantage T/A LT is for CUVs, SUVs and some light trucks. The tires fall within the BFGoodrich portfolio which also includes:

• the Mud-Terrain T/A and All-Terrain T/A KO2 for off-road performance; • the Advantage T/A LT and Advantage T/A for daily fun; and • the g-Force Comp-2 A/S and g-Force Sport Comp-2 for ultra-high performance. According to Matthew Cabe, senior country operations marketing manager for Michelin, “We are really attacking the powerline concept. What that means to us is being able to provide our dealers with options, whether it’s the Advantage T/A or the Advantage T/A LT. We don’t have any overlapping sizes; they’re very much one continuous entity.”

Advantage light truck The Advantage T/A LT has what the company describes as a “raptor claw” tread design which has earned the three peak mountain snowflake symbol for winter driving. “In tests,” says Cabe, “the tires had 30% better snow traction than the leading competitors.” The Advantage T/A LT is going to replace the company’s Long Trail T/A Tour, which is being phased out. The new tire is also 9% better in preventing hydroplaning than the Long Trail and 10% better in handling, notes Cabe. It also offers a “much more competitive warranty. We’re 60,000 miles on the V-rated tire and 65,000 miles on the T and H. “The Long Trail was getting a bit long in the tooth,” says Cabe. “We had the opportunity to take advantage of putting in some better technology than what we had before.” Both tires incorporate the company’s 3D Active Sipe and Aqua-Flume technology. Michelin also is touting the tire’s full-depth tread feature,

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The full-depth, “raptor claw” tread on the Advantage T/A LT is designed to look the same when worn as it does new, therefore retaining its performance characteristics.

which means the tread looks the same when worn as it does when new. Cabe says, “The tagline we’re using is ‘Bald isn’t always beautiful.’ We feel like we’re bringing value to the consumer and thereby value to our dealers. “They can stand by their tires and tell customers, ‘We’re providing you with something that’s top shelf. You’re getting a lot of benefits through the entire tire life, not just surface level, but full depth.’ “I feel like we’re able to bring a tire to market that’s not a one-trick pony,” Cabe says. “Some of our competitors’ tires are one dimensional. We’re bringing something to market that serves the needs of the majority of consumers, and because of the additional handling and snow performance, people can have fun with it.” Thirty-three sizes are currently available ranging from 16-inch to 20-inch. Six more sizes will be released in March 2018, including one 22-inch size: 285/45R22. “This is the evolution of the market,” Cabe points out. “This points to the growth of SUVs now and in the future. We’re looking at ahead to 2024. SUVs are going up, passenger vehicles are going down. Light trucks are stable. Currently, light trucks are the number-one and number-two-selling vehicles in the market. The Ford F-150 and Chevy Silverado own a huge share of the segment. The LT line plays well with this trend and it looks good on them.” With the addition of the two tires, the company is also phasing out:

• the previous generation Advantage T/A; • the g-Force Super Sport (H – and V-rated); and • the Touring T/A (a Sam’s Club-specific tire). ■ MTD November 2017

TPMS

Hyundai Elantra, Elantra Coupe and Elantra Touring Sensor initiation varies for automatic and manual models SUBJECT VEHICLES: 2011-2017 Hyundai Elantra, 2014 Elantra Coupe and 2009-2012 Elantra Touring. RELEARN PROCEDURE? Yes. SPECIAL TOOLS NEEDED? Yes, a Hyundai GDS (Global Diagnostic System) with the TPMS module.

be illuminated. If the fault is considered â€œcritical,â€? the light will stay on throughout the entire ignition cycle. The tire pressure sensor operates in two modes: stationary/ rolling mode and sleep mode. In the stationary/rolling mode, the sensor will measure pressure and temperature every four

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Artwork courtesy of Hyundai Motor Co.

he tire pressure monitoring system (TPMS) of the 2011-2017 Hyundai Elantra, 2014 Elantra Coupe and 2009-2012 Elantra Touring monitors the air pressure in the four road tires with wheel-mounted tire pressure sensors. To do this, the system uses a receiver, four radio frequency (RF) tire pressure sensors, two warning indicators on the instrument cluster, and a data circuit to perform system functions. When tire pressure is below the allowed threshold or a rapid leak is detected, the low pressure warning light on the instrument cluster will be illuminated. If the system detects a receiver or sensor fault, or if it detects a fault that is external to the receiver or sensor, the TPMS warning indicator will

Figure 1: Registering the tire pressure sensor (one of two).

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TPMS

Figure 2: Registering the tire pressure sensor (two of two — see the previous page for step one).

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MTD November 2017

seconds, and measure acceleration every 60 seconds. In sleep mode, the sensor enters a low current consumption state where no measurements are made in order to conserve battery power. All sensors are in this state when new. The sensor will not transmit unless requested to do so by the initiate command or when the vehicle accelerates to 20 mph (32 km/h).

Tire pressure monitor warning indicators When the low tire pressure warning light comes on the air pressure of all tires needs checked and adjusted to the specified cold pressure listed on the vehicle certification label (found on the driver’s door or door pillar). If the tire is damaged, repair as necessary. Ensure the warning light goes off (this may take up to four minutes if the tire is not rapidly re-inflated). If the warning light stays on, recheck tire pressure. If tire pressure is OK, turn the wheel a quarter turn and wait another four minutes (the sensor may be in an RF null). If the warning light is still on or if the TPMS warning indicator is lit, there is a malfunction in the TPMS.

a Hyundai GDS (Global Diagnostic System) with the TPMS module must be used. NOTE: When four sensors have been learned as road wheels, it is not possible to learn new road wheel sensors on the same ignition cycle. 1) Condition – Ignition ON and Engine OFF 2) Hold the TPMS module within 3 inches (76 mm) of the sensor valve, read each tire pressure sensor ID in the following order: front left, front right, rear left, then rear right. 3) Press the ENTER button as each tire is illuminated on the screen.

Reset procedures NOTE: If the tire pressure sensor is replaced, it will need to be initiated. The TPMS is not affected by wheel and tire rotation. When the low tire pressure warning light comes on, check the air pressure of all tires and adjust to the specified cold pressure listed on vehicle certification label (found on driver’s door or door pillar). Ensure the warning light goes off (this may take up to four minutes if the tire is not rapidly re-inflated).

Tire pressure sensor initiation (automatic) • Auto-locate/learn takes place only once per ignition cycle. On successful completion, four road wheel sensor IDs, together with their respective road wheel positions, are latched into memory for monitoring. • Until Auto-Learn completes, previously learned sensors (together with their respective locations) are monitored for under-inflation / leak warnings. • Auto-location / learning only functions when speed is more than 15 mph (20 kph). • It takes less than 10 minutes at 15 mph (20 kph).

Tire pressure sensor initiation (manual) NOTE: In the following procedure,

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TPMS 4) Press the WRITE button after reading all of the sensor IDs. 5) Connect GDS to Data Link Connector (DLC) located under the left side of the instrument panel. Register the four sensor IDs to the receiver (see Figures 1 and 2). NOTE: The TPMS receiver will complete the learn procedure of the new sensor after the vehicle is driven up to 20 minutes at speeds over 20 mph (32 km/h). NOTE: For the system to correctly monitor the tires for underinflation, there should be a total of exactly four sensors, one on each of the four road wheel positions. There should be no other sensors in the vehicle since this could cause the system to monitor the wrong sensors or fail to lean a new sensor. 6) Modify any sensor ID and press the [OK] button.

Demounting/mounting procedures CAUTION: The tire should be demounted from the wheel using the tire changer manufacturer’s instructions. Use the following information to avoid damage during the demounting/mounting procedures. Ensure that the wheel to be fitted is designed for the sensor mount. There should normally be a mark to indicate this. NOTE: If the tire pressure sensor is replaced, it will need to be initiated. See “Reset procedures.” The TPMS is not affected by wheel and tire rotation. NOTE: Tire pressure is also dependent on temperature of the tire. For every 18 degrees Fahrenheit (10 degrees Celsius) increase in tire temperature, tire pressure increases about 1.5 psi (10 kPa). Tire pressure should only be adjusted when

tires are cold (about the same as ambient air temperature). CAUTION: Do not use puncture repair fluid, as this can cause sensor pressure port to block and an incorrect warning to occur.

Removal 1) Remove the wheel and tire assembly. CAUTION: Avoid tire/tool contact with the valve while demounting the tire. 2) Deflate the tire and remove the balance weights. The tire bead should be broken about 180 degrees from the valve side of the wheel. The bead breaker should not be set too deep. Demount should end near the valve. CAUTION: The valve nut should not be re-used. 3) While handling the sensor with care, remove the valve nut. 4) Discard the valve stem assembly.

Installation CAUTION: Avoid bringing tire pressure sensor in contact with lubricant. Always handle the tire pressure sensor carefully. 1) Assemble the valve to the sensor, making sure the hex nut is in contact with the metal insert in the sensor body (see Figure 3). 2) Tighten the 7 mm nut with a nut driver to the required torque. See “Torque specifications. 3) Ensure that the valve hole and mating face of the wheel are

Figure 3: Installing the valve to the sensor.

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clean. Mount assembly to the wheel using a standard valve stem puller tool. 4) Lubricate the tire bead (not the rim). Do not use excessive lubrication. 5) Start tire mounting at about the 5 o’clock position from the valve. Move the mounting tool away from the valve. Avoid tire/tool contact with the valve. Finish with the mounting tool near the valve. 6) Adjust inflation pressure of all the wheels. Install the valve cap. 7) If installing a new sensor, initiate the tire pressure sensor. ■ Torque specifications Component Wheel nut Tire pressure sensor valve nut

Ft.-lbs. 65-79.6 In.-lbs. 35

(N.m) (88-108) (N.m) (4)

Information for this column comes from Mitchell 1’s “Tire Pressure Monitoring Systems Guide” for domestic and import vehicles. 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. For archived TPMS articles, visit www. moderntiredealer.com.

MTD November 2017

Products Sentury Tire introduces Landsail 4-Season The new Landsail 4-Seasons all-weather passenger car radial tire from Sentury Tire Americas meets the standards of the U.S. Tire Manufacturers Association for winter driving conditions. The company says the tread design, compound and depth meet higher winter performance requirements for harsh driving conditions and earned the mountain/ snowflake symbol designation. Other features include “quiet ride” pitch alignment to reduce road noise resonance and three wide longitudinal drainage grooves to channel water out from under the tire for more optimal control in rain and snow. SENTURY TIRE AMERICAS www.landsailtires.com/tires/4-seasons

Toyo introduces Proxes ST III all-season tire Toyo Tire U.S.A. Corp. has released the Proxes ST III all-season tire for sport trucks and sport utility vehicles. The company says the Proxes ST III is the perfect balance of dynamic looks and sportoriented performance. Arrowhead tapers help deliver increased tread block stiffness resulting in better straight-line stability. Directional shoulder blocks stabilize the tread blocks for better braking performance and a quieter ride. The Toyo Proxes ST III is available in V- and W-rated sizes to fit 17- to 24-inch wheels. The tire is backed by a 40,000-mile warranty. TOYO TIRE U.S.A. CORP. www.toyotires.com

New five-gas analyzer is designed to monitor engine performance The new portable F5000-5GAS exhaust analyzer from E Instruments International is designed to monitor the performance of fuel additives and engine catalysts. The gas analyzer features high accuracy NDIR (non-dispersive infrared) sensors to monitor CO, CO2 and HC gases. Electrochemical sensors measure O2 and NO/ NOx gases. The analyzer provides Lambda and AFR calculations. The F5000 includes real-time data-logging PC software with bluetooth connectivity; rechargeable, long life battery; 12-inch probe with s-type fitting and exhaust clamp; optional flexible probe tip; and optional wireless Bluetooth printer for on-site reports. E INSTRUMENTS INTERNATIONAL LLC www.e-inst.com

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New Robinair machine services standard and high-voltage systems The new Robinair AC1234-4 for R-1234yf systems from Bosch Automotive Service Solutions is designed for both standard and high-voltage A/C systems. Technicians can program the AC1234-4 for service and return when complete. Bosch says the Robinair AC1234-4 offers 98.5% recovery efficiency and precise charge accuracy to better than a half-ounce of the programmed charge amount. Features include an automatic internal tank refill and an automatic oil drain to show the amount of oil removed during service. An automatic air purge removes air accumulated in the internal tank while programmable vacuum operation quickly reaches the necessary vacuum level in nearly any condition. BOSCH AUTOMOTIVE SERVICE SOLUTIONS www.robinair.com

CRP Automotive’s new transmission fluid service kits aim to simplify service CRP Automotive has developed three service kits designed to simplify transmission fluid service on Audi, BMW and Volkswagen vehicles. The kits feature two CRP Automotive brands: Pentosin and Rein Automotive. Pentosin ATF1 is a long-life fully synthetic high performance automatic transmission fluid designed for lifetime application in automatic gearboxes. The kits include Rein Automotive OE-quality transmission fluid filters. CRP AUTOMOTIVE www.crpautomotive.com

Clore adds 12-volt jump starter to Booster Pac line Clore Automotive Inc. has added the ES580 12 volt jump starter and power supply to its Booster Pac brand product line. Clore says the ES580 is an ideal shop tool, combining robust jump starting power with numerous features that deliver utility and convenience, including preheat capability for improved performance in extreme cold temperatures, USB outlets to power small electronics, 12 volt power supply capability and a high intensity LED work light. With 700 peak amps and 330 start assist amps of starting power, the ES580 can tackle a wide variety of starting tasks, including automotive, marine, light truck, agricultural and fleet starting. CLORE AUTOMOTIVE INC. www.cloreautomotive.com

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Ad index When you contact one of our advertisers please be sure to mention you saw their ad in Modern Tire Dealer Advertiser 1-800EveryRim 31 Incorporated ACDelco Aftermarket Auto Parts Alliance Inc. ANCO ATEQ Bartec USA BKT USA Inc. Blackburn OEM Wheel Solutions CEAT Specialty Tyres Limited CIMS Inc. Cooper Tire Dealer Strategic Planning Inc. Falken Tires Federal Tire Firestone Tire Gaither Tool Company Inc. General Tire Greenball Corporation Hankook Tire America Corporation Hercules Tires/Commercial Specialty Products Hunter Engineering Company Independent Tire Dealers Group Italian Trade Agency K & M Tire Inc. Kenda Tire USA Kumho Tire USA Inc. KYB Americas Corporation Linglong Americas Inc. Marangoni Tread North America Inc. Maxxis International-USA Nexen Tire America Inc. Nitto Tire U.S.A. Inc. Nokian Tyres Inc. Omnicraft Auto Parts Pirelli Tire LLC Reliable Intâ€™l Exhibition Services Co. Ltd. RNR Tire Express Rotary Lift Schrader Performance Sensors Sentury Tire Americas Snap Finance Standard Motor Products Inc. STEELMAN Select TPMS, by JS Products Sumitomo Tire Sumitomo Tire Synchrony Financial TBC Brands Tire Profiles Tireco Inc. Toyo Tires Travel Centers of America Triangle Tire USA Vee Rubber America Inc. Wagner Lighting ZC Rubber America Inc.

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Website www.1800everyrim.com www.31inc.com www.acdelco.com www.alliance1.com www.ancowipers.com www.ateq-tpms.com www.bartecusa.com www.bkt-tires.com www.blackburnwheels.com www.ceatspecialty.com www.cimstireregistration.com www.coopertire.com www.dsp-20group.com www.falkentire.com www.federaltire.com www.firestonetire.com www.gaithertool.com www.continentaltire.com www.greenball.com www.hankooktireusa.com www.herculestires.com/specialty-commercial www.hunter.com/mtd www.itdgusa.com www.italitrade.com/usa www.kmtire.com automotive.kendatire.com www.kumhotireusa.com www.kyb.com www.linglongtire.com www.na-marangoni.com www.maxxis.com www.nexentireusa.com www.nittotire.com www.nokiantires.com/dealer www.omnicraftautoparts.com www.us.pirelli.com www.citexpo.com.cn www.rnrfranchise.com www.rotarywheelservice.com/mtd www.schraderinternational.com www.senturytireusa.com www.snapfinance.com www.standardbrand.com www.steelmanselecttpms.com www.sumitomotire.com www.sumitomotrucktires.com www.synchronybusiness.com/automotive www.tbcbrands.com www.tireprofiles.com www.tireco.com www.toyo.com www.ta-petro.com www.triangletireus.com www.veerubberus.com www.wagnerlighting.com www.arisuntires.com

MTD November 2017

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Your turn

‘If God didn’t use retreads, he will now!’ Our friend Harvey Brodsky, the voice of retreading, has died. He was 81 (see “In memoriam” on page 17). Following our posting of his obituary on our website, many readers were moved to comment. Here is a sample. Harvey not only talked the talk where retreads are concerned, but also walked the walk. He was a thoroughly decent and nice guy who I was privileged to know and who had a wealth of retreading knowledge. If God didn’t use retreads, he will now!

He was a great guy, and we will always remember him. At that time I was with Topflight Corp., a pressure sensitive label printing company in York, Pa. One time, on his way to Philadelphia, he stopped in to visit with us, and he did a walk through and spoke with our employees. He said the way a company treats its employees is evident in the way it keeps its employee restrooms. Fortunately, ours were fine, but I thought that was a great evaluation! Carolyn Jacobs, Sales Alpha Marketing Associates Bonita Springs, Fla.

Richard O’Connell, Retired Bandvulc Tyres Ltd. Ivybridge, Devon, UK

Harvey Brodsky has died. This is really sad news. He was an industry icon and one of the best industry proponents I ever encountered. If someone said one thing bad about retreads, you can bet that minutes later you would have an email rebuttal from Harvey, cc’ing the world. It is easy to say he will be missed, but he will be MISSED! Mike Antich, Editor and Associate Publisher Automotive Fleet magazine Torrance, Calif.

Bob, very well said. Harvey was just one of those people who radiated enthusiasm. In the tire industry, if you mentioned the name “Harvey,” everyone immediately knew who you were talking about — Harvey Brodsky. I think Harvey Firestone would come in a distant second! Dick Gust, President of National Account Sales, Director of Government Affairs Liberty Tire Recycling Pittsburgh, Pa.

Well done, Bob. Harvey was a good man. MTD Editor Bob Ulrich also wrote a blog entitled “Harvey Brodsky made a lasting impression on retreading, the tire industry and me.” Readers left these remarks:

George Pehanick, CEO East Bay Tire Co. Fairfield, Calif.

Harvey was a stellar advocate for our industry, but much more importantly, he was truly an excellent human being!

Harvey was a first class gentleman. Rest in peace, my friend.

Shawn Rasey, Director Global Business Development, Earthmover Tires Continental Tire the Americas LLC Fort Mill, S.C.

Well said, Bob. Harvey was a neat guy and always on duty. A real friend to the tire industry. Dave Redfern, Retired, Formerly Owner/Partner of Redwood General Tire and Former Executive Director of the California Tire Dealers Association Redwood City, Calif.

We are very sorry to hear of Harvey’s passing. I met Harvey way back, probably in l972 at the American Retreaders Association convention in Louisville, Ky., or at the Vegas tire convention. At that time he was on crutches, and flying through the exhibit hall faster than anyone who was walking through the center!

Wayne Croswell, CEO and President WECnology LLC Amherst, N.H.

He has an eye on details Dear Wayne Williams, Your article in MTD’s September issue is solid! (See “We are retailers: You must keep an eye on the details in retail.”) The length is short but it is intelligently focused. Your question toward the end is one that needs to be asked daily, Wayne. “Why would a store offer tires online that they are unlikely to offer at the counter?” Thanks for doing what you do and being a voice of sanity. Keep it up and KUDOS again, Wayne. Look forward to seeing you at the SEMA Show! Tyson Boyer, Forward Movement Ambassador Dill Air Control Products Oxford, N.C.

Join Modern Tire Dealer’s National Advisory Council Each month, Modern Tire Dealer is guided and influenced by a select group of readers — members of our National Advisory Council. These members’ opinions are the heart of the monthly Your Marketplace column, compiled by industry analyst Nick Mitchell. 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. 2211.

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MTD November 2017

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