More than just OK: O.K. Tire achieves record sales
O.K. Tire Stores Inc. is on a roll. The Langley, British Columbia-based distribution group achieved record sales for its 2002-2003 fiscal year, ended Sept. 30 -- an 11% increase over previous-year sales, also a company record.
During the past year, O.K. Tire added nearly 30 franchise members, launched its own e-commerce site, and expanded warehouse space in Calgary, Alberta, and Regina and Saskatoon, Saskatchewan. In addition, O.K. Tire, which celebrated its 50th anniversary, opened its first company-owned outlet near its hometown.
Modern Tire Dealer recently caught up with O.K. Tire Stores President and CEO Ken MacLeod to discuss the company’s success and its plans for the new year. MacLeod’s goal is “to keep the momentum going. Our hope is a 10% (sales) increase; we’re on track so far.”
MTD: To what do you credit O.K. Tire’s recent success?
MacLeod: Three years ago, the board and I took a look at our company from the inside out. We created a vision, and once we figured that out, they asked me to put a five-year plan together. We’ve developed and worked that plan. We’re not just a buying group; you can keep your independence. That’s key for a lot of our dealers.
MTD: What’s the Canadian retail tire market been like?
MacLeod: It varies by province. In major centers like Toronto, Vancouver and Montreal, there’s been an increase in performance (tire sales). We’re in the Maritimes now, which is an untapped market for us. The market that has the most potential is eastern Canada, especially Quebec. We’ve grown 25% on average in Quebec over the past three years. Ontario is improving substantially.
MTD: You’ve expanded warehouses in Alberta and Saskatchewan and plan to follow suit in Ontario and Quebec. Why?
MacLeod: The increase in our customer base. We have 238 franchise members, but we also have more than 2,000 wholesale accounts across Canada -- about 20% of our overall business.
MTD: How many franchises do you plan to add next year?
MacLeod: We’d like to see another 25 added.
MTD: Opening a company-owned store seems to be a departure from O.K. Tire’s philosophy.
MacLeod: We’ve always stayed away from running our own stores. This is the first venture where we’ll go in and run the store ourselves. It’s important to have a store that is basically our flagship. The store also will evolve into a training center. As our business grows, training is required.
“One thing that has to be clear is that our shareholders own the company,” adds MacLeod. “The stronger they are, the stronger the company will be. They have a vested interest.”