Real solutions to real problems at ITE: Dealers share advice on how to recruit employees, market tires, expand your business and other topics
When 12 of the industry's most successful independent tire dealers gather to share ideas and strategies, people listen!
That's exactly what dealers from all over the country did during two seminars at last month's International Tire Expo in Las Vegas, Nev. They also raised issues of their own.
What follows is a no-holds-barred transcript of the meetings, which were moderated by former Florida tire dealer Don Olson. Panelists included:
* Jerry White, president of White Tire Supply in Beaumont, Texas.
* Bob Purcell, president of Purcell Tire & Rubber Co. in Potosi, Mo.
* Ron Lautzenheiser, owner of College Tire Inc. in Fort Collins, Colo.
* Bob Dabrowski, president of Tire Warehouse Central Inc. in Keene, N.H.
* Jeff Darrow, president of Certified Tire & Auto Service in Moreno Valley, Calif.
* Dave Komaromi, president of Tires to Go Inc. in West Sacramento, Calif.
* John Kauffman, president of Kauffman Tire Service in Forest Park, Ga.
* Paul Hyatt, president of Superior Tire Corp. in Toronto, Ontario.
* Charles Creighton, president of Colony Tire Corp. in Edenton, N.C.
* Chris Wyborny, general manager of Ramona Tire & Service Centers in Hemet, Calif.
* Phill Raben, treasurer of Raben Tire Co. Inc. in Evansville, Ind.
* Terry Westhafer, president of Central Tire Corp. in Verona, Va.
Seven of the above dealerships rank among North America's top 100 independent tire store chains, according to Modern Tire Dealer statistics.
On finding managers:
Darrow: Most of the ones we get are already within the industry. We don't hire store managers from the outside.
Dabrowski: We hire from the outside. We have a headhunter on board.
Kauffman: We run job fairs two or three times a year in different sections of (Atlanta). We generally go to a hotel and have four of our own people there. We get the word out by advertising in the paper. The response has been unreal.
On finding techs:
White: We ask parts houses if they know anybody. I will not go into someone else's shop and try to steal his techs. I think that's wrong.
Purcell: We have a folder with applications in it. I don't care if he works for another fellow; if we need someone, we tell him what our package is and let him decide.
Creighton: We hire techs from everywhere. To some degree, we create them. It's easier to find people who can work under the car than under the hood.
On employee incentives:
Kauffman: We have a career path we try to show everybody. It's really good for morale. We have a 401(k) and profit sharing. We have life insurance and hospitalization and pay it all for our management people. We have vacation packages and things like that.
Purcell: We try to have very little turnover by having 401(k) and hospitalization programs and the ESOP program, in which our employees own the company.
Creighton: We have a 401(k) and profit sharing based upon 10% of net profit from (the employee's) store. We're also employee stock owned. Each year they get stock in the corporation.
Hyatt: I make sure when I visit the stores that I say 'Hello' to my people. We make them feel important any and every way that we can. We believe in training; the Tire Industry Association has a wonderful program.
On Yellow Page advertising:
Komaromi: I once paid $15,000 six years ago for a Yellow Page ad. I cut it out in one fell swoop and my customer base cleaned up. We focused away from the shotgun approach to the localized approach. I'm glad we got out of Yellow Page advertising.
White: We spend $1,000 a month on Yellow Page advertising. It works well for us.
Dabrowski: For 25 years, we were just anywhere in the Yellow Pages. Now we're either first or second and it has worked.
Lautzenheiser: We're all hand-written on the tire side. We run speed lane service on tires. We line cars up like a car wash. On the oil change side, we use a sophisticated computer system.
Darrow: We take appointments. With people as busy as they are, they want to know they're scheduled in. Our best stores see 40 cars a day.
Purcell: We schedule cars coming in.
On selling to car dealerships:
Westhafer: We're in a small town and have found that our auto dealers are not geared to be in the tire business. They only order what they need in small quantities. I'd have to say that business is a nuisance. I'd prefer not to (do) it.
Wyborny: We got excited about it in the beginning but it's become more of a headache. We've actually pulled back.
On competing with car dealerships for auto repair jobs:
Creighton: The auto dealer is in the business of giving good customer service; they don't always do that, thank goodness, but they have better-trained people than Wal-Mart.
Hyatt: We have to be on our toes and give (customers) lots of reasons to come back to us instead of an auto dealership.
On factors to consider before expanding:
Kauffman: Never expand beyond your financial means. I always look to make sure I can sustain growth.
Westhafer: We're a 57-year-old business that just made its first attempt at (opening) a second branch. It was not from the perspective of 'Let's get bigger.' It was a logical move that strengthened our relationship with existing customers. It made sense from a service standpoint and a financial standpoint.
Raben: More often than not, it's finding the right person at the right opportunity at the right time.
On how to advertise a new outlet:
Wyborny: We've done heavy cross-marketing between radio stations and direct mail. You have to spend some money to do it.
Raben: You have to use direct mail. You can penetrate the market so much easier.
Kauffman: Advertising is a key factor. We've gone more to electronic media than print advertising. Electronic media offers better value than print. Personally, we think TV is better than radio.
On boosting sales at outlets:
Creighton: Better advertising, more ads and promotions.
Wyborny: You're going to have to find ways to increase your volume.
Westhafer: Sales are nice but bottom line is a whole lot better. I'd suggest a thorough examination of what you're doing. Increasing your gross profit is probably what you need to wind up with.
On fixing losing stores:
Creighton: We work with the store's management. You can have a bad location with a good manager and make money.
Wyborny: The manager sets the tone. It's leadership. I don't know if there are any bad locations.
Olson: If you have problems, it's usually a problem manager.
On offering discounts:
Dabrowski: We shop the area. Know what you're doing first. See what (your competitors) are doing. You may only have to discount from $50 to $45.
Lautzenheiser: We go 10% off on service as a rule, and only 5% off on tires.
On Internet sales and marketing:
Westhafer: We became a preferred Tire Rack dealer. At least if we mount and balance them and get to do an alignment and check a set of brakes, we've come out ahead. Working with mail order houses is a good way to get customers in.
Hyatt: We get requests for pricing and that kind of thing. We get the e-mail addresses of all our customers and on a quarterly basis send out e-mail specials. It's been very successful for us.
On getting maximum productivity from employees:
Hyatt: We have spiff programs. We share profits with our managers. We have a 'living P&L.' They have to put projections down for the whole year in almost every category and we ask, 'How's your plan working?' each month. There is accountability; their jobs depend on it and so does mine.
Westhafer: The immediate manager needs to be held responsible. There's an old saying: 'The fish rots at the head.' I'm not talking about working people to death; I'm talking about maintaining a decent level of productivity.