Ultimate Tire & Car Care’s location in downtown Nashville, Tenn., gives new meaning to the term “close competition.”
The six-year-old high performance tire dealership’s competition is literally right in front of it. A huge Firestone Complete Auto Care store is around the block, an independently owned Best One Tire & Service dealership is a stone’s throw away and a busy shop owned by Jennings Tire Co. is located four blocks down the street.
All three stores are well-established and do good business selling high performance and ultra-high performance tires, but their success hasn’t stalled Ultimate Tire. The dealership’s sales increased 10% to 15% between 2006 and 2007, according to Jim Baxter, one of its owners. (His partners are Bobby Armstrong and Jerry Martin.) “We have a lot of loyal customers,” says Baxter.
What they want
The key to building customer loyalty, he explains, is giving customers precisely what they want -- and not wasting their time with things they don’t want. Here are some examples:
1. No displays. Ultimate Tire does not display a single tire in its showroom. On paper, this seems like a strange strategy for a dealership that heavily promotes performance tires. However, Baxter believes there’s little correlation between displaying a tire and selling a tire in today’s market.
“Customers don’t feel the need to see and touch tires like they did in years gone by. We’ve found that customers are looking to us for advice. They know we’re going to stand behind the products and services we provide.”
Ultimate Tire does display several different custom wheel styles in its showroom. Customers still like to look at rims before buying them, says Baxter.
2. Anything and everything. Ultimate Tire is a true independent, Baxter notes. The company pushes the Bridgestone Firestone family of products (including the tiremaker’s Fuzion performance brand) and sells quite a few Kumho, Falken and Yokohama brand tires, but it can source products from anywhere.
“People don’t seem to be as concerned with having a (top price tier) tire as they used to be. Many lean toward some of the minor brands. There will always be a Bridgestone customer, a Michelin customer or a Goodyear customer, but I think the quality of tires as a whole has progressed so much that (customers) find they can do really well with brands that are not as well known.”
3. Double guarantee. It never hurts to up the ante when it comes to product guarantees. “Several tire manufacturers offer 30-day ride guarantees; we offer that on any tire we sell. If the customer doesn’t like the tire within 30 days of purchase, he can bring the tire back and we’ll give him full credit towards another tire.”
Baxter can only think of two or three instances in which tires were returned. But he says customers like knowing they can always return a product they don’t want.
Ultimate Tire’s guarantee also demonstrates that the company is not out to get the quick, one-time sale.
4. Trust factor. Baxter and his partners are long-time fixtures in downtown Nashville. Before opening Ultimate Tire, they worked for a dealership called Universal Tire.
“Our customers know we have the knowledge, ability and equipment to handle their cars.
“They don’t want to go to some guy who’s going to put their UHP tires and aluminum wheels on a center post machine.
“We stay up to date on equipment. We have rim clamp machines to handle up to 22-inch wheels and arm assists to help with ultra-low profile, 30- and 35-series tires.”
5. Convenience. The majority of Ultimate Tire’s performance tire customers work in downtown offices.
“Nashville is a thriving city, but it’s not unusual for people to commute 25 miles to work.”
Customers usually drop off their cars in the morning and pick them up at 5 p.m. Baxter, his partners or their employees shuttle customers to their places of work via company cars. “We restrict that to the downtown area,” says Baxter. Ultimate Tire doesn’t schedule tire service, preferring to work on a first come, first serve basis.
Baxter describes his performance tire customers as “more conservative tire buyers.” They’re generally well-heeled and drive high-end sports cars, “and they bought the vehicle for the vehicle, not the tire. We don’t get a lot of people who are looking to up-size or do anything like that, especially on the newer cars because it’s already been done for them by the (auto) manufacturers.”
Ultimate Tire is equipped to cater to tuner customers as well. “But we really don’t pursue the tuner market... the younger generation that’s putting a 20-inch tire on a Honda.”
Another key to Ultimate Tire’s success is keeping a clear division of labor. The dealership actually has two locations in downtown Nashville, but only one handles tires. (The second location is dedicated to heavy mechanical work like engine overhauls, transmission repairs and other labor-intensive procedures.)
Two bays at the company’s tire store are dedicated to tire work: mounting, balancing, rotations and repairs.
Three additional bays on the other side of the building are dedicated to undercar work. “We’ll process nine to 10 cars at a time” through all five bays, says Baxter.
To further increase efficiency, he and his partners have streamlined the number of performance tire skus they keep on-hand. Ultimate Tire sources from American Tire Distributors Inc., S&S Firestone Inc., Dunlap & Kyle Co. Inc. and several other wholesalers, all of whom provide multiple daily deliveries.
“We basically get tires as needed. Whenever we can take advantage of just-in-time inventory, we want to do so.”
The arrangement also keeps cash flowing since fewer dollars are tied up in stock.
High and ultra-high performance tire prices rose during 2007 due to a seemingly endless cycle of manufacturer price increases.
Ultimate Tire passed the hikes along to customers seamlessly.
“People may shop around for the best price, but with the proliferation of tires we make available, we can find something in their price range.”
Baxter has found that in most cases customers rely on his staff for tire recommendations.
“The question we get is ‘What would you put on your car?’ And we’re honest with them.
“There are a lot of tires out there that we wouldn’t hesitate to put on our cars and have put on our cars.”