"Better is bigger; expansion doesn't breed success," says Steve Cairns, "service does."
In a segment of the industry where the expansion of tire dealerships is the norm, Steve Cairns, owner of Commercial Truck Tire Center (CTTC), is an exception.
"Better is bigger," he says with a smile. "We're not unit-driven. Our focus has always been on profitability."
That focus has paid off. The East Syracuse, N.Y.-based dealership had one of the most successful years in its 15-year history in 2004 and is on track to do the same in 2005.
Service is king
It isn't that Cairns couldn't open another outlet or two. He's been asked by vendors on multiple occasions to add new locations. "But I'm not interested. We already generate a lot of revenue and a lot of income.
"The only ones who really benefit (from adding more stores) are the manufacturers because they'll sell more tires. You're the one at risk. For me that's never been a goal. I want to do what we do and do it well."
CTTC hangs its hat on customer service. "Service is the key," says Cairns. "Tires are a necessary evil. If I didn't have to inventory all those tires, I wouldn't do it."
Road service is a major component of CTTC's on-going profitability. The company runs six service trucks. "We do a lot of after-hour calls. We probably average 60 calls a month. Some nights, it's three or four or five calls." CTTC collects a handsome sum for its night-time work. Cairns charges triple the company's daytime rate.
The dealership is always in the process of updating its trucks. "I'm looking at installing GPS (global positioning system) in our trucks. I know we currently miss time and mileage. This will give us a report by truck.
"Plus it will improve the efficiency of how we dispatch calls. You can see where all your trucks are. A lot of times the closest truck may not be the best one available. We used to dispatch by two-way radio. That's old technology."
All of CTTC's service truck techs are certified under the Tire Industry Association's Commercial Tire Service program. "One of our guys is a certified instructor."
CTTC also is doing well selling pre-mounted tires. "It takes the competition right out of the picture," says Cairns. "Customers rely on you for it."
Regular yard checks are another well-received service. And CTTC makes a point to document tire life from start to finish using state-of-the-art computer tracking programs. "We look at ways to be different."
Even though CTTC has service down to a science, it isn't immune to trends within the truck tire market. What sets the dealership apart is its ability to work around problems, including present supply shortages.
"On some of the popular sizes, we're seeing a couple of weeks" lag time on delivery, he says. (For the most part, CTTC buys directly from Goodyear Tire & Rubber Co., Bridgestone Firestone North American Tire LLC and Michelin North America Inc.)
Normally CTTC's truck tire inventory turns eight times a year, "but we aren't going to see that this year."
Cairns isn't worried. "We have so many flavors. For example, we may not have the Michelin, but then we'll have the BFGoodrich."
Product substitution doesn't bother his customers. "It's not even an issue. It's not like we're giving them a (shoddy) tire. Most of our customers don't ask about price. It's, 'Do you have it? When can you get it to me?' They rely on us.
"I think supply will get worse before it gets better. But another good thing is that (the supply problem) has helped our retread business." CTTC operates a Bandag plant that produces more than 100 truck tire units a day during the summer months.
"We can command a little more for our retreads. But you have to be subtle. You don't want it to seem like you're sticking it to people. We've gradually increased our (retread) prices."
Fortunately, he reports CTTC isn't experiencing any problems sourcing truck tire casings.
Cairns says his employees play the biggest role in CTTC's success. "We have good people. We have the same people day after day, year after year. I treat my employees like my customers. I make them want to come to work every day. We have high standards. I offer good compensation. I try to lead by example."
He keeps the same salespeople on the same accounts year after year to maintain continuity and maximum customer comfort levels.
"People want to do a good job. If I hire the right person and nurture that person and support him, my job is easy. Your people are the key. They're the ones who are in the trenches dealing with your customers day after day after day. If you're smart, you recognize that."
Cairns' approach has been repaid with incredible employee loyalty. One of his employees has been with him since CTTC opened its doors. "Out of 20 employees, the majority have been with me over 10 years.
"A lot of people think you can put up a storefront, put tires in it and have some service trucks, but if you don't have the right people, you're not going to do business.
"We have a recession-proof business, if you do it right -- and as long as you take care of your customers and your employees."
Wide-base tires will be a niche item, says Cairns
As owner of Commercial Truck Tire Center (CTTC) for 15 years, Steve Cairns has seen a lot of products come and go. One product he believes has legs is the wide-base tire. (Goodyear Tire & Rubber Co. trademarked the name "super singles.")
CTTC currently sells wide-based tires to two fleets. "There haven't been any problems with them." Despite the product's quality, Cairns predicts they won't replace duals and will remain specialized niche items. "The issue most people have is where to get them serviced."