Dealers Fight COVID-19 – and Prepare for a Post-Pandemic Future
"None of us in the business today — and probably the last couple of generations — has had any kind of experience” like COVID-19, says Dominic Umek, group business leader at Cleveland, Ohio,-based Conrad’s Tire Express & Total Car Care.
That sentiment has been echoed by thousands of independent tire dealers across North America.
The onslaught of COVID-19, subsequent government restrictions and the severe, knock-on economic impact of those measures have had a profound impact on both tire dealers and tire manufacturers.
MTD’s editors have spent the better part of the last two months interviewing independent tire dealers of all shapes, sizes and specialties about how their businesses have been impacted by COVID-19 and the resulting economic fallout.
We discussed what dealers are doing to preserve the well-being of their employees and customers, still sell tires and auto service and ultimately ensure the long-term survival of their business.
Here’s what they had to say.
Tate Boys Tire rolls out ‘safer-at-home’ service
Craig Tate, president of Tate Boys Tire & Service LLC, which has seven retail locations throughout Oklahoma, says the impact of COVID-19 on his dealership was immediate.
“The first week of March, we were off to a great start for the month,” he says. “Business was normal. Then what we call ‘week zero’ — the second week in March — hit. We started to see an impact on our key performance indicators, including our customer count.
“The third week of March is where we really started to see a drop — in everything, right across the board.”
At first, the dealership — which employs more than 100 people — went into “hunkered-down mode,” he says. Then, seeing an opportunity, Tate created a crisis management team consisting of key staff members.
“I challenged them and said, ‘The whole objective of our company has changed. There are two things we are going to accomplish. The number-one thing is that we have to mitigate the spread of COVID-19 among our teammates, our customers, our community and our suppliers. Number two, we have to become a better company on the back end of this thing than we were when it started.” In late-March, Oklahoma Governor Kevin Stitt issued a “safer-at-home” order, which is similar to “stay at home” edicts in other states.
Tate Boys immediately instituted its own “safer-at-home” program “to stay contactless with customers, so they don’t have to come into our stores.
“We wear gloves with every transaction,” he says. “We’re putting credit cards in Ziploc bags. In our showrooms, we’ve spread chairs apart.
“There are X’s in front of our counters, where customers stand. We’re putting visual reminders in our stores to make sure we are maintaining social distancing — not just for our customers but also for our teammates.”
Tate is convinced his dealership will be in a stronger position after panic around the COVID-19 pandemic subsides.
“There are ‘aha moments’ that will come out of this that will change how everyone does business. I’ve challenged our people to find our ‘aha moment.’” ■
Point S dealer says keeping techs is a priority
For tire dealers in rural America, it’s not uncommon for a community’s economy to revolve around the largest business in town. But what happens when that “business” is a university, and a good number of its students leave town due to a global pandemic?
That’s the world Chris Cornelius and the team at Clair and Dee’s Point S Tire and Auto Service find themselves facing.
Rexburg, Idaho, is home to Brigham Young University-Idaho, a year-round university that this semester had more than 19,000 students on campus. In March, the university transitioned to an online-only education. BYU-Idaho has already said its next semester, which begins in May, will be online only. That means there’s no promise of a return to normal any time soon.
He doesn’t have an exact figure for how much of his business comes from the students and staff of BYU-Idaho, but estimates “the direct and indirect impact on our business easily would be 50%.”
Cornelius is trying not to panic, but “we need to react,” he says. And the business needs to protect its staff.
“What we need to do is make sure we don’t lose our highly skilled help — our technicians who have been here four, five, six or seven years, our full-time, ASE-certified mechanics. We’ve got to keep their families fed because we were already in a crisis of finding good help before this crisis happened.
“I don’t want to come out of this event not having them. It’s all hands on deck to do what we can to keep them.” ■
University Tire rides COVID-19 rollercoaster
Larry Williams, CEO and president of University Tire & Auto Center Inc., a seven-location dealership based in Charlottesville, Va., says he had a “heck of a month going” in March. Then the bottom dropped out.
“Our business is down 70%,” he told MTD during the first week in April. Williams was forced to cut his retail stores’ hours. He also reduced his employees’ hours. (“We’re trying to keep salespeople and hourly people to around 40 hours a week. Techs are flat rate. They can work as much as they like.”)
By the second half of April, business has improved by 25%, according to Williams.
He credits the rebound to “stimulus and unemployment checks hitting. And people are starting to come out. Talk about getting the country reopened again is making people feel more positive.”
Williams also operates Virginia Wholesale Tire Inc., which distributes to small tire stores and local car lots. In mid-March, his wholesale business started to decline as cash-strapped customers stopped placing orders.
One of his stores is located near the University of Charlottesville and relies heavily on student traffic. The university is closed. The store, he says, “is hurting. It’s such a trickle-down effect.”
On the upside, Williams’ distribution center is well-stocked and his inventory is paid for. At press time, his wholesale business was showing signs of life again as orders “are starting to pick up.”
Williams says there is no way you can compare the economic impact of COVID-19 to the economic impact of past disasters like 9/11 or the Great Recession.
“This is just ongoing,” he says. “And it looks like it will go at least through May and even into June.”
However, pent-up demand will eventually uncork, he predicts. “People still need to have their cars serviced. They will need tires sooner or later. Once we pull through this, I think independent tire dealers will do great.” ■
Conrad’s Tire acts after employee tests positive
What happens when one of your employees tests positive for COVID-19? Dominic Umek, group business leader at Cleveland, Ohio-based Conrad’s Tire Express & Total Car Care, can tell you.
An employee at one of the dealership’s 38 retail locations was diagnosed with the illness in early April — resulting in the 14-day quarantine of several other employees and a two-day store shutdown.
“The associate self-reported to us that he was having symptoms and that he was going to be tested and was waiting three to five days to get the results,” says Umek. “The health board later called and notified us” that the test came back positive.
“They walked us through the protocol they wanted us to follow, which involved the quarantine of other associates. We ended up closing the store for two operating days. And we hired a third-party professional cleaning crew to sanitize the store.”
The location reopened and Conrad’s pulled in employees from other stores to run it.
At press time, the worker who tested positive “was doing well,” says Umek. His fellow employees are working again.
“None of us in the business today — and probably the last couple of generations — has had any kind of experience” like COVID-19. “We’ve had to learn as we go and take our cues from the medical community and government.”
When contacted by MTD in early-April, Umek said the dealership, overall, was “running at 50% of the volume we did this time last year and half the volume we were doing year-to-date. I’ve never seen an impact like this.”
Road traffic in Conrad’s marketing area, which extends across northeastern Ohio, was down 50% at the time, according to estimates.
All Conrad’s stores remain open, but the dealership has been forced to adjust staffing levels and store hours. It also has taken numerous precautions to preserve the safety of employees and customers, including removing showroom chairs, providing protective masks and installing plexiglass “as another layer of protection.”
At press time, Umek told MTD that the dealership was seeing an uptick in business, which he credits to the delivery of stimulus checks and renewed optimism around the lifting of stay-at-home orders. ■
Sullivan Tire: This is the time to market to consumers
As automakers have shut down production lines and new car sales have taken a nosedive, Sullivan Tire Co. Inc. sees an opportunity.
Paul Sullivan says it’s a perfect time for tire dealers to talk to consumers about the importance of maintaining their vehicles.
“I don’t think people have the appetite to buy new automobiles,” says Sullivan, vice president of marketing for the nation’s 13th largest independent tire dealership. “That behooves us in the aftermarket to be out there with pertinent messaging about the upkeep of their automobiles.”
The dealership remains aggressive in its digital marketing on Google and social media platforms. It’s also using its database of customer contact information to reach out to consumers.
As of early April, that marketing helped Sullivan Tire maintain most of its business, even in the retail end. The company has 73 retail outlets in New England, and Sullivan says retail sales were down about 12%. “The automotive (service) at retail is sustaining itself. It’s tires that seem to be off. I think people are home and they’re saying, ‘Let’s fix what absolutely needs to be fixed,’ and they’ll run those tires down a few more 32nds.”
To serve customers safely, Sullivan Tire is offering curbside check-in service with free Lyft rides to and from stores, and limited vehicle pick-up and drop-off service at most of its locations. “We want to make it easier for people because we know people have a lot of pressure on them,” Sullivan says.
That same message applies to employees. Sullivan says the tire dealership is working to support its 1,300 employees. “We’re here to help them because we certainly know they’re helping us each and every day. It works in tandem.”
The efforts to stay engaged with customers come as one of Sullivan Tire’s biggest and most enduring marketing efforts has ground to a near halt. The tire dealership is heavily tied to its local sports teams, and the coronavirus brought the sports world to a stop.
The Bruins and Celtics were nearing the postseason, and the Red Sox were just about to play ball. For the month of April, Sullivan says the cost of ads that were to air on television during sporting events amounted to $170,000. (That doesn’t include signage costs.)
Pandemic aside, Sullivan sees no end to the company’s growth pattern. “We’re in a great spot post- coronavirus to continue our growth path,” he says. “We will be growing this company, and we’ll grow it very smartly, not taking on a lot of debt.” ■
Two Tire Pros dealers use time to paint
It took 10 years for Tred Shed Tire Pros to double its sales and grow from a $2 million store into a $4 million operation. It only took one month for COVID-19 to wipe away that progress.
“Up until about a month ago, I sure thought we were going to continue to climb,” says Kyle Schoenthaler, the third generation owner of the store in Pittsburg, Calif. “Now it’s just fallen flat on its face.”
Schoenthaler was 13 years old when he started working at the business his grandfather and father founded, and he began managing the company about 10 years ago. He bought it from his dad four years ago.
As of mid-April, both the dealership’s sales and tire units had fallen by 50%.
Plenty of retail-only tire dealers are in the same predicament, Schoenthaler knows. He’s tried to be frank with his 21 employees, and admits his gut instinct on the day California Governor Gavin Newsom announced the state’s stay-at-home order was to lay off half his staff. But he fought that instinct and has listened to the promises of government leaders and applied for assistance from the Small Business Administration’s Paycheck Protection Program (PPP).
“I should not still have all my guys staffed, but I’m trying to do what they told us to do. They said help is coming.”
While waiting for assistance, he put his team to work painting the showroom. They painted and cleaned up clutter. “We’re trying to stay as busy as we can.”
In Lincoln, Neb., Lynda Kester and her husband had a similar thought. They’ve owned Big Red Tire Pros since 2008. It’s an exclusively retail operation with eight bays and 10 employees, and the Kesters are working to keep their technicians — including their two sons — busy and on the job. It’s meant they’ve been working with some new tools — namely, paint brushes.
“It’s really hard to hire and keep good people,” says Lynda. “We’ve got a great bunch of people, and they like to be busy.” As business started to slow, she gathered the team and asked them, “How do you feel about running a paint roller?”
No one hesitated. “We want everybody to be here, not working for somebody else or standing in the unemployment line.”
After they finished the exterior painting, Kester says the team moved back into the bays.
They’ve been grinding rust off lifts and reorganizing tools and streamlining supplies. And they’ve been taking online tire training classes and Tire Industry Association training, too. ■
‘Watch every dollar,’ says Mountain View Tire VP
At the end of March, when MTD contacted Chris Mitsos, vice president of Mountain View Tire, which has 31 stores throughout Southern California, he was busy navigating the nuances of the CARES (Coronavirus Aid, Relief and Economic Security) Act and its loan opportunities.
Based on his calculations, “we’ll be able to qualify for a fairly large amount of money.”
At the time, the dealership had laid off 50 employees — most of them general service technicians “and a few salespeople.”
The reason? A 50% drop in car count.
“Our car count was down and our revenue was 50% down. They go hand-in-hand with one another.”
The company was then forced to lay off an additional 50 people. “We were starting to hear that the first phase of the CARES ACT Paycheck Protection Program (PPP) was running out of funds.
“The week of April 6 was a catastrophe” due to unexpected — and sustained — rainfall in southern California.
“Then, something miraculously happened — the sun came out and it was 81 degrees. Second, stimulus checks started arriving in people’s bank accounts. Third, the media started to focus its attention on steps that would be taken to open the economy. And number four, people, I think, just got sick of staying inside. We saw a 50% increase in business. Then it got even better.”
The third weekend of April “we did 75% of what we would normally do on a Saturday.”
Then Mountain View Tire received its PPP loan number. “Now we want to get the funds deposited into our account. Then we’ll bring back a big number of our people.”
In the meantime, Mitsos and his management team are looking for savings at every level. “We’re going over every single thing. You have to look at where every dollar is going. It’s really important to know your fixed and variable costs.”
Mitsos believes that “things will never go back to the way they were on Jan. 1 of this year. I think we’ll get close to that — possibly starting in September. Maybe by the first quarter of 2021, we will be hitting home runs again.” ■
Dealer uses stimulus money to give workers a paid day off
As a commercial-focused tire dealership, only 20% of Twin Valley Tire Inc.’s business is tied to passenger and light truck tires and automotive service needs. And yet, when trying to protect employees from COVID-19, Jamie Laroche says cutting one key service has helped limit customer-employee interaction.
“We suspended doing oil changes, unless it’s an emergency,” says Laroche, who, with Brendan Van Sambeek, owns six stores in South Dakota and Minnesota. They’re also part owners of Tires Only Group and Dakota Wholesale Tire Inc., and Smith Tire & Tread, a retread operation.
“I can’t really say we’re really down in any segment other than passenger and light truck, but some of that is on us. Alignments are by emergency only. We’ll do oil changes for the fire department or the police department.”
The company has locked the doors of its stores and posted signs for customers to call them from the parking lot. “We’ll meet you outside,” says Laroche.
Twin Valley Tire’s commercial business remains steady. “This is like our Christmas season and farmers are getting wound up. We still need to be here for them.” Service trucks are still rolling on regular hours.
In the company’s wholesale operation, route trucks are running each day, but drivers are instructed not to have any contact with people. They’re leaving invoices in plastic bags and dropping tires outside the customers’ doors. “We’re all trying to play the honor system.”
Laroche says the company is communicating with its employees regularly, stressing that they sanitize when they arrive for work, and anytime they move from one door or section of the business to another. They’re limiting traffic in between departments and are keeping employees spaced apart to follow social distancing guidelines.
That communication has included the option for employees to take one paid day off each week — depending on which location they’re assigned to. The company is paying for that benefit with money from the federal CARES (Coronavirus Aid, Relief and Economic Security) Act.
“Part of the problem we see is the stress of people thinking about COVID-19. They’re thinking about their families. Being hands-on in the tire business, we’re trying to give them a day off with pay.
“We’re a business that needs to be open. We need to take care of the farmers, the truckers, the ambulances and the fire trucks. We can’t stay at home. We can’t shelter in place.” ■
Steve Shannon Tire expands despite COVID-19
The COVID-19 crisis has forced some tire dealers to put expansion plans on ice. Steve Shannon Tire, however, is forging ahead with its growth plan.
The Bloomsburg, Pa.-based dealership recently added two stores. The first was a mid-March acquisition of another longstanding dealership, K&K Tire Barn. The second is a new location in Mansfield, Pa., that opened on April 6.
Built from the ground up, the Mansfield store is the company’s 21st retail/commercial center and fifth wholesale-distribution facility.
While Steve Shannon Tire’s consumer tire sales have dipped due to the economic impact of the COVID-19 crisis, its commercial truck and farm tire business remains robust.
“Farmers are still going full speed ahead,” says Jesse Shannon, who is part of the dealership’s management team.
“And the same is happening with trucks. It’s almost like they haven’t skipped a beat.”
Out of an abundance of caution, Steve Shannon Tire is watching employee hours closely and has cut store hours by 30 minutes a day.
“We definitely don’t want to shut down any locations. I don’t think that would be the right answer for anybody.”
The dealership’s wholesale customers — split evenly between small tire dealerships and auto repair garages — “are stocking a little less.” But he believes the wholesale-distribution business will recover.
Economic downturns are good times to look for acquisition opportunities, according to Shannon. “Maybe you know an older guy who wanted to stick around for three more years but now wants to retire?”
A period like this, he says, “can change an owner’s mind.” ■
Preparing for the worst while business remains ‘decent’
Through the first quarter and even early-April, business at Bauer Built Inc. remained “decent,” but that doesn’t mean CEO and Board Chairman Jerry Bauer is breathing a sigh of relief just yet.
“I think we’re right on the edge,” he says. “If the country stays shut down, and if it lasts through the month of May, business has got to be negatively affected. We’re going to have to prepare for that.”
That work is underway, even as Bauer admits the company, with operations in 10 midwestern states, has so far weathered the storm of COVID-19.
“We’re monitoring sales every day. We’re having more communication with our management than we’ve ever had. Normally, we’d be busy taking care of customers.”
What happens if business drops off by 25%, or even 50%? “We can’t continue doing what we’re doing,” says Bauer. “We’ll have to make some adjustments. We don’t have that plan yet, but we’re aware it may come to that.
“We haven’t taken much action yet because we haven’t had to. And we want to be cautious that we don’t overreact. Will it cost us something by waiting? Yes. But will it be good for our people? Yes.”
Sales through the first quarter were “fairly good,” he says. And while many businesses suffered in the second half of March, Bauer Built’s sales at the end of March and in early April “held up.”
Rural locations are experiencing sales declines, while some larger locations are doing fairly well.
Some of the success has stemmed from the heavy service that remains in demand as trucks continue to run. Bauer acknowledges there was also some fear-buying by fleets as tire manufacturers announced plant closures.
“There’s concern by fleets (about) supply and protecting their position. They’ve been doing some pre-buying, so we’ve been benefitting from that. We’re preparing for things to change because we think that most of that pre-buying is now behind us, and because the pre-buying occurred, that means there will be less buying later.”
Despite the challenges, there’s still room for growth. Bauer Built is expanding one of its tire centers, and Bauer says “we’re not backing away from that. We’re optimistic that need still exists and we’re going to continue to move forward. We haven’t backed away from anything that we’re working on.” ■
Schnipke Brothers find bright spots during crisis
Schnipke Brothers Tire’s consumer tire business has been negatively affected by COVID-19. But the Kalida, Ohio-based dealership has found two bright spots: farm and commercial tire sales.
“We’re still putting on new sets” of passenger and light truck tires — “but maybe one or two a day, compared to 15-plus on a normal day,” says Kris Schnipke, who owns the dealership with his brother, Keith.
“Thankfully, a lot of farmers are getting their equipment ready and we’ve been able to continue our service calls on new farm tires and repairs. Compared to last year, with such a wet spring and tanking grain prices, we are doing well. It just so happened that when things got slow with passenger tires, the ag tire side started to pick back up.”
The company’s commercial tire accounts are still moving supplies, “so that has been helpful when it comes to income generation.”
Ohio’s Governor Mike DeWine was ahead of the national curve in issuing stay-at-home orders. “We knew we had to make some changes to make sure our employees and customers would be safe,” says Chelsea Schnipke, who handles marketing duties for the company.
“We decided to lock all the entrances into our buildings and have put new signs on doors, requesting that customers stay in their vehicles. This has been helpful since we have large garage door bays — and sometimes, now that the weather is getting nicer, these doors stay open all day long.”
Other than the loss of consumer tire revenue, the hardest aspect of COVID-19 has been the lack of face-to-face interaction with customers, says Kris.
“For 20 years, we’ve been trying to get customers into our doors and our business. Now, with the flip of a switch, we are doing all we can to keep them out.” ■
Are UHP tire sales ‘immune’ to COVID-19?
Are ultra-high performance tires immune to the COVID-19-fueled economic downturn? Butler Tire & Service’s retail store in Atlanta, Ga., might have an answer.
Craig Dobrin, Butler Tire’s vice president of operations, says of the Marietta, Ga.-based dealership’s four retail locations, the Atlanta store — which specializes in UHP tires and custom wheels — has seen “virtually no slowdown.”
That’s a sharp contrast to Butler Tire’s other retail stores, which, at press time, were down 15% to 20% “in both store traffic and revenue.”
The Atlanta store is in an affluent part of town that Dobrin calls “the Beverly Hills of the city.”
Its high-income residents are still bringing in their vehicles for custom work. “A guy will come in with a Ford F-150 and we’ll do a set of wheels and tires and a lift kit and it’s a nice $1,000 sale,” says Dobrin.
“But it’s a complete ‘want.’ There is no ‘need’ whatsoever. We’re being carried by people who want things — not by people who need things.”
Just as surprising is the 15% year-over-year increase at Butler Tire’s sole commercial location. “We service contractors, plumbers… it’s been business as usual for them.” Ensuring customer and employee safety remains a top priority at Butler Tire’s stores. However, not all customers have complied with social distancing precautions.
“We initially put tape lines on our floors. People ignored them so we put up stanchions with tape.”
Some customers found their way around those, “so we resorted to unusual measures,” such as erecting a “wall” of light truck tires in front of sales counters.
The creative barrier will stay in place as more customers flow into Butler Tire’s stores in the coming weeks.
“I think at first it will be slow — like a faucet that will drip for a while. But I think over the next three to four weeks, whether it’s allowed by state governors or local municipalities,” people will start to come back out.
“People just can’t sit at home anymore. I think they’re bored out of their minds.” ■
Indiana dealer sees benefit to OEM shutdown
So what’s the upside of automakers shutting down production? Rich Elliott at Indy Tire Centers Inc. dba Best-One of Indy expects their tire suppliers to have plenty of capacity to serve the replacement market.
“I think the fact that OE is down and going to continue to be down is going to be helpful because they won’t be taking up large blocks of inventory,” says Elliott, president of the 10-store commercial and retail operation based in Indianapolis.
One truck tiremaker was even promoting a deal, which Elliott says was a sign to him that they have supply to sell. “We’re going to take their offer to our customer base and see what we can do with it.”
But the dealership won’t be stocking up on inventory in its own warehouses. “We’re in cash preservation. We’ll sell it out and then order it.”
Best-One of Indy has learned how to manage its inventory during lean times, most recently during the Great Recession.
“We’ve pared down our inventory,” says Elliott. “When business is flowing, you tend to make sure you have enough (inventory) so you never run out. When it’s flowing much more slowly, you find ways to cut back.”
The business at Best-One of Indy is an equal mix of consumer and commercial, and Elliott says that mix has helped it withstand tough times. He expects the commercial business will help support the retail side in the near term. Retail is down 40% to 50%, but showing signs of a rebound, he says.
Commercial was strong before the pandemic and benefitted from some national fleets that stocked up on tires in late March. “That gave us a nice shot in the arm.” But Elliott says it has since dropped off by about 12%.
The company’s retread operation has also decreased by 12% since pre-pandemic.
“Nationally, a lot of trucks are still rolling, delivering goods and services. Locally, the shutdown has caused fewer trucks to roll.”
And even while the retail business is suffering, Elliott says there’s a bright side to the equation. “I’m not a predictor of the future, but when they start letting people go back to work there’s going to be some pent-up demand.”
The company has been able to preserve its entire staff, and on April 15 received its Paycheck Protection Program loan from the Small Business Administration. Elliott says the company received its full payment, equal to two-and-a-half-months of average payroll. “That loan will achieve its intended purpose of enabling us to keep all of our team members employed and working to support their families and the economy.” ■
‘You worry about tires being like toilet paper’
For Don Mead, CEO of Callaghan Tire Inc. in Bradenton, Fla., his days are built around a three-point punch list: employees, customers and the future of the business.
Employee health: “I think about the health and safety of our employees and their families. We have to do everything we can to ensure their health and safety. And it’s not just the physical safety. It’s their mental health.
“We are in the coronavirus business right now, but we had a lot of momentum going into this. We had a tremendous first quarter. This will impact us, but it will end.”
Customer service: “We’re an essential business and most of our customers are essential businesses,” says Mead. “We have to maintain customer-readiness. We have to understand that every one of our customers has different criteria for how we’re supposed to engage.”
Future of the business: “Our job is to make sure we maintain business continuity. We have to come out financially strong.
“Unfortunately, we have to do all three.”
As of mid-April, Callaghan Tire’s overall business was running 10% to 15% behind the previous month.
There have been some positive moments, as some customers stocked up on tires because they weren’t sure what to expect. “I’m not anxious to just pull business ahead. At the same time, we want to be responsive to the fleet if their strategy is to pull supply.”
Some wanted to pre-buy a month’s supply of tires. “Normally, we’d deliver 100 tires a week, and they want that to continue, but they want 400 more to have in their facility,” says Mead. “No one’s been saying ‘I want 5,000 tires or seven truckloads of tires.’ I see they’re doing some risk management and I respect that.”
Some customers are doing steady business, including those in construction and waste removal, and those moving stock to grocery stores and Walmart. But then there are customers who aren’t essential and have closed their doors.
Callaghan Tire has implemented cutbacks. The company furloughed 19 of its 170 employees in April and hopes to call them back in 30 days.
The company also is closely watching its tire inventory, knowing that its historic sales models are now meaningless. They’ve limited the number of people who can order tires. “We’ve got a stricter process for that right now.”
Mead is less concerned about tire supply, even with production shutdowns, than he was a month ago. “You worry about tires being like toilet paper. Fill rates have gone down a little bit, but they’ve recovered.” ■
Associated Tires Stores’ ‘touchless service’ was ahead of the curve
Many tire dealerships have implemented “touchless” tire service programs in response to COVID-19. Logan, Utah-based Associated Tire Stores pioneered the concept 10 years ago, says Christie Stock, the dealership’s president.
“We don’t have tires inside our stores,” which stretch across Utah, Wyoming and Idaho.
With tablets in hand, the dealership’s employees greet customers when they pull into the store parking lot.
“We have the ability to create tickets and do everything outside,” she says.
Several years ago, the company rolled out a proprietary smartphone app that customers use to shop for tires and schedule appointments.
“They also can access their car’s service history, get text notifications when their car is done, pay through the app and if they get caught on the side of the road, they can press a button and we’ll send a driver out to them.”
Years ago, the company also replaced traditional in-store tire displays with flatscreens.
“We call it ‘The Digital Tire Store of the Future,’” says Stock. “And what a blessing it has been to have had that technology in place — and the fact our customers are so used to it. This put us in a good position when COVID-19 hit.”
Associated Tire Stores, which does business in Wyoming as Plains Tire and operates in Utah and Idaho under the Discount Tire & Automotive banner, also is using technology to communicate with store employees.
“I recently did my very first Zoom with every employee of our company. They’re very spread-out — up to nine hours away. I wanted to talk to them myself so they could see me and I could see them.
“I told them, ‘Your health is number-one. We want to take care of you. We don’t want you to worry about your pay or your hours’” during the COVID-19 pandemic.
“I told them, ‘If you’re sick, we want you to stay home — and we’re still going to pay you.’ At the end of the day, all we have is our people. If we take care of them, everything else falls into place.” ■
California-based dealer waits for rebound
It was like somebody turned off a faucet,” Scott Shubin, owner of Goodguys Tire & Auto Repair, says after California Governor Gavin Newsom ordered the state’s residents to stay at home in mid-March.
Customers started canceling scheduled maintenance like oil changes and tire rotations at Shubin’s eight locations, all of which are in the greater Fresno, Calif., area.
“The jobs coming in today are things that are broken,” he says. “‘My car doesn’t start’ or ‘I have four bald tires.’ We also do some national account business — people who have company cars. We’ve seen a huge drop in those. Sales reps aren’t driving around.”
The decline in business forced Shubin to “make some moves. We’ve adjusted hours. We’ve tried not to cut back significantly, but we’re being smart about it. The goal is to keep everyone working.”
Fortunately, the company “has plenty of inventory so we’re not scrambling” for tires and parts, he says. “A lot of distributors have changed their deliveries. We have a company driver who can pick up parts, when needed.” And Goodguys Tire’s ultra-high performance tire business has remained healthy. “Those customers are in a different economic class,” he explains. “They have discretionary income.”
His lower middle-class customers, however, will probably have to consider “downgrading. ‘I can’t afford $800. But maybe I could do $400 or $500. What do you have in that range?’ We have our own credit card that gives them interest-free payments for up to six months. We’ll have to use everything in our toolbox to provide for them.” When will business rebound in a meaningful way? It depends on when California will ease its shelter-in-place restrictions, says Shubin. Newsom recently extended shelter-in-place orders. “And they might be extended even further.” ■