When you preside over a $200 million a year enterprise with 40 locations in nine states, making big decisions is part and parcel of daily life.
Buying new equipment, acquiring new locations, managing personnel, charting your company’s strategic direction, adjusting to ever-changing market conditions — all of these things require decisive action.
But rarely, perhaps only once in a career, are you confronted with the choice of severing ties with a company that has been supplying you with tires for more than 25 years in order to sign with a new supplier.
That’s the situation John Snider, CEO and president of Snider Tire Inc., faced in 2009, when he changed retreading systems.
Snider, Modern Tire Dealer’s 2010 Tire Dealer of the Year, had to choose between Bridgestone Bandag and Michelin. It turned out to be the toughest decision of his 30-plus year career, with long-lasting ramifications. (For the full story, click here.)
John Snider’s ability to make smart decisions and capitalize on opportunities when they appear has enabled Snider Tire to grow into one of the tire industry’s most successful ventures. The company even expanded during the toughest economic climate in 50 years.
Snider Tire operates in a state of perpetual forward motion, and with John Snider at the wheel, the dealership is expected to break even more new ground as its phenomenal growth continues.
Humble beginnings
Snider Tire also is one of the fastest-growing dealerships in the country, having added 10 locations in 2009 alone.
While John Snider gives ample credit to his employees for the company’s spectacular success and tends to downplay his own contributions, one thing is certain: without him, Snider Tire would not exist in its current form.
Snider has been the prime mover behind the dealership’s ascension, seizing opportunities that other tire dealers missed, ignored or didn’t have the vision to pursue. “The commercial tire business is an operations business,” he says.
“It’s not difficult to understand what you have to do to be successful in the commercial tire business. It’s just really difficult to do it, and to do it every day.”
With his wealth of knowledge and hard-fought experience, Snider makes it look almost easy.
Snider is a second generation tire dealer. His father, John H. Snider, bought a small, single location tire shop in Greensboro, N.C., in 1976. Prior to that, he worked as a district manager for General Tire & Rubber Co.
Unlike many second generation tire dealers who grew up in their father’s business, the younger Snider didn’t work for his dad’s dealership until after he graduated from the University of North Carolina in 1977.
However, John had accumulated plenty of tire shop experience by then.
In high school, he worked at a General Tire & Rubber Co. store, sweeping floors, changing tires and eventually selling them at the counter.
Snider Tire was his first post-college job. “I graduated on a Friday and started on a Monday. I didn’t take a long trip to Europe to ‘find myself.’ I didn’t go to work at a ski resort in Colorado. I just went to work. I became my dad’s 21st employee.”
At the time, Snider Tire did a little bit of everything. It operated a small retread plant that produced 10 to 15 units a day. It also sold household appliances and was one of the largest television set retailers in Greensboro.
But commercial tires were the company’s bread-and-butter. “My dad, during his career, was more skewed toward the commercial side of the business, even when he worked for tire manufacturers.” (Before working for General, the elder Snider worked for Firestone Tire & Rubber Co.)
The dealership was small but successful. “The first year my dad owned it, we did a little less than $1.5 million in revenue.”
Working for such a small dealership was “a good education,” says Snider. “When you have a small business, you do a little bit of everything. If a retail customer walks through the door, you help him. You might pull his old tires and mount new tires. You might be the commercial tire service manager for a day. You wear a lot of hats.”
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The start of something big
Meanwhile, the Sniders tried to drum up new business. “My dad was active in the North Carolina Motor Carriers Association. He knew a lot of people, and he would occasionally encounter friends of his who did business with a company called Super Tire.”
Super Tire, which was based in New Jersey, “was years ahead of the industry,” says Snider. “They had developed a mounted truck tire program. They had locations and systems to support the program.
“My dad was fascinated by their program. He would approach (prospective customers) and they wouldn’t even listen to him. They’d say, ‘We’re using Super Tire.’ And these people probably would have liked to have given my dad some business! He was intrigued by that, so we decided to emulate what Super Tire was doing on a more regional basis.”
Snider Tire launched its own mounted tire program. It was slow going at first, but in the early ’80s, the dealership landed a major trucking industry client that had locations all over the U.S.
The firm had been buying from Super Tire but “had some issues with them. So the company’s director of maintenance, a gentleman named Jerry Baxter, said, ‘I’ll give you three of our locations — Greensboro, Charlotte and Fayetteville, N.C. — and we’ll see how you do.’
“When he told Super Tire what he was doing, they said, ‘In that case, just give them all of your locations in the Southeast.’ They were trying to force his hand. They didn’t want him to do business with someone else.”
Baxter, who managed 10 locations overall, came back to the Sniders and explained the situation. “I said, ‘We’ll take care of you.’ We got our folks on board and we did it. I would hand-bill all the orders, we’d load the tires on a truck, and then we’d deliver them. Then we’d bring back the mounted tires they had pulled off their trucks.”
All of the work was performed at Snider Tire’s Greensboro shop. Snider admits the fledgling program had inefficiencies “but the customer never suffered. That was the most important thing to us. He took a chance on us and we couldn’t let him down.”
The Sniders continued to refine the program.
Then they received a visit from a stranger that would set off a fortuitous chain of events.
Getting on TRACS
Bernie McNally had been working at Super Tire for several years. After holding a variety of positions, McNally reached his glass ceiling and decided to leave the company in 1984.
McNally was aware of Snider Tire and its mounted tire program. He contacted the dealership with a proposal: Why not form a consortium to compete against Super Tire?
“He understood the whole mounted tire concept,” says Snider. “He came to our office and my dad and I spent about four hours with him.” They hired McNally shortly thereafter. (He now works as Snider Tire’s vice president of fleet development.)
Then fate stepped in again.
Before McNally went to work for the Sniders, a private investment group had acquired Super Tire. The group’s ownership of the company turned out to be turbulent and short-lived.
Around the same time ownership of Super Tire changed hands, trucking companies engaged in a huge pre-buy of truck tires in order to beat a looming federal excise tax increase.
Super Tire’s sales dwindled and the company liquidated in early 1985.
“All of a sudden, we were the only choice a lot of these companies had if they wanted to keep buying mounted tires,” says Snider. He and his dad saw a golden opportunity.
“We knew a lot of people who worked for Super Tire who were suddenly out of work. We needed more employees, they needed jobs, so we took over an old Super Tire location in Ohio and another in Louisiana.”
Up until this point, Snider Tire’s operations had been limited to North Carolina. That quickly changed as more trucking companies signed with the dealership. Snider Tire began adding satellite locations to service them. The company’s customer list grew rapidly, which led to another Snider Tire innovation: its proprietary Tire and Retread Asset Control System, or TRACS.
“We realized that if we wanted to be successful, we had to have systems in place to manage all of the transactions and track the tires we were handling. We wanted to give our customers an audit trail, so in the mid-’80s we started to develop our own software to track these transactions.
“We were doing business with multi-location customers, so it was critical that we develop a system. At the time, everything was done manually, and there were some real challenges.”
Snider Tire hired contract programmers to write the software and tweak it as customers’ needs changed.
“Initially, the program tracked tires, but it wasn’t integrated into our billing system. We integrated the two systems.”
TRACS was an immediate success. It remains one of the cornerstones of Snider Tire’s mounted tire business, which continues to generate a significant percentage of the dealership’s overall revenue.
Snider Tire’s mounted tire program has evolved over the years, according to Snider. “Early on, there wasn’t anybody we were competing with. It was our niche. As we became more sophisticated, we started to market the program.”
As more fleets began using the program, Snider Tire added locations, including one in Houston, Texas. Expansion “was driven by the needs of our customers. We were going where they asked us to go.”
Growth led to more technological innovations. By this point, massive quantities of tires were moving in and out of Snider Tire’s facilities. It was more critical than ever to keep records of what tires belonged to which customers.
“We were using hand-written tickets. If a driver went out and picked up 100 tires, he filled out 100 tickets. He would leave a receipt and come back here, and we had a clerk who would input 100 tickets into our computer system.”
Too many errors were occurring under this system. Snider began searching for a solution.
Around the same time, he traveled to Houston to visit the company’s new location. At the end of his trip, he dropped off his rental car. “The guy working there had a hand-held computer that printed out my receipt. I said, ‘What is that?’ I got the name of the company that made the unit and flew back to Greensboro.
“We called the company and found out they had a division in Greensboro that had developed hand-held computers for the lumber industry.”
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The company said it could develop hand-held units for Snider Tire. Snider was ecstatic. In 1990, Snider Tire equipped all of its drivers with hand-held computers.
“Nobody else was doing it at the time. When a driver would come back in with a trailer load of tires, the unit would download all of the data about the tires into our system. We even had printers on the trucks. It was 100% accurate and very sophisticated.”
The scanners came at a substantial cost. Each hand-held unit cost several thousand dollars. “But it was a great investment. Nobody else was doing anything remotely close to it. In fact, I didn’t see anything similar until around 1995.
“Our information system became pretty robust with these new reports that we were able to provide to our customers.”
One of the advantages of Snider Tire’s mounted program is its predictability, according to Snider.
“The program runs Monday through Friday. It’s very regimented. For instance, every Tuesday for 52 weeks a year, a driver knows he will go to a certain customer’s location at a certain time.”
The program is tailor-made for large fleets with multiple locations, he says.
“Sometimes it’s easier to deal with that larger customer who is going to buy 1,000 tires a year because he understands the value of it. I think that oftentimes when we are dealing with a vice president of maintenance or a chief financial officer, they are looking at the life cycle cost of what we’re selling and they understand the value that’s built into a controlled, consistent program.
“When our customers ask, ‘Who’s your competition?’ we tell them, ‘Our competition is your cost.’
“If we can work together to make their cost trend in the right direction and keep it at a certain level, that’s all the security we’ll ever need. I’m not so naïve as to believe we can never be replaced. That’s why we make sure the relationships we have with our customers are mutually beneficial.”
Achieving critical mass
As Snider Tire continued to expand into new markets across the country, it reached what Snider calls “critical mass” by the mid-1990s.
“We had enough buying power with the tire manufacturers and we had developed the infrastructure and the back office needed to run the business, so we said there’s no good reason why we can’t grow our local commercial business in the Southeast.”
At the same time, Snider Tire continued to attract top talent, including Marty Herndon, who came to Snider from Tire Centers LLC.
“He was the catalyst who helped us grow our local commercial business. We opened an outlet in Charlotte and that became our growth model.”
The company began adding new outlets and ramping up existing ones in other large metropolitan areas like Atlanta, Ga. Then it moved into smaller, secondary markets.
It was a great time to focus on a specific region like the southeastern U.S., says Snider. “There were still a lot of single, maybe two- or three-location dealerships, but there weren’t many regional dealerships like you have today. Back then, if there was a company doing $12 million a year, it was a serious player.”
Snider Tire supplemented its green-field growth with well-timed acquisitions. The company entered the South Carolina market via acquisition in the year 2000. Four years later, it purchased WNC Tire Inc., a single-location dealership in Asheville, N.C.
In early 2010, Snider Tire finalized its acquisition of Consolidated Tires Inc., giving it four more commercial tire outlets in South Carolina, plus another retread shop. (Snider Tire currently runs five retread plants.)
Acquisitions can be tricky propositions, according to Snider. “As an outsider, anytime you go in and look at a company, regardless of how much due diligence you perform, you’re never going to know everything about that business until you own it. Not that people try to mislead you; the timing is just very important.
“I think you have to use a great deal of caution when you make acquisitions. You have to understand what you’re buying and you have to be realistic about the value of the business.”
Sellers often place a higher value on their business than the reality of the situation dictates, he says.
“As a buyer, we’re looking at financial records and are trying to establish a value based on what is actually there. It’s emotion vs. logic. The seller is thinking, ‘I’m checking out. This is my one chance to make my money and go fishing.’ We’re thinking, ‘We have to run this business into the future.’ So you’re coming at it from different directions.”
The ultimate goal is to arrive at a price that’s “amicable and fair.”
While acquisitions can be difficult, instilling your company’s culture within the organization you have acquired can present an even bigger challenge, he says.
“Regardless of what anyone says, when you’re courting a company that you want to buy, in the end, if you pay for it, you own it, and you don’t adopt their culture. You want to be sure their key people share your philosophy and work ethic so you don’t have a lot of conflict.”
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Loyalty: a two-way street
Snider Tire employs more than 800 people at 40 locations. Many of those employees have been with the company for several decades.
One, Carson Coppage, the receptionist at Snider Tire’s corporate headquarters, started with the dealership more than 30 years ago. In addition, at least 10 of the firm’s employees have parents who worked for Snider Tire.
There’s an art to keeping and motivating talented people, according to Snider. “Obviously, you need to have certain table stakes like compensation and benefits. One thing we also have been able to do because of our growth is give people mobility within the company. We’ve given people a career path. A lot of our managers started with us as hourly employees. I can cite a number of examples of people who started with us changing tires or driving a truck and today they’re running multi-million dollar locations, and doing it very effectively.
“We’re not going to pigeonhole someone in a job and just leave them there. If they have the skills and ambition to advance, we’re going to help them do that because we have needs, too.”
He admits that some degree of employee turnover is inevitable. “We strive to have a core group of employees making up about 80% of our total population — employees who are well-trained and have some longevity with the company. And there’s going to be that 20% on the periphery who will come and go. That’s OK. We use temps and we have part-time people.
“Over our history, I think we have developed a reputation for treating our people well. We certainly felt the economic downturn in the last year-and-a-half, but historically, this industry has been recession-resistant.
“We haven’t had layoffs, so we’ve developed a reputation for stability. We also have made an effort, particularly with our hourly workers, to recognize those people for what they are. They’re highly skilled, their jobs are important, and they are the people who are touching our customers.
“About eight years ago, we sat down with our senior managers when we wanted to get into the local commercial tire business more and do more emergency after-hour road service. We wanted to upgrade the image of our commercial service technicians. We said, ‘Starting today, we’re not going to refer to them as service guys or servicemen. We’re going to refer to them as service technicians.’ And that’s how we refer to them.” (For more, see sidebar following the end of the this article.)
At a crossroads
Last year was perhaps the most challenging period in Snider Tire’s history. Like many other commercial tire dealerships, the company struggled with a down economy. It also switched from its long-time retread supplier, Bridgestone Bandag Tire Solutions, to Michelin North America Inc. and the company’s Michelin Retread Technologies Inc. arm. Snider says it was the toughest decision he’s ever made.
By switching suppliers, “we compounded the turmoil,” he admits. “A lot of the issues we were dealing with were economic, but some were self-inflicted, to a degree.”
Dealer-supplier relations, in general, have changed over the years, he says.
“When I began, it was a different set-up. You had a lot of small dealers and it was more of a cat and mouse game. Everybody was trying to get a deal. We would try to get an extra $5 a tire, and if it was the end of the quarter, they wanted us to buy an extra 100 tires.
“I would say that today, because of the way the industry has evolved, those relationships are more collaborative.”
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“We’ve always had good relationships with our suppliers. We’ve always treated them with respect. We recognize they have to make a living, too. But that doesn’t mean we don’t try to negotiate and drive a hard bargain.”
Snider Tire’s suppliers say Snider is tough but fair.
Clif Armstrong, director of marketing, commercial vehicle tires, the Americas, for Continental Tire the Americas LLC, was Snider Tire’s Continental truck tire sales representative from 2002 through 2003. “I’ve known John for quite a long time, and the word that comes to mind when attempting to describe him is ‘classy.’ He does business up front. There’s no hidden agenda. The Snider Tire group is very professional. Most customers who do business with Snider Tire stay there a long time.
“John has a great team of people underneath him, but there’s no doubt that he’s the leader.”
“John is a very smart businessman,” says Dan King, vice president of sales and marketing for Yokohama Tire Corp. “You have to come with your ‘A’ game when dealing with him. But you get into good dialogue immediately, and usually that means you have a much better outcome for both parties.
“If I was going to put someone out there and say, ‘Here is somebody that represents our industry,’ I don’t know if there would be anyone better than John.”
“John is a highly respected professional within the industry,” says Francois Corbin, COO of Michelin Americas Truck Tires. “His company is very successful because his first priority is to service his fleet customers, and John leads the company based on this proposition.”
Enter MechanEx
Five years ago, trucking fleets wanted tire dealers to “take them out of the truck tire business,” according to Snider. Many fleets are now starting to outsource other work, including preventive maintenance and mechanical repairs.
Snider recognized this trend early. “As we talked with our customers, we felt there was a need to offer some mobile and fixed-bay mechanical truck services.”
In response, Snider Tire launched MechanEx, its mobile truck repair business, four years ago. Services include mobile alignments, trailer repairs, brake work and other functions.
“There are yards with hundreds of trailers, and we’ve found this represents a great opportunity for us. If we have a customer with 50 trailers and we can go out there and put mud flaps on them and fix their flat tires and replace some lights that have burned out, that is a very valuable service, and it can be done easily. It has become a fast-growing part of our business.”
It also has led to more business. “We have some customers we’ve done mechanical work for and we’ve gotten their tire business eventually. We also have customers we’ve done tire work with for years and we’re now doing their mechanical work.”
Along the way, Snider Tire has tweaked the MechanEx service menu based on changes in supply and demand.
“Early on, we thought we’d do fleet washing,” he says. “We quickly realized we weren’t going to make any money doing that. It’s not hard to get into fleet washing; your competition is a guy with a pickup and a power washer. But that’s who sets the price.
“We’re not afraid to fail and we’ve done it. We’ve learned a lot and some of those lessons have been pretty expensive. That’s just part of the process.”
Several years ago, Snider also identified another strategic opportunity: online truck tire ordering.
“Because we do business with customers who have multiple locations, one of the challenges is getting orders in a timely fashion and getting approvals. Some of our customers also use unique combinations of tire and wheel sizes. There are a lot of opportunities to make mistakes.”
Snider Tire designed an in-house custom ordering system that allows clients to log onto a secure Web site using a special, individualized password and place orders for tires.
“When a person logs in, only his company’s information comes up. He can say, ‘I need four steer tires, eight drive tires and 16 trailer tires,’ and then hits the send button. When he completes his order, it comes to us by e-mail. In some cases, it also goes to someone in the customer’s organization for approval; that’s an option we offer, as well.
“The way the system is built, it will only allow him to order the products that his company specifies and the combinations of tires and wheels that are used by his fleet.”
The online ordering system also includes a “very robust” history function that tracks when orders were placed and received.
“Not all of our customers use it. It’s not a requirement. We leave that up to the customer.”
In addition to streamlining the ordering process, the system “keeps everybody honest from an accountability standpoint.”
Well-respected by his peers
There is no “typical work day” for John Snider. Whether it’s meeting with customers and suppliers to managing internal operations, each day, he says, brings new challenges.
And some of them, he explains, are not entirely unique to his company.
That’s one reason why Snider Tire belongs to the American Commercial Tire Network (ACTN), a group of 17 independent commercial tire dealerships that together offer nationwide emergency road service at predetermined rates. Combined, the companies operate 1,700 service trucks in 40-plus states.
The ACTN — whose membership roster includes such heavy-hitters as Belle Tire Distributors, Bob Sumerel Tire Co., Parkhouse Tire Inc., Pomp’s Tire Service, and Sullivan Tire Co. Inc. — was established in 1999.
“The initial concept was to provide reciprocal road service to non-national account customers,” says Snider. “For example, if I had a customer and he happened to be in another member’s area, that member would provide service to him at a price we had agreed upon.”
Snider Tire was asked to join the group one year after it was formed. Since then, the organization has added many member services. (Snider has been its president for 10 years.)
“We do educational things for group members. We have vocational meetings where we will get our financial people together, our safety people together, and our manufacturing people together, and then let them develop a group of peers they can communicate with. We’ve developed two training videos (in conjunction with) the Tire Industry Association — one about wheel torquing and one about the proper way to perform emergency road service.
“We’ve done a lot of benchmarking. We do an online survey each month that asks how your business compares, percentage-wise, to (the same month) during the previous year. You can see how everybody else is doing.”
Snider emphasizes that the ACTN is not a buying group, nor does it market directly to customers.
“We look for ways to strengthen our individual businesses,” he explains. “It also gives us a forum to discuss whatever we want to discuss. If you go to a manufacturer-sponsored meeting, they’re going to pretty much control the agenda. We can sit and talk about things that are common issues and concerns.
“And beyond that, I’ve developed good friendships with these guys. They’re no more than a phone call away.”
Jim MacMaster, retired executive vice president of Yokohama Tire Corp., has known Snider for 10 years. They met when Yokohama began doing business with ACTN.
He says it’s a “heck of a compliment” to Snider that he has remained ACTN’s president for so many years.
“John is one of the nicest, brightest, most ethical people I’ve ever met in this business.
He’s one of those rare finds. You don’t need a contract with him. His word is his bond.
“He believes in establishing a relationship that allows both (parties) to do well. There are some people in business that if you don’t do it the way they want it done, they’ll tell you you’re not going to keep them as a customer. John is not like that.”
‘You can’t get stagnant’
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After a horrendous 2009, Snider believes the truck tire market is on the road to lasting recovery. “It’s good right now. It’s very robust.”
From a sales and profit perspective, Snider Tire is well ahead of where the company found itself 12 months ago.
“We’ve moved through our (supplier) transition and we’ve gotten our business back on a more familiar trajectory. We’re more focused on our customers and our operations and less focused on all the noise that came from that transition.
“I think our folks are happy to be back where we are. In the best of times and the worst of times, there are always challenges in any business, and we certainly have our share. But most of our challenges today are related to growth and things of that nature, which are more fun problems to deal with than others.”
However, for growth to be successful it must follow a logical pattern, he says. “We have ideas and things we’d like to do, and none of them are radically different than what we’re doing today. We want to continue to grow our tire business, both with market share and geographically. We would like to continue to develop TRACS. Our mechanical program is an area that will grow.”
While Snider intends to expand, he also realizes that the tire industry, like other businesses, is getting progressively leaner.
“The reality is most businesses are doing more with less and that puts more pressure on people. Our company has grown dramatically, but we’re working as hard as ever, and I would say the same thing about most of my peers.
“One thing I’ve seen over the years is that people achieve some level of success and then just want to go out and enjoy their success. That’s usually the end of their success. If you can stay focused, you can build upon your success. You can’t get stagnant.”
Snider says he gets excited about the same aspects of the business that he enjoyed 30 years ago. “I really like meeting our customers, suppliers, my co-workers and my peers. We do business with customers who have very interesting companies. Some of them are large businesses and some are very small businesses.
“The tire industry is not glamorous. It’s not sexy. It’s just a basic industrial business full of people who get up and go to work every day. They shake your hand and their word is good. And that’s enough to keep me going every day.
“I also look at our organization and the number of houses that have been bought and the number of (employees’) children who have gone to college... I feel an obligation to that. Snider Tire’s employees are counting on me to make good decisions on their behalf.
“I’m still having fun. I enjoy what I do and the people I do it with. If somebody came in and bought this business and I walked away from it, in 30 days I’d have to find another job. I don’t want another job.
“Everyone in this industry, at some point, has to ask themselves, ‘What’s the end game for me?’ That could mean different things to different people. I’m happy where I am.” ■
(For the sidebar on "Stay with Bandag or switch to Michelin?", click here.
Sophisticated service -- Snider Tire’s high-tech road service system captures ‘lost’ business
Emergency road service work is a critical part of Snider Tire Inc.’s business. The dealership runs up to 200 road service trucks around the clock and uses a sophisticated, closed-circle system to track the number and duration of service calls, service truck and customer vehicle positioning, miles driven to destination, and other factors that when glossed over, can contribute to lost time, manpower and revenue.
Just as importantly, the system tracks service requests that technicians did not respond to, notes John Snider.
Years ago, he says, “a customer we wanted to do business with might call us at two in the morning,” but a service technician would not be dispatched to him “for whatever reason. We had no idea this was taking place! We decided that if we were going to be in the road service business, we would have to do it well, so we started to develop our service program.”
Today, Snider Tire’s emergency road service program includes:
• A professional call center that fields after-hours calls. Phone attendants, operating under the Snider Tire name, collect customers’ information and then dispatch technicians to their downed vehicles. Each call is digitally recorded. Audio files can be e-mailed to customers if post-service disputes arise.
• Global positioning systems in all service trucks. “We can track where the truck went and when it was on the job site. We can triangulate back to exactly what happened. It keeps our customers accountable and it keeps our people accountable.”
• Special “night inventories” specifically set aside for service technicians. Stock is replenished every day.
• Morning follow-up reports. “Each morning, I get an e-mail that lists not only the calls we serviced, but any that we may have turned down.”
“The after-hours service arena is an imperfect world,” says Snider. “You might have a customer who doesn’t know where he is, you might have someone taking a call who jots down the wrong tire size, or a service technician might hear something wrong. There’s a lot going on at two in the morning.
“Our system puts accountability on everybody, which is what you need. And it has allowed us to make contact with people we maybe were not doing business with previously.”
