When asked to give advice to tire dealers who are just starting out, Colony Tire Corp. CEO Charlie Creighton simply says, "Find a niche." Colony Tire has found two profitable niches in forestry tires and selling tires to ports.
Creighton was first exposed to forestry tires as a child. "I had relatives in the forestry business." But it wasn't until his stint as a Caterpillar salesman that he began closely looking at them. He learned about the tires and their fitments.
"The moment I went into the tire business I started selling forestry tires. At first it looked like a wide open market to us. But it took us a long time to get successful in the forestry tire business.
"It takes a lot of capital. You need big service trucks," which typically cost around $150,000, he says. Outfitted with tire manipulators, they can cost up to $250,000 each.
Pitching Colony Tire's services was another challenge. "Not every dealer around here was selling forestry tires, but loggers were getting tires from somebody, somewhere."
Colony Tire now counts 500 different firms among its forestry tire clients, most of them loggers, sawmills and paper manufacturers. These companies rely on Colony Tire's expertise to guide their purchase decisions.
"Forestry tires are a little more specialized than regular truck tires," says Creighton. In turn, Colony Tire charges a higher premium for them.
Selling tires to ports has been another lucrative niche. "We do a lot of port and container business in the Tidewater, Va., area," which includes Norfolk, Chesapeake and some other coastal towns. Colony Tire sells tires for machines that move containers around and for other applications.
"Ports also depend upon us for the technical services we provide. We've developed our own tracking software. They want us to manage their tires and also their tire cost.
"It's not the initial cost they care about; it's the total cost. And that's a real plus for us, because we can sell our services rather than just the price of the tire."
Colony Tire also sells plenty of retreads to port operations. Its supplier, Bandag Inc., even offers special tread patterns for container movers.
