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Up and comers

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Up and comers

Diane and Dan Hennelly are the heart and soul of The Tire Choice. Or the soul and heart -- it's hard to tell because they are pretty close to inseparable.

Diane is the pragmatic one. As vice chairperson and CFO, she handles the finances, and reins her husband in when he tries to grow the business too fast.

She came up with the business plan and name of the dealership in college.

Dan is the sales guy. Years of experience, first at Goodyear Tire & Rubber Co., next under the tutelage of Larry Morgan at Morgan Tire & Auto Inc., gives him 20-10 eyesight. He sees the world smaller than it really is.

When he says The Tire Choice will grow to 35 stores by 2010 -- and perhaps to 50 stores by 2015 -- he sees the future clearly. Diane will make sure he doesn't grow the business beyond their means. Or he will take her along on one exciting ride.

That's the Hennellys. And that's The Tire Choice, the 67th largest dealership on Modern Tire Dealer's Top 100 Domestic Independent Tire Store Chains list. (See the list in our Research area under 2007 Charts and Statistics.)

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Rapid growth

Hennelly Tire & Auto Inc. does business as The Tire Choice & Total Car Care, one of the fastest growing dealerships in the United States. The 17-store, Fort Lauderdale, Fla.-based chain has grown steadily since May 21, 2004, when the Hennellys opened their first five stores on the same day.

"It was crazy, hectic and fun," says Dan.

"I was excited and actually relieved," says Diane. "We were on our own and confident."

Prior to the grand opening, they developed one-, three- and five-year goals. Their five-year goal was 35 stores; by the end of this year, they hope to be running 21 outlets, which would be 320% growth in two-and-a-half years.

Some stores have been built from the ground up. Others were acquired. All are located in affluent or "emerging" markets.

"Acquisitions change the dynamics," says Dan. "You go after 10, you get two." The Hennellys have five deals in the works. "We'll see how that goes."

Profitability and control

Prior to opening The Tire Choice, the Hennellys owned four Tires Plus franchises. "I felt like we didn't own our own company," says Dan. "We had to follow Tires Plus rules, and they had to approve every store we opened. It just felt like we were working for Tires Plus."

To date, the company has grown "based on our profitability," says Dan. However, the business plan has speeded up to one new store every six weeks.

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"Sure, it concerns me," says Diane. "So far we have expanded with our own capital, and haven't had to borrow. We know opening up stores every six weeks is going to change everything."

She says they will try to pay off their debts as soon as possible to remain in control of the operation.

"Growing at the pace we are, some type of control and uniformity is needed."

The same goes for store managers. Dan says the "seasoned" managers are empowered to make a lot of their own decisions. "The new ones we are developing, we have to control a little more." For their efforts, the store managers receive "a large percentage of the stores' profits."

The company's growth also has necessitated district managers. "We try to develop the best students into teachers," says Dan.

Exceeding expectations

"We at The Tire Choice & Total Car Care would like to thank you for your most recent visit to our store," says the flyer. "We hope we exceeded your expectation. This is our company's number one goal at The Tire Choice."

The VIP coupons attached to the flyer are good for a $14.99 Kendall oil change and 10% off any automotive repair.

"We mail out a (hand-addressed) 'Thank you' letter the same day (the customers) are here," says Bobby Addino, store manager of the New Tampa outlet. "We send out the flyer the next day, and we do a courtesy call-back every day or two." It's the same for all the stores, he adds.

The Tire Choice sells Michelin, Pirelli, Bridgestone, Falken, Continental, Goodyear, Uniroyal, BFGoodrich, Riken and Yokohama tires. It guarantees "the lowest tire prices on all major brands," and backs that up with a 200% price guarantee. It also is an American Car Care Centers dealer.

ASE-certified technicians handle under-car service, "preventive maintenance" tune-ups, coolant system flushes and batteries. Tire service includes nitrogen tire inflation (at $10 a tire) and free flat repair.

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The Hennellys make sure everyone knows what they offer. They spend $100,000 a month on advertising. They prefer direct mail, cable television and database marketing. They also offer promotions on www.thetirechoice.com.

"The reason we've been successful is not because we have new buildings, because we do; not because we have state-of-the-art equipment, which we do. It's because of the people that we have."

Learning curve: The Hennellys are franchise-wise

"I can tell you I was scared when we opened our first franchise," says Dan Hennelly, chairman and CEO of Hennelly Tire & Auto Inc. in Fort Lauderdale, Fla. "I didn't know anything about running my own retail store."

Hennelly, who was president of Morgan Tire & Auto Inc. prior to opening a Tires Plus franchise, and his wife, Diane, figured out what they needed to know quickly, however. Important lessons learned included how to:

* organize the back office.

* form banking relationships.

* garner support from suppliers.

* handle national accounts.

Setting the stage for their growth with The Tire Choice, they also set up processes for the stores to follow.

Dan says his initial retailing experiences gave them more than the confidence to go out on their own. They financed their The Tire Choice & Total Car Care chain by selling their four franchises.

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