Les Schwab Looks to New Tires and New Markets With End of Toyo Agreement

Feb. 25, 2019

How will Les Schwab Tire Centers Inc.'s offerings and footprint change following the end of the retailer’s exclusive territory agreement with Toyo Tire USA Corp.? Dale Thompson, Les Schwab’s chief marketing officer, answered that question and others from Modern Tire Dealer.

MTD: Will you continue to sell Toyo tires?

Thompson: Les Schwab has always been committed to providing the best performing products to our customers no matter what price point or segment they are in.  Toyo tires have been a significant product offering for many years and we will continue to sell them in the segments when there is a benefit to our customers. We look forward to keeping a strong relationship with Toyo.

MTD: How will no longer having exclusivity affect your sales volumes for Toyo tires?

Thompson: As Les Schwab continues to evolve our tires selection to best meet our customers' specific needs, we aim to provide product continuity across current and future markets. This shift will decrease our sales volume with Toyo for passenger car tires.

MTD: What are your plans for selling/marketing manufacturer brand tires?

Thompson: At Les Schwab, our focus is on the customer and their driving needs.  Our product lineup is designed to deliver the best value and quality available across a range of applications. Manufacturer brand tires will remain an important part of our product mix.  

MTD: What are your plans for selling/marketing private label tires?

Thompson: People choose Les Schwab because they trust our service and our values. We only sell the highest quality products backed by our world-class service and warranties. Over more than 65 years, we’ve grown to be one of the largest tire retailers in the country, and in many cases we are able to leverage our sales volume with tire manufacturers to develop brands and products with performance attributes that specifically meet our customer’s requirements.  

About five years ago Les Schwab looked at ways to improve our product offerings to our customers while ensuring all of our current and future stores can focus on product performance for our customers, instead of nationally known brand placement and reputations. It has always been our focus to provide the best service and tire performance regardless of national brand recognition.  By designing our tires in cooperation with key manufacturing partners we continue to be able to give our customers excellent products, at fair prices.

MTD: What are Les Schwab’s plans for Toyo truck tires?

Thompson: The Toyo truck tire is a key part of our TBR business.  Toyo remains a component in our commercial product screen.   Our focus remains on providing the best solutions for our commercial customers.

MTD: Is the decision to terminate an exclusive territory agreement related to the changes in the wholesale market?

Thompson: The industry continues to evolve.  It always will.  We are in eight western states today and continue to expand our footprint.   Limited geographical exclusivity limits our ability to provide the best value for our customer.  With our focus on continued growth outside of the Pacific Northwest, we will remain nimble with a product screen focused on the customer’s needs in each market.  

MTD: Do you have anything to add?

Thompson: Toyo has been a valued business partner for more than 50 years.  Over those years the industry has changed and Les Schwab’s needs have changed.  Shifts in the distribution market, and Les Schwab's growing regional footprint, made our limited exclusivity with Toyo challenging in new markets. As a result, we've shifted our product strategy, and diversified our selection.

Following the termination of the agreement with Les Schwab, Toyo has become a preferred partner vendor with the Point S network of dealers. For details, see “Les Schwab No Longer Holds Exclusive Rights to Toyo in Northwest U.S.