MTD Exclusive: How Les Schwab Looks at Acquisitions

Bend, Ore.-based Les Schwab Tire Centers Inc., one of the five largest independent tire dealerships in the United States, has acquired nearly 30 locations since June 2024 and expects to acquire more, Mike Broberg, the company’s CEO, recently told MTD.

In this exclusive, Broberg discusses Les Schwab Tire Centers’ acquisition strategy, the opportunities it sees and more.

MTD: Les Schwab Tire Centers has made a number of major acquisitions over the past several years. Why has the company chosen to grow its footprint via this method?

Broberg: We, of course, want to grow. We have a tremendous business. We are very fortunate to have a business that's built around treating employees and customers well and really built on the values that (founder) Les (Schwab) created and we want to continue to grow and provide opportunities for people and for customers and communities that we're not in today. We do that through same store sales growth, of course, but we also do that through new stores. We’re adding more new stores than we ever have in the past and yet we also recognize that acquisitions provide an opportunity for us to take care of a few different things. One, from our perspective, it allows us to move into certain markets faster than we otherwise would be able to. And two, there are people out there who are reaching a point in their careers where they're ready to make a change. Sometimes they have someone they can pass the business onto and other times they may not. Where they don’t have that opportunity, we can be a great opportunity for them to have a landing place for their employees and customers that’s very positive. So all of those things together really make for a great opportunity for us in terms of growth and continuing to move our business forward, while continuing to also take care of people, which is really core to who we are.

MTD: What does Les Schwab Tire Centers look for in a potential acquisition? Are there certain metrics you want to see?

Broberg: Certainly when we look at an acquisition, we look at the same things we evaluate ourselves on. There’s always the core metrics around sales and profitability and wanting to make sure the business is strong. However, we also look at how that business is doing with respect to their employees. We look at the tenure of their employees. We look at how efficient their workforce is. We look at the programs they have in place to take care of their employees. We look at their customers. We look at the tenure of their customers. We look at what services they’re providing to those customers. And all of that (is) to say, ‘How does this match with us?’ When we look at metrics, we’re trying to make sure it's not just values that somebody's talking about, but rather values that are actually being manifested in the outcomes of the business itself.

MTD: Are there other things that are important to Les Schwab Tire Centers when making an acquisition or even after making an acquisition?

Broberg: I suppose we could talk about location and those kinds of things, but in the end, the things we focus on are the same things we run our business with. We want to make sure when we’re doing an acquisition, it matches. Our brand is built on great customer service and the way that we treat people, so it’s just that much more important to us to make sure that if we're doing an acquisition that the people who come with that acquisition ... are going to match that same set of values we have. So we are selective. We are careful. We, of course, want to grow as fast as we can and as appropriately as we can and provide those opportunities, but we will be thoughtful and considerate about what that means, who we will be bringing on board and making sure it will be a good fit.

MTD: Les Schwab Tire Centers has allowed some of the tire dealerships it has have acquired to continue to operate under their existing names – sometimes even with existing staffing. What are the benefits of that strategy for the acquired property, for Les Schwab and for the customer?

Broberg: We kind of look at that on a case by case basis, whether or not we’ll continue to use the brand that's on the building that we acquired. In the case of CMC Tire... it’s a very good example of one where we kept that brand and that was really driven by the strength of that brand, especially around the commercial business they provide. (Editor’s note: Les Schwab Tire Centers acquired CMC Tire, which had 11 locations in Nevada, Colorado and Utah, in June 2024.) We evaluated them. We looked again at all the things I just mentioned. They were a great fit for us and they provide a focus on the commercial business and have a very strong reputation as it relates to those customers in the markets where they operate. And so we recognized that strength of their position and their brand and certainly wanted to make sure we took advantage of that. So we kept the brand for CMC.

We did the same thing with Pete's Road Service in southern California – also a commercial-focused business. (Editor’s note: Les Schwab Tire Centers acquired Pete’s Road Service, a commercial tire dealership with 10 stores, plus a retread plant and a distribution center, in February 2025.) So (with) the two of them... it made a lot of sense to take advantage of that. Others we convert immediately to Les Schwab if they’re operating in a way that’s consistent with our brand, as mentioned before. And in some cases, we may even have dual brands for a period of time, if it makes sense.

MTD: What opportunities for additional acquisitions do you see in the market, including longtime tire dealership owners who are looking to exit the business? You referred to that dynamic earlier...

Broberg: As you know, our industry is still very fragmented. We have a lot of players out there – some larger, some smaller – and we still have a very large number of founder- owned and operated businesses. We want to make sure we’re capturing opportunities where we can. It’s certainly a competitive landscape. We want to grow and take advantage of those opportunities, but do it thoughtfully.

Geographic location is meaningful for us. We do look at that. We want to make sure that if we acquire a business, it’s in a place we can appropriately get product to and take care of customers in that location and (take care of) employees. If there’s a single store in the Southeast, we may not be the right acquirer for that. But if it’s a significant brand that has a good base and a good brand, then we would certainly consider those kinds of acquisitions and maybe again, similar to CNC and Pete's, we hold onto a brand for a little bit longer or keep it. And those would certainly be viable acquisition opportunities for us. We’ve evaluated some of those in the past and will continue to do that going forward.

We are selective. At the same time, we know there are many opportunities for us out there. We look forward to those conversations with people. We’ve had conversations with them already and in some cases, people are ready to make a change. Others are looking a little bit farther down the road and want to talk with us about what that might look like when they do reach that point in time.

MTD: What’s your take on the climate for tire dealership M&A the rest of the year and into next year? What’s your forecast? What do you see and what do you anticipate?

Broberg: For sure, we would expect the current landscape of opportunities to remain in the coming years. We don’t expect everything to convert over to a smaller number of players in a short amount of time. There are aggregators, but also others who are looking at the tire business, recognize what a great business it is to be in and use acquisitions – or would like to use acquisitions– to be able to enter this industry. By the same token, I think businesses out there want to make sure they’re getting to a good landing spot. And we certainly want to be the kind of company that people recognize as being a good landing spot.