Excerpt: "The three-year ownership mentality has crumbled," says Trevor Traina, founder of DriverSide, a Web site that helps people keep up with car maintenance and avoid overpaying for repairs. As new-car sales declined sharply, several sites like DriverSide and RepairPal have cropped up to cater to drivers who are keeping their old cars in shape instead of buying new ones...
The automotive aftermarket is taking advantage of the upkeep trend. Blue Magic, a maker of leather-care products and cleaners -- what are known in the industry as "appearance chemicals" -- just increased its line to eight products from three a year ago, says spokesman Jeff Schell.
Source: http://online.wsj.com/article/SB123188569970778793.html?mod=googlenews_wsj
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Excerpt: Tighter money also is changing how owners regard their vehicles. In the days of short-term leases and regular trade-ins, cars were basically "throw-away vehicles," said Stan Rodman, executive director of the Automotive Body Parts Association, a Houston-based alliance of 140 independent part-makers. Now, Rodman said, owners are recognizing the value of long-term ownership and are ponying up for repair costs, at least required ones. The change isn't so clear on maintenance, but prudent owners are doing more of that, too, he said…
At the same time, sales of used vehicle parts are up, said Igor Zhurya of Carolina Auto Salvage in Rock Hill. Big-ticket items such as engines and transmissions, Zhurya said, are a big reason his January sales topped last year's by 16 percent.
Source: http://www.heraldonline.com/106/story/1139984.html
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Excerpt: “If you go back 25 years ago, you could go to one manufacturer that made 95% of what you needed.” Sourcing from a single supplier also yielded pricing advantages, he says. “You really can’t go to one source that can fill everything you need anymore because nobody wants to manufacture all the different kinds of tires. You have to buy from multiple sources. And then to have the advantage in pricing that a private or associate brand would have over a house brand, you have to buy it better. Most of the time that means you have to buy containers. You have to be a volume-type buyer.”…
“The domestic manufacturers have really changed their philosophy. If they can’t get up to 100% production, they shut down their factories. What happens when they do that, of course, is that more production goes overseas. “Manufacturers in China and other places in the world are doing the same thing we did 20 or 30 years ago, which is to try to run their factories at 100% capacity and then try to sell out their capacity.”
Source: http://www.moderntiredealer.com/Article/Story/2009/05/What-does-the-future-hold-for-private-brands.aspx
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Excerpt: While the economy begins to show some signs of a recovery, including modest gains in consumer confidence, the auto industry continues to struggle as sales remain at historic lows. As more and more car and truck owners opt to keep their vehicles longer than originally planned, the need for auto service has grown. Among the many things that need to be replaced on an aging car are its tires. To quantify the business ramifications of this trend, Compete analyzed consumer behavior on the top tire sites as well as the search behavior of consumers that contributed to site visits…
The primary destination site for Goodyear visitors is goodyeardealers.com and for Bridgestone it’s firestonecompleteautocare.com. Retailer destination sites for the other two, Michelin and BFGoodrich, are spread out between Tire Rack, Discount Tire, Sears (SHLD), Wal-Mart (WMT) and Costco (COST). Goodyear and Bridgestone appear to do a better job of keeping customers engaged with their brand. The ability of Goodyear and Bridgestone to drive traffic to their own retailers may mean a greater potential for driving tire sales.
Both tire manufacturers need to maximize that potential by turning that opportunity into sales while Michelin and BFGoodrich need to understand how they can more effectively drive online shoppers to remain focused on their brands. Evaluating consumer online shopping behavior is always critical but it’s especially important now as the economy begins to slowly recover. As it recovers, consumers may buy fewer replacement tires.
On the other hand, there may be a bank of consumers that have even postponed tire purchases and who will re-enter the market. Staying on top of consumer behavior dynamics is the best way to effectively manage your marketing strategy and drive sales.
Source: http://seekingalpha.com/article/137507-do-online-strategies-drive-tire-prospects
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Excerpt: Despite the recession, the owners of some Indiana auto service shops say business is pretty good -- apparently because many people are too cash-strapped to buy new cars. As the recession forces many people to hang onto older cars rather than buying new ones, it means more trips to the service center to keep those older cars running, said Kyle Hoss, manager at Hoss's Automotive and Tire in Marion.
"People now are getting cars fixed instead of buying new ones," Hoss said… But she said people aren't doing as much preventative maintenance work to vehicles as they might during more typical economic times. "Right now, we're seeing the work necessary to get people back and forth to work," he said.
Source: http://www.chicagotribune.com/news/chi-ap-in-autoshops-economy,0,5555896.story
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Excerpt: RNR is also the 22nd largest tire dealer in the U.S. and that standing could continue to improve as more and more retail tire customers find themselves with reduced or cut-off credit lines, said Larry Sutton, founder and CEO of RNR. That passenger tire market helped 23 Rent-n-Roll stores cross the million dollar mark last year in spite of skyrocketing gas prices and the worst U.S. economic crisis since the Great Depression…
"The reality is, this economy is better for rental business than anything else," Sutton said. "Some guys that may have bought wheels retail in the past may be in a credit crunch and unable to do it that way anymore, but their desire doesn't change. How they get those wheels will change and that's where we come in."
Source: http://www.rtohq.org/01968apro-rnr-celebrates-gains-eyes-new-opportunities-at-annual-franchise-meeting.html
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Excerpt: The concept: people who can’t lay down $2,000 to buy flashy rims and tires can rent to own them over 12 months. It’s similar to Aaron’s rent-to-own stores where beds, sofas and TVs can be purchased over time…
One problem the chain has faced is that once a customer buys a set of rims, the customer doesn’t come back. Butler is trying to give them a reason to keep checking in. David Magee, a retail analyst for the capital markets division of SunTrust Robinson Humphrey in Atlanta, said that RIMCO, as a concept, should continue to be tested. He doesn’t want to see it cut into Aaron’s core customer base, or stretch Aaron’s customers too thin financially.
“The customer has got a very limited pay check and they don’t have other types of credit per se, so it’s a very finite wallet,” said Magee, who explained that Aaron’s and RIMCO largely have the same customer base. “The danger is they don’t want to overburden their customers with credit. It’s a little bit of a fine line.
Source: http://www.ajc.com/wireless/content/business/stories/2008/08/30/aaron_rents_rims.html?cxntlid=inform_sr
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Excerpt: O’Shea, owner of area tire dealer Adirondack Tire Centers, says he’s not worried. Revenue and gross margins are holding steady in the soft economy, O’Shea said, because his company’s services are not optional for consumers. “There are ‘want-to’ purchases and ‘have-to’ purchases. Our business is a ‘have-to,’ ” said O’Shea, 53…
O’Shea’s company, which turns 30 this month, performs wholesale, commercial and retail sales of tires and auto parts. All 11 stores have on-site mechanics who perform oil changes and diagnostic checks. “Years and years ago, a lot of tire shops could get by with just doing tires. You can’t any longer,” he said. “You have to maximize your square footage to make money.”…
But the economy has given O’Shea more leverage with tire manufacturers straining to maintain sales. “When times are good, there’s no negotiation whatsoever,” O’Shea said. “But now, the manufacturers can’t afford to lose any business at all.”
Source: http://albany.bizjournals.com/albany/stories/2009/02/23/focus4.html
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Excerpt: Don’t Cut Marketing – Increase It. When the economy slows down, the first thing businesspeople often do is to cut their marketing budget for items such as advertising, direct mail pieces and public relations. But, what they are really doing is making it much harder to reach critical customers. For example, “Many trade publications, websites, newspapers and radio and television stations are willing to deal right now when it comes to advertising,” said TIA Director of Marketing Communications Richard Porter.
“As business slows down, you need to work harder to reach customers in order to generate sales. Cutting your marketing expenditures only makes that effort much more difficult.” Invest in Training. With the battle for customer dollars getting even fiercer, businesspeople need every weapon in their arsenal to stay ahead of the competition. One way to achieve this is by investing in training.
"Investing in education for your service teams, as well as your salespeople places a value in front of your customer many of your competitors may not have. This same education also places value in you as an employer. In today's environment, employees tend to look at education as a sign that their company cares about them. On top of that, if you are unfortunately involved in litigation over an injury or other liability, the first thing the plaintiff's attorney will look at is training," said Jerry Lott, loss prevention manager of TIA member GCR Truck Tire Centers in Austin, TX.
Source: http://www.tireindustry.org/pdf/news_archives/pressrelease020609.pdf
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