All-Season Sales Simmer

Let’s face it: selling in the face of big discount competition is a tough row to hoe. Tires sales are primarily made on two criteria-price and application. Most independent tire dealers can’t compete with mass-merchandisers like Wal-Mart and Canadian Tire on low-price volume sales and most don’t bother trying. Successful dealers like Tina Johnston, manager of Fredericton Discount Tire Outlet in Fredericton, New Brunswick, can turn a price driven inquiry into a quality-based sale. Says Johnston, “About 50% of calls we get are driven by price, and around half of those calls want the cheapest price in town. But the other 25% will come up in price if you explain a bit about the tire and warranties, etc.”

Independent tire dealers across Canada report the average sale for a touring radial in a typical 205/70R15 size, ranges from $75 to $140 per tire-not the bottom end. That’s because they’re selling application, backed by experience and product-knowledge. And that kind of expertise, as dealers coast to coast will tell you, has a lot to do with the weather.

As they say in real estate, location is everything. Local conditions year to year impact sales of all-season versus winter tires. In and around Toronto, the all-season radial is still king, but the harsh winter this year has many southern Ontarians turning to winter tires, says Bruce Daley, owner of Daley’s Auto Service in Mississauga, Ontario. Daley says the new low-profile tires he sees get a lot of abuse when they’re changed seasonally, so he tries to sell those customers a wheel package.

British Columbia’s varied climate presents unique challenges for tire sales. Martin MacCarthy, manager of Richmond Country Tireland Ltd. in Richmond, B.C., says all-season radials are the bulk of his sales, but not the whole story. “We do sell some snows, for people who go upcountry to the Okanagan, places like Chilliwack and the Hope area where they get a lot more snow than here in town. The climate in different regions plays a role in the sale.”

Johnston says 75% of her sales from October to January are winter tires. “There’s a lot of people in Fredericton that are winter tire people only, and if they’re not, we try to talk them into it. We could have anything from two feet of snow to black ice, you never know. The new ice radials are excellent with our type of weather. I run this type of tire myself and I wouldn’t lead them wrong.”

Weather has been a big factor in this year’s tire sales, says Steve Molinelli, assistant manager of OK Tire, Muffler & Brake in Saskatoon, Saskatchewan. “Last year we sold a lot of all-season close to winter. But this year was a big change. We had a couple of weeks of pretty bad snow early on. In October, we sold 498 winter tires in one week, and I’m still selling winter tires.”

For Molinelli, location means more than just weather. “There are different demographics in Saskatoon. Customers at our other location on the West side of town are looking for a bargain tire, whereas we’re seeing a lot of luxury cars and newer-type imports where customers want quality and the right traction.”

Where the rubber meets the modem

Tire dealers across Canada are noticing more and more of their customers are turning to the Internet before they make a tire purchase. They’ll see lots of rubber online, but will it help them find the right product? Dealers sometimes spend the first part of the sale debunking misinformation the customer has learned online, explains MacCarthy: “The Internet isn’t the most reliable source of information because a lot of consumer tests are done on closed circuit tracks. I had a customer about three months ago who bought tires based on the Internet and just hated the tires. They were the worst things he ever had, but he says they were the most highly rated tire out there. He ended up buying different ones from me and taking those ones back.”

Johnston says the Internet has become the most common source of tire information for her customers, who walk in or call ahead asking about the latest model they’ve seen online. She makes it work for her by using this as a starting point for selling her own products. Says Johnston, “This year Michelin had a brand new ice radial out and people are wondering what these new ones they’ve seen on the Internet are like. I explain the siping that basically all the new winter tires and ice radials have for icy conditions. When you go to the Internet it has the size and what’s best for your car, so they have an idea of what they want. We can start there.”

Dealers who sell brands that don’t advertise nationally have another issue to contend with-television. Ask people on the street to identify tire brands, and they’re likely to come up with two or three major names that they’ve seen on TV, from the deep pocket manufacturers who blitz the airwaves. Daley, who sells Cooper’s Dean brand tires, is skeptical about big budget ads and specials his customers quote in his store. “Michelin has a good name but they also have a high advertising budget and that’s all people seem to know. Or they come in and say, ‘If I buy two tires I can get the second one at half price’. Well, that just boils down to them paying full list on everything.”

Daley says his customers are often amazed when they realize they actually have options. He recently put a happy MINI driver on a set of four tires for $900 after his BMW dealer quoted him $1600 for a comparable product. Being independent-selling the tires he wants with low overheads, gives Daley an edge.

Successful independent tire dealers coast to coast have a similar philosophy. They don’t focus on the upsell as much as the application. The cheapest of the cheap rubber they leave to Big Box retailers like Wal-Mart. For their customers, they find the right tire for their needs, be it new or used mid-range rubber or high-end touring tires. It’s a business built on reputation, and they’re not afraid to put it to the test.

Molinelli lets his customers take his own car out for a spin to demonstrate the benefits of good rubber. Johnston promotes tires she runs herself, the most useful consumer test for the Fredericton climate.

The bottom line, says Dale, is about selling customers the right tire, not the ‘right’ brand. “Everybody’s application is different. I work with them and we choose the right tire, I don’t try to promote anything. I make a sale, not a killing.”