For independent tire dealers, spiffs, exclusivity agreements, and marketing groupings provide significant benefits. But if you don’t prepare ahead, that hard-earned prosperity could vanish in an instant.
Our research indicates that 40% of tire dealers use supplier spiff programs to boost their bottom line. In a recent Rollin’ with the Numbers episode, we discussed spiff programs and clarified that, from the standpoint of a tire dealer, spiffs are advantageous incentives offered by manufacturers to enhance the promotion of specific tire brands. Dealers benefit from these incentives not only as an additional source of motivation but also as a chance to showcase their knowledge to potential clients, increasing their credibility and sales.
34% of those surveyed said they were linked to a brand by exclusivity agreements. This targeted collaboration provides marketing attention that improves inventory control and local branding. 33% of respondents claimed to be involved in marketing organizations, where they pool resources to support coordinated regional branding initiatives that increase consumer awareness. If these systems are that good, then why are only 33–40% of dealers using them, you might be asking yourself? The data hold the solution.
Among the reasons given by 14% of respondents for using their own tools for growth were better customer service, providing the greatest local value, and developing their own rewards systems. The financial health and market position of an independent dealer may be significantly impacted by these strategies.
All of the effort you put into creating your company could fall apart, though, if you don’t have a strong succession plan.
I was therefore a little worried to learn that 1 out of 6 respondents claimed they did not currently have a formal succession plan in place. By using tools like spiffs, exclusivity agreements, and marketing groups, 16% of our respondents run the risk of losing what they’ve worked so hard to build for their shop’s next generation of leadership. All of that development can really vanish tomorrow in the event of an unforeseen circumstance, or later on following a change in ownership without a plan for the future.
As you develop the succession plan for your own shop, keep in mind that the tire industry is changing quickly and that being proactive will help to ensure a smooth transition when the time comes. The future is impatient; if you don’t plan, you’re planning to fail.
Thus, while making the most of your current advantages is crucial, investing in a leadership plan for your shop is equally critical. This guarantees that the things you’ve created will benefit your community long after you’re gone.
We would love to talk to you! How do you aim to succeed? In what ways are you making use of resources to maintain your competitiveness going forward?