Article
WHOLESALE TYRE SUPPLIER IN SOUTH AFRICA
2023-01-26
By Liana Shaw. Interview originally featured in SA Treads.
In 2012 Georg Schramm took up an opportunity to become the exclusive distributor to the American-based Cooper 4×4 tyre brand – now part of the Goodyear stable.
Due to his long involvement with the manufacturing sector, in particular, Dunlop, which at the time had the rights to distribute Cooper in South Africa, Schramm had gained first-hand knowledge of the brand and its unique off-road capabilities.
Fast-forward to 2022. Georg and his team have grown the business – which now trades under Tyrelife Solutions – to include a complete range of 4×4, SUV and passenger-car products including Mickey Thompson, Momo and Dirty Life Wheels, to name a few.
So, how did they get here and what is next for this dynamic business that has set its sights squarely on providing a superior, if not unorthodox, service offering to the dealer trade and consumer?
We spoke with Georg to get the lowdown.
Tell us more about the products and solutions you offer
Aside from the two premium brands, Cooper and Mickey Thompson, we now also offer the Terrafirma and Patriot range of tyres, which provide the cash-strapped consumer with a great alternative from a price standpoint.
Where are these brands made, and what recourse does the consumer have in the event of a claim?
The Patriot tyre brand is made in Thailand, while Terrafirma is a private brand developed in Australia and manufactured in China. We have gone to great lengths to source brands that are credible and fit for South African conditions and can therefore sell these products with complete confidence.All our products are sold with a manufacturing and protection plan warranty against road hazards, thereby providing the consumer with peace of mind.
Think of this as a tyre-based ‘motor plan’ designed to assist consumers with the maintenance of their tyres – no different to their vehicle. This benefits the consumer, who will increase the life of their tyres while simultaneously benefitting the dealer, who extracts value from the after-sale service.
In the event of a problem, the dealer and Tyrelife Solution are there to assist. On our premium ranges, we also run a mileage plan for every set of passenger, light truck or 4×4 product, which runs on a c.p.k (cents per kilometre) basis.
This is a market-first, as far as I'm aware. How exciting!
Yes, indeed. Various companies have successfully run c.p.k programmes in the truck-tyre sector. Incorporating a similar programme into TyreLife's value offering has played a key role in customer retention and growth.
We believe you have a unique way of supplying your products to the dealers. Tell us about that.
If there's one positive outcome to the recent pandemic, it would be the growth of the Digital Age and how dramatically it has changed the way business is conducted. It has enabled us to maintain contact with customers and service providers virtually.
That said, we've been actively establishing an innovative approach to tyre distribution by creating a digital platform through which dealers and customers can source the right product and fitment partner in their area.
Equally, they can obtain the right information concerning tyre size, technology, and application.
Few consumers realise that a tyre is a safety-critical component. As an industry, we are responsible to the motoring public to ensure quality products are correctly specified for the vehicle and application.
Coming from a manufacturing and technical background, we see ourselves as complementing our knowledge with the dealer and stimulating a value proposition ahead of price.
So how would a prospective dealer go about joining your programme?
First, let me reiterate, “we are not competing with retail.” We are offering retailers the opportunity to supply a service for early adopters who want to purchase online with a group that is growing.
Due to the high development and marketing costs, this sector is difficult for dealers to reach independently. However, by partnering with TyreLife Solutions, dealers are catering to this tech-savvy group without making the development investment.
We are a complementary wholesaler that distributes products and value-added services to the trade and consumer while providing knowledge for a highly specialised market that commands specific skills and know-how in tyre construction, weight and application.
Dealers are required to sign a Service Level Agreement. There are a few criteria for signing an SLA, which are based on a dealer’s ability to deliver the service needed for a successful fitment. This does not hinder them from selling opposition products.
We have signed up many forward-thinking dealerships and can offer consumers a national network of fitment centres when buying online.
All business is transacted via our online platform. Best of all, once a consumer has selected his tyre of choice and where he would like to have the tyres fitted, the dealer is paid both a tyre margin and reimbursed the entire service fee. This rewards the dealer for the level of service delivered.
The business model is simple, and dealers who collaborate with us profit without holding unrealistic stock values and tying up working capital. We aim to drive as many consumers as possible to premium retail stores.
We do not undercut our products or services. We aim to close the knowledge gap from a consumer interface point of view, taking them from start to finish so they understand the importance of fitting the correct tyre onto their vehicle.
The Digital Age has seen consumers become savvy in their purchases as they now access a wealth of information via the internet. In short, the dealers we have partnered with are entrepreneurs offering highly specialised services.
I have visited your online platform, and it seems easy to navigate. Have you come up against any resistance from dealers unfamiliar with this concept?
In the beginning, yes, and this was to be expected in an industry in real change, but whether we like it or not, Digitalisation is here to stay, and it is not the enemy!
As you correctly pointed out, the system is simple and easy to navigate. It works well and ensures that the consumers’ needs are met while also ensuring the dealer stays profitable.
Business is responding to the evolving need to change the business model and provide new revenue and value-producing opportunities.
Mobile communication has dramatically accelerated a customer’s ability to explore options which would result in either an online facilitated sale or a dealer direct sale. This is the first phase in the new digital world, and it is here to stay. Now is the time to embrace it, particularly as we need to appeal to a tech-savvy generation.
Dealers can also purchase tyres via the dealer portal, where stock, prices and delivery times are specific for each dealer, providing more accurate and immediate information than ever. Let me reiterate: TyreLife Solutions' business-to-business approach is paramount because we could not do this without the tyre retailer.
In short, Tyrelife Solutions are referral partners to the trade. We refer to ourselves as their ‘Silent Salesmen’ because this, in effect, is what we are.
Going back to the widespread practice of selling on price, how do you believe the industry can turn this round?
The only way would be through the introduction of regulations which adequately protect consumers from the illicit traders out there who have little or no regard for what we stand for. Traders are encountering different business challenges without formal regulations.
This is counter-productive for the industry and equally harmful for the consumer, who may not be supplied with the right tyre for their application, and there is an alarming trend illustrating this.
Traditionally, the tyre business is regarded as a low-skills industry, with low salary barriers for tyre fitters and sales personnel, creating an environment that has led to "job hopping" and poor staff retention.
This needs to change and will only be achieved through ongoing investment in the development of people in the store and with ongoing tyre and fitment knowledge. TyreLife Solutions can assist with this development, which will be rolled out in our industry next year.
What is next for Tyrelife Solutions?
Until recently, we have concentrated exclusively on the 4×4 and light truck market, but this is about to change. Dealers are asking for a complete range of products. We are finalising a complete tyre, wheel and accessory offer designed specifically to cater for all product and price segments on a good, better and best basis.These quality brands will complement our existing product range and extend our range to cater to all product segments. In 2023 Tyrelife Solutions will supply the full spectrum of products to meet consumer and retailer requirements.
Moreover, we are now a growing distributor of 4×4/SUV wheels in South Africa with the exclusivity of Momo wheels for passenger vehicles and the backing of The Wheel Group (TWG) with brands such as Dirty Life, ION, DWC, MT Metal and Dynamic Steel for the off-the-road sectors.
Wheels are a sexy but complicated business, elevating our desire to upskill dealer staff as few understand wheels and their significant role in the vehicle’s safety and performance.
As before, dealers across the country will have the chance to gain personal access to the Tyrelife Solutions ‘solution’ via a succession of road trips which will take place next year, and this will also raise brand awareness for our name and what we stand for.
Best of all, our flexible Digital Programme is now scalable, designed in such a way as to be able to grow and evolve at minimal additional cost. This is the way of the future, and we are excited to be able to provide a completely digital online solution to our customers.
Georg, your passion for the trade is evident. What type of legacy would you like to create for yourself?
I would love to see a greater level of dealer expertise in an industry which is changing rapidly to meet the demands of a carbon-neutral world. Training cannot be left solely at the manufacturers' feet. Their focus is manufacturing.With margin creep, it becomes difficult and costly to serve all retailers on the merits of tyre technology and retailing. TyreLife Solutions have a manufacturing DNA with a definitive focus on customers and their needs which should never be compromised.