After two years of virtual meetings and events, K&M Tire hosted its 2022 Dealer Conference & Trade Show in person from Feb. 17-19 at the Sheraton Overland Park Hotel at the Convention Center in Kansas City, Kansas. Hundreds of dealers and their families trekked to K.C. not only for quality time together with K&M but also for educational sessions that centered around this year’s conference theme of “Pursuing Excellence.”
Check out our full coverage of this year’s conference and sessions below.
Trends in the Ag Tire Industry
To kick off the K&M Tire Dealer Conference & Trade Show, Loudan Hammersmith, K&M’s national ag sales manager, spoke about agriculture (ag) tire trends and how they will affect tire dealers in the years to come.
“When I think of the ag tire industry, I think of [my grandfather’s] John Deere 3010,” said Hammersmith. The ag tire industry is evolving though – making his grandfather’s old 1960 John Deer more of a “hobbyist” vehicle, he said.
“There have been production improvements in seed fertilizer, new technology in the farming economy, and we’ve also seen massive, massive changes in tractors in the [technology] department,” Hammersmith said. “From 1980 to 1990, we started seeing front wheel assist tractors, tractors with cabs; they got a little bit bigger, able to pull some bigger equipment. By 2000, we [saw an improvement to] horsepower and bigger tires to come along with it. Now, in 2022, we are starting to see high-speed tractors.”
Hammersmith also spoke about load index and how there are many more options today than in the past. According to Hammersmith, load index impacts the performance of an ag tire, and understanding it as a tire dealer is important. Having too much weight could put too much stress on ag tires, affecting their performance and durability over time.
Hammersmith also said that OE tires may not be good enough for ag vehicles, especially if they have to haul a lot of weight.
Other options for tires that can be an upgrade over OE ag tires are improved flexion (IF), very high flexion (VF) or cyclic field operations (CFO), he explained. Among the benefits over OE tires, he said, “IF tires can carry 20% more load at the same inflation pressure. Or, you can lower the air pressure to carry the same load. On a standard radial tire, a VF can carry 40% more load. And if you lower the air pressure by 40%, you can carry the same load as that standard tire. On a CFO, they can carry 30% more load during cycling field operations.”
To wrap his presentation, Hammersmith gave IF/VF benefit examples for use on an ag tractor like a John Deere 8530. If the tractor has IF or VF tires going about 4.6 mph while pulling a 21-ft. disk ripper, Hammersmith says the tires would allow for a 4% less reduction in fuel consumption – saving customers 0.64 gallons/hours.
Trends in the Commercial Tire Industry
Gary Schroeder, Cooper Tire executive director of global truck & bus tires, provided an update on four commercial tire topics dealers should bring back to their businesses to get ahead of the competition. One of those includes the increase in infrastructure spending.
“There’s a lot of spend now, and it’s all about just moving goods. That means more money is spent on trucks, and that means they’re going to burn through tires quicker,” he said. “And that means we’re going to see more demand for our products out there.”
We have a lot more details on this presentation, too. To read more about other trends influencing commercial tire dealer businesses, click here.
Vendor Trade Show & Prizes
K&M’s vendor partners met with dealers to talk products, pricing and orders during the trade show portion of the show. Dealers who met certain sales goals were also entered to win prizes or compete for cash from various manufacturers.
Pursuing a Culture of Excellence
To kick off Day 2 of the conference, Chip Madera, motivational speaker and self-proclaimed “Leadership Lion,” gave dealers tools for creating a culture of excellence in their businesses.
He used examples of high-quality brands, such as Disney, Zappos and Southwest Airlines, to demonstrate how a well-run, customer service business operates. “You have something in common with these brands,” Madera said. “Like them, you want to make money and sustain growth for some time. They do the same things you seek out to do every day.” So, how do they do it?
Madera used Zappos as an example of a company that creates a culture of excellence. Zappos brings its new employees together for a week of training where they focus on the company’s mission, vision and values for employees to become “Zappofied,” he said. At the end of that week, employees are offered payment for the amount of time worked plus a $2,000 bonus. However, most employees don’t take this offer, he said.
“They focus on creating a culture with commonly shared values and beliefs,” Madera said of Zappos. “They get every single employee on their team believing in who they are.”
“Your employees should know what matters to you,” he continued. Culture, Madera said, is like a behavioral control system. He described it as, “It’s what I say and how I say it. It’s what I do and how I do it.”
Madera also gave leadership advice, based on a high-quality customer experience he had at a Cracker Barrel restaurant. At this location, he said management gets together three times per day and tells employees, “there is no compromise on excellence.” He says that kind of commitment and focus to a mission each day will shorten the timeline on creating a culture of excellence.
“You must put on that leadership mindset of this is how we’re going to win today, and this is how we’re going to do it.”
What EV Trends Should Tire Dealers Be Ready For?
Electric vehicles might make up only a sliver of the market, but are they coming to a tire and service shop near you? And if so, when?
If you ask John Barclay, training manager for AVI OnDemand, tire dealers need to be ready for all-electric vehicles even if they haven’t seen them in their bays yet. And he’s not just talking about folks on the west coast.
“If you’re still in the camp of ‘I don’t need to worry about this stuff,’ how old are you? How much longer do you think you’re going to be in this business? Realistically, California is pinning 2035 for no gas, no diesel in passenger vehicles,” Barclay said during his seminar titled “Electrification of the Automotive Industry” during the K&M Conference. “Now, there are a few years to go, but I’m not sure how this translates to all of the states. I live in the state of Pennsylvania; we subscribe to California emissions. A lot of the states around me do, too. I don’t know what this means for me in my state when I go to buy a 2035 or 2036 model year vehicle. I imagine right now Pennsylvania doesn’t even know.”
Many big-name OEMs have already made big EV promises. GM has announced its fleet will be converted to electric by 2035. Ford is investing big money in EV technology, releasing popular models such as the Ford F-150 Lightning and the Mustang Mach-E. Mercedes says it will have an electric version of every car by 2022, and BMW will have 12 electric car models by 2025.
All this being the case, Barclay said for many tire dealers, hybrid vehicles are likely to show up in their shops, but only short-term, before many all-electric vehicles do.
“If we’re playing the odds, odds are that you’re going to see total EVs in your shop very soon. If you’re seeing hybrids, it’s just a stop-gap,” he said. “Hybrids started showing up because we didn’t have the technology to make an electric vehicle work the way we wanted it to.”
From the perspective of shop tools, he said many tire dealers likely already have many of what they need. However, one of the most important tools dealers can have in their bays for these vehicles are high voltage gloves.
Barclay said he believes one of the difficult shop shifts that comes with EVs is finding competent technicians who are willing to work with electricity.
“Talking electrical repairs, one of the most difficult things is to find technicians that are competent who want to work on these systems. There are a lot of folks who struggle with it,” he said.
Barclay warned that EVs have far fewer moving parts than internal combustion engine vehicles, an average of 21 moving parts for many EVs and 17 in Teslas. However, he said tire dealers shouldn’t shy away from welcoming EVs in their shops simply because they seem dangerous, or they don’t yet see opportunities for profit.
“If today we were trying to sell you on gasoline, if we were a diesel world and gasoline was brand new, can you imagine the signs? Not in my neighborhood. Think in the movies where the fuel station explodes. Those would be playing on the news all the time,” he said. “You can hate the electric world all day long. Hate it all you want, but it’s coming, and I would argue that it’s here.”
The 5 P’s of Excellence
In continuing the conference’s theme, Jeff Wallick, K&M Tire’s director of training and development, presented on the five “P’s” of excellence, which include perseverance, profit, people, processes and products. Wallick presented ways in which tire dealers can pursue excellence in each category and how K&M Tire helps them do just that.
In terms of profit, Wallick said plenty of profit can be found in services many tire dealers are already offering, including tire warranties vehicle flushes and tire programs. He said K&M administers 22 associate dealer programs to its dealers. “There’s a lot of money tied up in those programs,” Wallick said. “The question is, “What will you do about it? What makes sense for your business?”
Wallick also encouraged dealers to take care of their people by “upskilling” their workforce or giving the proper training on a frequent basis to employees. He said K&M offers training from the Tire Industry Association, NAPA, the Telephone Doctor and its other suppliers to keep its dealers’ staff trained up
Processes and products were the last two P’s of Excellence Wallick discussed. He encouraged dealers to look at the underlying processes that drive their business and see if there are ways to make these processes more convenient for employees and customers. For example, he suggested dealers evaluate the way their shop asks for reviews (if they do) and how they incentivize customers to return to the business.
Despite supply issues, Wallick emphasized how dealers can win by simply having the right products. He mentioned how dealers should be paying attention to trends in their local markets and overall in the industry, such as the rise of CUVs. With supply issues, he asked dealers to take a look at their inventory to see if they have the right product for the most common vehicles they see in their bays. One way to evaluate this, he said, is to work with K&M’s vendors to optimize their product screen and analyze data on the popular tire sizes in their markets.