Quiet, unassuming, close-to-the-vest, Larry Enders is a perfect fit with Cooper Tire & Rubber Co. Now president of Cooper’s recently formed commercial tire division, the 38-year Standard Products veteran and former head of Oliver Retreading Systems sat down with Tire Review in his Findlay, Ohio, office to talk about how his division is going to market, and how the recent acquisition of Hercules’ retreading operations will impact business.
With the integration of Oliver and the recent purchase of Hercules’ retreading business, talk about new tire products and what Cooper’s plan is for going to the market with a cradle-to-grave approach.
Enders – Our primary focus is on the replacement tire area, where Cooper has had products for some time. It’s our intent to continue focusing on the replacement market, on independent dealers, and to expand with products that are more focused on regional and local fleet needs – those applications and types of 20-50 tractor fleets that a lot of our dealers already have relations with.
Are you looking to move beyond regional and local fleets?
Enders – I think our focus will be on regional and local fleets and those types of applications. We’re looking to expand our product line with what we call Ôall-purpose’ types of products for the P&D market, those that are in at more local-use type applications.
Cooper has never been very aggressive about promoting its truck tire products and competing against second or third tier brands. Is this something that’s going to change now that Cooper has a new-retread system approach?
Enders – That was one of the purposes of setting up the commercial division. The acquisition of Oliver allows us to give a little bit more focus on the commercial side of the business. The company has always focused more heavily on passenger and light truck, and we needed to provide some leadership and focus on the commercial area. We’ve always had some capacity constraints in the past, but we did increase our production capacity in Albany, Ga., last year and are in a better position to market and broaden the line.
Are you going to pursue anything with regard to truckstop distribution?
Enders – We’re looking into truckstop distribution. That’s within the marketing program we’re working on. We don’t have anything definite there, but we’re looking at that opportunity.
The marketing plan you mentioned, is that something that’s still being worked out?
Enders – We know the basis of it. The details of the plan still have to be worked out. But our strategy is to expand our product offering to focus more towards regional and local applications, and work with independent dealers. We’re going to match that up with the retreading side because we see that retreads sell new tires and new tires sell retreads.
Losing Treadco as a customer was pretty substantial. What have you done to pick up new customers to replace that business?
Enders – I think the whole marketplace has been in a very dynamic position in the last five years, with a lot of consolidations and mergers. We were disappointed with the loss of Treadco, but we feel the reputation that Oliver has, the national programs we have, are the same things that will help us grow our business in the future. The market has been more dynamic in the last two years, giving us more opportunities to sign up new dealers. We had a very successful year in 2000 signing up new dealers, compared with previous years where there was little movement in dealers looking for suppliers. So far this year we’ve seen it continuing, and we’ve signed up some additional dealers since the first of the year.
Oliver is producing tread stock for MRTI®€ƒ
Enders – We’re pressing precure tread stock for MRTI.
Is that something you hope will continue and expand?
Enders – I think the business relationship with Michelin has been successful, and we plan on continuing that.
Is there a long-term goal for where that can go?
Enders – It’s a unique relationship. It was not a short-term situation, so we plan to continue with the successful relationship that we have.
How difficult was the integration of Oliver into Cooper?
Enders – From the Oliver side it was quite easy. Strategically, both companies were focused on the same thing – quality products and independent dealers. We felt very comfortable being aligned with a company that had the same culture and focus.
We then looked at opportunities for synergies, and we took on the challenges of integrating our systems. Those tend to be more intense in trying to integrate. But I have to report that we’ve completed that integration. And the new system is better for the customer than anything we had previously.
What is it going to take for Cooper to be satisfied with what’s it’s doing on the commercial side of the business?
Enders – All companies have measurable goals that they look at for any segment of their business. And responsible corporations look at return on invested capital as one of those measurables. Those are always measurables that will always determine how successful you are in running the business.
You already have some relationships with regional and local fleets, but you’re going to need more of them to grow from where you are. What’s your sales pitch to these fleets?
Enders – I think we have the product, both in new tires and retread products. We have high quality products, and both Cooper and Oliver have strong reputations. And we have competitive marketing programs available, which Oliver introduced over the last seven to eight years.
When I talk about competitive programs, I’m talking about fleet programs like national billing and warranty programs. And we have analysis and survey programs to help fleets reduce their tire costs. We have all the tools in place to help our dealers work with end-users and provide that extra value. We have talents within this company to add that extra value, so we can work with dealers to go to the end-user and help take down their overall tire costs.
Truck and trailer manufacturers want to control more of the cradle-to-grave relationship they have with suppliers. Do you see Cooper trying to increase your level of recognition at OE?
Enders – That will be done on a selective basis. Our real strategy right now is in the replacement market. I recognize your comments about the OEs and in trying to maintain that wheel position throughout the life of the vehicle, but that’s not always the case.
What we see in the industry is the service the dealer provides to the end-users is what is very important. With our programs, working with dealers, educating the dealers, helping them understand fleet needs, and giving them the tools and training to do that, we feel the Cooper and Oliver products will fit into that.
How many retreader dealers do you have right now?
Enders – Probably over 300, of all shapes and sizes. Oliver is a full-service supplier, so we supply everything for passenger all the way up to OTR retreaders. In the commercial truck area we have dealers who are licensed Oliver dealers, and we have customers that buy our tread rubber for their mold cure operations.
The truck industry is down right now. Do you see this as a window of opportunity where you can position yourself and be prepared to make a push when things start growing again?
Enders – I guess the answer is yes on a couple of points. The integration of Cooper and Oliver started before the truck market went south. What the current situation does do for us is, as we finalize our integration and move to Findlay, it positions us very well. And the Hercules acquisition compliments what we’ve been doing. So, yes, I think we will have everything in order to be on the leading edge of that turnaround.
How long had you been working on the Hercules deal, and who initiated it?
Enders – Well, it didn’t happen overnight, but I can’t tell you how long. I think there was mutual interest on both sides. Hercules and Cooper have had a strong relationship over the years.
What has the reaction been from the Hercules dealers?
Enders – The initial reaction has been positive.
Five years time, where are you going to be?
Enders – Good question. I think that in five years you’ll see us as a key player in the retread side of the business. We’ll have a portion of the new commercial tire business, but we won’t necessarily be among the top three. But we’ll be recognized for quality products and service at fair prices. It goes back to the founding of Cooper: Good merchandise, fair trade and square deal.
