During TIA’s “Successful Tire Dealers Share Their Secrets” forum on Nov. 3, Jerry and Steve Nerheim of Waukegan Tire, the 2020 Tire Review Top Shop winner with three stores in the Chicagoland area, and Rodrigo Valle Hernandez, owner of Grupo Tersa in Mexico, Tire Business’s Tire Dealer Humanitarian Award winner, provided insights into their dealerships and what has kept them successful doing business in the shadow of the coronavirus pandemic, sharing key takeaways and strategies along the way.
The hour-long session, moderated by Kevin Rohlwing, TIA’s senior vice president of training, covered a range of other topics including business operations acumen, branding and marketing, employee recruitment and retention, training, service mix and selling strategies, and customer service with a focus on delivering an optimal service experience.
Chief among the panelists’ opening comments was the importance of forging solid relationships with tire manufacturers and suppliers, as a foundation to not only boost productivity and profitability, but to ensure customer satisfaction through service excellence and efficient repairs.
Steve Nerheim, Waukegan Tire vice president and COO, also highlighted the importance of cultivating a family environment at the company, where employees are nurtured, trained, appreciated and rewarded, which results in a committed, motivated employee base that encourages one another and works toward common goals.
“I’m so proud of our team and our employees are like family, and we just have an amazing relationship—we motivate one another and encourage one another and share a lot of ideas and thoughts. And, I’m just really proud of dad and all that he’s done and to be working alongside him for all these years,” he said. (Steve’s son Steffen also works in the business while attending college.)
Training is a priority for both companies which, because of the pandemic, has been mostly comprised of virtual meetings, small group sessions or participating in supplier training modules. New processes aside, Rodrigo stressed the importance of grabbing hold of this new reality within which we have to conduct business and achieve our goals, and “learning to work with these new challenges.”
Employee recruitment and retention is also a key component in remaining successful for these top shop owners as they wrestle with making the right decisions to fine-tune their business operations during the pandemic.
Jerry Nerheim, Waukegan Tire founder, president and CEO, said that the local community college’s auto tech program is a good source of techs for Waukegan, who are first trained on tire installation, then they move onto other duties like oil changes before they become B-level techs with added service responsibilities.
Rodrigo chimed in on the importance of having a solid, skilled team, who become ambassadors for your business. “If you hire the best, the best will follow you,” he advised.
Pandemic & Customer Expectations
With cleaning regimens and sanitation protocols in place to protect both employees and customers, all three panelists said that doing business during the pandemic puts one’s strength to the test. But those who possess resilience and tenacity can find opportunities among the hardships, they said.
As a means to offer “touchless” service, Rodrigo said that Grupo Tersa has been offering drop off and pick up valet service for its customers. Not only has it been well received, he said it’s a competitive advantage in his marketplace. He operates more than 150 stores, including 45 company-owned and three distribution centers in 26 different cities within seven Mexican states.
Jerry explained that offering mobile tire service at Waukegan Tire is a growing opportunity, especially during this unprecedented time that has altered consumer buying behaviors and boosted service expectations.
Rodrigo said it’s important to adjust one’s mindset while doing business during tough times, embracing the new reality of how business must be conducted and be organized so that your team can follow in your footsteps. Then, and only then, can the focus shift from challenges to opportunities, adding that his business has experienced double-digit growth over the last two months.
Waukegan Tire also is also reporting significant growth during these difficult times.
“Business is solid, and we have a line at the counter every day,” said Jerry. “Both new and repeat business; we are very blessed.”
Their team goes to great lengths to make their customers’ service experience a memorable one. Jerry noted they build a relationship with each customer and “help them make the best decision,” and show their appreciation for their business. Steve chimed in, saying “We provide a friendly and clean environment with amenities to make their time and experience more pleasant.”
In both dealerships’ favor are miles driven, which continues to increase among consumers who still have an aversion to flying and who continue to return to the office to conduct work.
Jerry also plans a steady focus on his business mix of both tires (68%) and service (32%). “Tires bring you service,” he said, adding that he sees additional growth for his business in the area of driveability and vehicle safety checks.
Rodrigo agreed with Jerry on the importance of offering both but plans to grow the service side of his business from the current 30% of his revenue to 40%, lured by the profit potential of better margins on selling parts and service.
Electric vehicle service is not on the horizon for Grupo Tersa, Rodrigo said, with there being no consumer incentives to buy EVs in Mexico. However, Jerry said Waukegan Tire currently services Teslas in its market through tire replacements and wheel alignments and feels there are more service opportunities to garner on EVs by offering electrical system service and battery replacements.
Both the Nerheims and Rodrigo emphasized the importance of community involvement and local events as a means to connect with customers—complemented by a heavy focus on social media to extend their reach. The Nerheims throw in a dose of radio advertising on four local stations and clinics for women customers to their marketing mix, while Rodrigo has newfound success with billboard advertising (with pricing on this medium coming down in major Mexican cities in his market).
At the end of the day, while many processes and strategies have changed as a means to safeguard one’s business during the pandemic, some things remain the same.
Rodrigo pointed to the passion he has for this industry and his unwavering commitment to his company’s success, which he said “becomes contagious with your people. One dream, one team with passion.” Rodrigo emphasized creating a solid plan, being organized, evaluating your strategies and setting a good example for your people.
Jerry expressed similar sentiments, noting that the Waukegan Tire team’s passion is to work side-by-side to serve customers better than anyone else. “When you truly love the business and enjoy what you’re doing, you care for your customers and treat them with the utmost respect, ensuring that the customers’ experience is ‘the best that it can be,’” added Steve.