Do you want to start a tire shop business? Read this article to know more about starting and running a profitable tire store covering essential information regarding like legal considerations, equipment, advertising ways, etc.
The global tire market is broadly classified into six categories based on the types of vehicles. They are passenger car tire, light commercial vehicle tire, medium and heavy commercial vehicle tire, two-wheeler tire, three-wheeler tire, and the Off the Road tire. The global tire market as per automobile experts is forecasting growth at a CAGR of 8.4% in value terms during 2016-2021. This statistics amply amplifies that the demand for tires to grow in the coming days. Hence, if you are looking to start a retail-based business in the automobile industry, starting a tire shop is a profitable proposition.
Here is 10 Step Tire Shop Business Plan Guide
1. Do Market Research
The first thing before starting a tire shop is to understand the demand for the local market. Essentially, tire stores are seen doing good business in cities and small towns. Also, strategically located spaces beside highways also are much-sought-after locations for tire stores. It is highly recommended to conduct market research locally and gather information as much as possible.
2. Choose the Products
The inventory to be kept in your shop largely depends on the type of vehicles on the run in your vicinity. You can sell a wide array of types of tires for heavy-duty vehicles, light passenger vehicles, two-wheeler tire, four-wheeler tire, etc. The ratio of inventory will depend on the quality of vehicles on the road in the nearby locality. You can also sell rims, tubes in addition to tires in your tire store.
3. Business Plan
On the information received on researching the market, it is extremely important to craft a business plan for your tire shop. Take some time off and write your own business plan. You can also take help of business plan tools to write the business plan.
4. Selecting the Type of Tire Shop
There are many ways of starting a tire shop. You can take an authorized dealership of a reputed tire brand and start as an exclusive outlet. Many tire shop owners prefer selling tire of different brands and create a multi-brand store. You can also go for buying a franchise of a reputed multi-brand tire selling company.
5. Make the Tire Store Legally Compliant
Talk to the local appropriate authority and get the required licenses and permits to start and run a tire shop. In addition, form a company with the most suited business structure available in the state or the country. For example, if you are from the United States, forming an LLC will provide you with extra benefits.
6. Choose a Retail Space
Selecting the proper location for your tire shop is perhaps the single most critical decision to be taken while running a profitable tire shop. The location must have a good local market for tires. You also need to ensure some extra space for parking of vehicles arriving at your shop.
7. Hiring Manpower
While running a tire shop, you will need good efficient manpower both for administrative and technical purpose. Evaluate the number of personnel you need and create a job profile for each requirement. You can hire a recruitment agency or advertise your vacancies in local newspapers.
8. Procuring Inventory
If you have planned to sell tires or a single brand or buying a franchise, selecting and procuring inventory will be much easier. However, if you are into starting a tire shop of your own from scratch, you must devote much time to develop a network of tire suppliers. You have to contact the manufacturer and supplier of various brands and set up a standing order procedure for buying tire inventories.
Tire changing and installation equipment are must-haves while starting a tire store.
9. Selecting Business Software for a Tire Shop
If you want to run your business professionally, you must equip your tire store with relevant software. Tools like customer relationship software (CRM), the point of sale software (POS), and proper accounting software is a must.
10. Advertising a Tire Shop
As with any other retail business, it is all about traffic to make a tire shop profitable. The more the traffic, the chance of more sales. One of the most popular ways of attracting customers at your tire shop is to offer a free service. For example, it can be a simple pressure checking, safety inspection, or any other service you think will benefit customers. Train your sales personnel on how to convert them into buying something.
There are plenty of low-cost ways of promoting your tire shop. Create brochures, pamphlets and distribute them to prospective customers. Nowadays, going online is a must. Create a website and promote it so that the customers can reach you online. Social media is another platform where you can advertise your services to customers at their doorstep.