Taking the Plunge: The Good Tyre Guide and bridging the online retail/wholesale gap

The launch of Grouptyre’s goodtyreguide.com proves that the era of apps, widgets and plugins is upon us (see October’s magazine for more on this). And while this column doesn’t normally single out individual companies for attention, the fact that we are running both e-Commerce and Wholesale features this month makes this story too apt to miss.

When Grouptyre announced it was seeking to bridge the wholesale/retail divide with a solution that not only ensures it has an online footprint, but also seeks to make the enterprise profitable for everyone involved, it certainly caught the market’s attention (see September’s magazine for details of the launch). That’s not to say that Grouptyre is unique amongst wholesalers in considering an online channel/B2B plugin approach. Far from it. Tyres & Accessories has it on good authority that all of the top three have looked into operating comparable systems. The difference is that Grouptyre is the first one to seize the initiative and take the plunge.

Representatives of the other market leaders told T&A they are happy to stand by and “watch what happens”, with a view to learning from the mistakes of those that go before them. However, as any management guru will tell you, there is a kind of law of diminishing returns when it comes to initiative. Anyone who dreams up and initiates an idea gets the most credit. The second off the blocks gets some credit, but significantly less than the first. Those that follow this first follower get little or no credit. There are risks to going first, but there are disadvantages to being a follower too.

One reason why Grouptyre is currently standing alone in this respect is because the other wholesalers are concerned that prices will be pushed down. However, Grouptyre managing direct Karl Naylor told T&A that Good Tyre Guide’s price positioning may be higher than purchasing tyres directly from an independent dealer in a deliberate move aimed at keeping standards high and distancing the company from the commoditisation of tyres that can happen on the internet. Instead, there is a real emphasis on selling by brand rather than price.

However, the importance of being first is not lost on Naylor, when T&A met up with him recently. For him, a key part of the motivation behind the move was to make a sort of pre-emptive strike. In his words “Grouptyre didn’t want to be simply reacting to someone else’s move” – understandable when you consider that the system has been near readiness for almost two years.

So why the delay? Getting the stock systems of 13 independent wholesalers, with 35 warehouses and 100 retail stores to talk to each other is no simple task. But now that the system is live, the beauty of it is that it brings the Grouptyre member companies (and their future and existing customers) together, offering everyone involved a profit-making opportunity – something that existing e-tail operations have been unable to do. Where they offered a fitting fee, Grouptyre’s system offers dealer partners a revenue-making opportunity – all on a price range paired with Grouptyre’s national price list

Basically, Grouptyre’s system makes the whole process one step shorter than “pure” e-tailers, while offering considerably better stockholding at the same time. While some e-tailers leave delivery times open up to a couple of weeks, Grouptyre can do the same in 48 hours. “We want to give consumers the choice,” Naylor commented. Furthering this sentiment, an Ebay-style branch rating service will give consumers the opportunity to rate branches and thus give retail partners the necessary impetus to keep their eyes on quality.

But it doesn’t end there. As part of a later stage of development, Grouptyre has revealed plans to integrate a filtered version of its new system with vehicle main dealer websites, a number of which the company have already approached. Their sites will then have Good Tyre Guide’s tyre selection engine as a plug-in bolted onto their site. In return, these branches will also be listed on the Good Tyre Guide proper. This kind of approach also lends a helping hand to small and medium size chains that don’t have budget available for expensive e-commerce system development.

The launch that took place last month was described as phase one in the site’s development. But moving forward there are initial plans for another three phases, including the proposed implementation of some really quite innovative ideas. However, these are still in the early stages, leaving us all to ask who else will have taken the plunge by then?