Stop spinning your wheels and turn tires into a profit center.
Tires. They’re the foundation of almost every vehicle—including lift trucks. However, for some reason, they become an afterthought to many consumers. Uneducated end-users assume that “a tire is a tire.” However, that’s not always the case. Jeep owners know that off-road tires make it easier to play in the mud. Race car drivers don’t get their tires from Wal-Mart. It’s the same in material handling. Depending on what sort of application a customer has, the type of tire it requires changes.
It’s not just about performance either. It’s about safety. Chunked tires reduce truck stability and lead to a bumpier ride for the operator. This ergonomic nightmare can cause back pain and put valuable operators out of commission.
Tires can also be a phenomenal source of revenue for material handling salespeople. Oftentimes end-users opt for cheaper tires to cut costs when they’re purchasing a lift truck. Inevitably, the tires will shortly need to be replaced and low-cost, low-margin tires are once again the choice. This will obviously be frustrating for the customer who thinks that he or she should get premium performance for bargain-basement prices. However, as one MHEDA member learned, if you can properly demonstrate to the customer the truth about cheap tires and the benefits and significant ROI that can be obtained from switching to a higher-quality product, you can solidify a customer relationship and also make a few bucks.
When an Expensive Tire Is Cheaper
One of Wisconsin Lift Truck’s (Brookfield, WI) largest customers is a household goods manufacturer in Racine, Wisconsin. WLT has over 220 trucks in the customer’s facilities throughout the country under a full-service fleet program.
Since it was such an important account, Field Service Manager Pat Ryan kept a very close eye on the fleet. Each month he provided the customer with spreadsheets explaining every detail of the fleet’s performance. After a few months reviewing these reports, Ryan began to notice a trend. These trucks were being run about 500 hours a month and their tires were only lasting for about 1,500 hours. This meant that many of the trucks needed new tires every quarter.
This was an unacceptable situation for Ryan, and he set out to find a solution. His first call was to Brian Riggs, WLT’s tire specialist. He explained the situation and Riggs got down to business. To help find the perfect tire for the application, Riggs contacted Philip Lannon, NAFTA sales manager at Continental Tire. Both Lannon and Riggs studied the application, finally deciding on a Continental MH20 tire. They believed its solid shoulder and lack of tread pattern would be ideal for maximum stability with heavy loads. They were also designed to last much longer than the tires that the customer was currently using.
At first, the customer wasn’t receptive to the idea of new tires. He had requested the lower-quality tires because they were cheaper, and he was still hesitant to pay the premium for the MH20 tires. He even briefly considered opening up the bidding to other companies before Ryan talked him out of it. Ryan offered to give the customer a set of the Continental tires free-of-charge to see how they would perform. The customer agreed to try them out and ended up being thrilled with the tires.
Ryan then put together a presentation for the customer detailing how, over the course of a calendar year, the more expensive tires would actually be cheaper than what they were using. The MH20s were able to run 3,000 hours before needing replacement—double the previous tire’s capabilities. The customer recognized the value of the Continental tires and decided to purchase them for the entire fleet. “This sale was a big win for all three parties,” says Ryan. “The Continental tires enabled us to solve a very big problem and, more important, keep our customer extremely happy.”