STRONGER THAN THE CRISIS
About two years ago, the Michelin group’s franchising chain arrived in Italy and it aims to double its 100 affiliates within 2012: new MD Martial Lafont sums up the past season and unveils to Pneurama his plans, initiatives and expectations for the future
Mino De Rigo
TWO YEARS of preparatory work before the official start up in April 2010; the recruitment of the first 17 Euromaster Italia centres, which had grown to 67 by the end of last year; a change in top management in January, when Thierry Vanengelandt handed over the reins to the new MD Martial Lafont. Now the time is right for the first balance sheet of the Michelin franchising network and an outline of current developments, the new product-service mix and prospects at the start of a season that is again threatening to be difficult for the entire market.
What were the closing figures for 2011-2012, Dr. Lafont?
The financial statement is more than satisfactory considering the ambitious objectives we began with. The number of affiliates is growing fast and in the first two months of 2012 we already had another 8 centres which brought the total to 75. At the end of the year we should have a 100 and aim to double this figure by 2015. It is a long road and we continue to work with enthusiasm and have had favourable feedback from the professionals in the tyre world who are obviously our target.
What has emerged from the financial report?
As only 9 centres have been operating with us throughout 2011, business volumes do not seem to be very significant, but the results in revenues are really encouraging. Specifically, the other services offered by the two centres that totally adopted our work methods have abundantly compensated for the falloff in income linked to problems in the tyre market.
Does that mean that not all of them will are able to do it?
The tyre repair trade is not new and our affiliates are certainly not novices, but over its 20 years of experience the Euromaster chain has developed work methods that appear to be very simple when looked at individually, but as a whole they give excellent results when they are applied every day. Of course, it is an important change that does not happen overnight. Our daily commitment is to give affiliated entrepreneurs support for deciding priorities and maintaining them.
Will the change of reins at Euromaster Italia also bring about changes in strategy and the approach to the market?
There will be total continuity in line with the strategic action that was started by my predecessor in previous years. The handover period was over several months, which allowed me to fully understand the logic of the Italian market at the head of a highly professional and increasingly competent team.
So the aims are still the same?
We want to cover the whole country in the shortest time possible. All that we are lacking today is time because we are growing at an amazing rate. But we must be certain about our affiliates’ level of organizational and technical integration.
There are other networks that also offer their members multi-brands and light mechanical services: in what way are you different?
Primarily it is our approach that is different, the know-how of a leading chain in Europe with over 2000 servicing centres, which translates into technical and commercial methods of proven efficiency. We also believe that the support of our consultants is a fundamental point of differentiation. Then there is our long-term relationship with supplier partners.
At a critical time in the economy, with a falloff in consumption, the sale of fuel and travel, which all lengthen the intervals between tyre replacements, how is it possible to prosper? Is repositioning the answer?
Our positioning in Italy and the rest of Europe is based on the high quality of our products and services: because we are tyre specialists, first we must be certain that all the activities that revolve around tyres have been carried out correctly; then comes light mechanics and the other services. We want to reconfirm our positioning, which is increasingly valid today: to be the experts for your tyres. But we must consolidate the enormous amount of work that has been done in the past to convince tyre repairers about the reasons for joining Euromaster and changing their approach. We work with professionals who have a future among the successful, not to keep alive those whose fate is sealed. The more expert and professional share a goal that is not about selling more tyres but about replacing them only when it is necessary, so they keep their customers longer.
Does this also apply in the current difficult times?
Through their services Euromaster centres ensure customers that they will make use of every millimetre of rubber: it’s not about giving anything away, but doing a good job so that everyone gains. This still applies today, because every euro invested has a precise return, and establishing a relationship of trust with tyre repairers means safety. For the family, the purchase of a set of tyres is the second biggest expense after holidays: when we tell them that the tyres must be changed, it must be true and our job is to demonstrate it. Those who over charge know they will never see the customer again; but our work is long-term with complete transparency and trust. Before each job the Euromaster centre itemizes the costs and explains them clearly. And then there is a service that ranges from a three-year warranty for tyres to storing tyres for summer-winter changeovers.
We haven’t heard anything about the fleet segment...
In Italy we are in the fleet segment with Michelin. As so the specific Euromaster offer, we don’t intend to give up this market but want to enter it with an offer that has weight and as a leader, like we are in France and Spain. As soon as we have covered Italy and all the centres have metabolized the Euromaster method, we will introduce ourselves to the big leasing companies.
Your plans for initiatives and partnerships?
We already have numerous activities on track, which we must now follow up and consolidate as requested by the affiliates to help them get organized for taking advantage of every opportunity. As to collaborations, this year’s developments concern the possible exclusive marketing of the Tigar brand, Goodyear Dunlop car tyres, Continental car tyres and Uniroyal truck tyres, and even Alcar and Oz Racing wheels; in addition to partnerships with Bosch and Shell, we have reached an agreement with Beta for machine tools, with Gartec for equipment and lubricants, Secur Pneus for nitrogen, Ald for courtesy cars and with Cartasì for banking products.
What do expect for the future?
Primarily, we are hoping that there will be no delays for the authorizations required for adding to the network. But an element that is certain and which could change segment dynamics is, without doubt, the European label: a possible revolution in tyre assessment by consumers. It is difficult to say where the market will go, but for us this represents a huge opportunity, a change that will be an advantage for the more professional tyre repairers.
• The tyre professionals
Although they have all been recruited by the Mastro Michelin centres, Euromaster Italia is also open to other candidates. The company’s new MD Martial Lafont said: “We want the best and give priority to Michelin partners but without excluding any other candidates. Retailers deciding to join our network will in any case find themselves at a crossroads, so it is a decision that must be pondered carefully. We are looking for long-term affiliates and anyone who signs up for five years must be aware of this”. At the beginning, it is a jump in the dark, almost an act of faith, for the tyre repairer, but once the decision has been made “we systematically apply management and operation measurement tools to demonstrate how good our methods are; and then there is the key role played by the consultants”. It takes at least two months to prepare a potential Euromaster centre: “It is essential” – Lafont emphasized – “to have motivated people who can handle changes in the market and the strong commitment our system demands”. And also a change in work methods: “In general we meet with considerable scepticism, but feedback comes soon thanks also to the experts at our head office who provide systematic consultancy from purchasing to marketing. And feedback from the affiliates is always gratifying. Particular thanks came from the professionals who applied our methods during the winter peak and were able to considerably improve work management”.