System and Method for Identifying Retail Tire Sales

Abstract

The present invention describes a system and method for evaluating an automotive service center's opportunities for retail tire sales and service, including projecting potential sales and generating other business information for creating a tire service center at an existing repair service center. The present invention may be utilized for service centers which are independent or part of a dealership. The dealership may include both new car sales, used car sales, and a service center.

It is claimed: 
     
         1 . A method of calculating the return on investment associated with establishing a retail tire sales business, wherein the business sells tires to one or more carlines, comprising:
 determining a sales goal measured in number of tires to be sold for a period of time;   calculating a tire sales figure for a time period by adding an average retail tire price and a charge for services involved in mounting and balancing a tire to generate a sum, and multiplying the sum by the sales goal;   calculating a service lane tire profit by adding together a total tire gross profit based on the sales goal and the average retail tire price and a cost associated with supplying labor at the tire service center;   calculating the total net profit by adding additional savings and subtracting additional expenses;   calculating the capital investment by adding together cost of purchasing tire installation equipment and inventory investment costs; and   calculating the return of investment by dividing the total net profit and expense savings by the capital investment.   
     
     
         2 . The method of  claim 1 , further including calculating a monthly payback by dividing the return of investment by twelve (12). 
     
     
         3 . The method of  claim 1 , further including calculating a reduction in number of visits to competitors by dividing the number of tires sold by a loyalty factor. 
     
     
         4 . The method of  claim 1 , further including the calculation of inventory space requirements. 
     
     
         5 . The method of  claim 1 , wherein an additional expense is a cost of satisfying warranty claims, wherein the cost is determined by multiplying a number of new annual car sales for the dealership by a warranty factor. 
     
     
         6 . The method of  claim 1 , wherein an additional savings is a certified pre-owned savings, wherein savings are generated by comparing a cost associated with outsourcing tire replacement for a certified pre-owned car program with a cost associated with internally supplying new tires to certified pre-owned cars. 
     
     
         7 . The method of  claim 1 , wherein the tire business is established at a car dealership that sells new, used, and certified pre-owned cars. 
     
     
         8 . The method of  claim 1 , wherein the tire business is established at an automotive service center. 
     
     
         9 . A system of calculating the return on investment associated with establishing a retail tire sales business, wherein the business sells tires to one or more carlines, the system comprising:
 one or more data processors;   one or more computer-readable mediums encoded with instructions for commanding the one or more data processors to execute steps that include:
 determining a sales goal measured in number of tires to be sold for a period of time; 
 calculating a tire sales figure for a time period by adding an average retail tire price and a charge for services involved in mounting and balancing a tire to generate a sum, and multiplying the sum by the sales goal; 
 calculating a service lane tire profit by adding together a total tire gross profit based on the sales goal and the average retail tire price and a cost associated with supplying labor at the tire service center; 
 calculating the total net profit by adding additional savings and subtracting additional expenses; 
 calculating the capital investment by adding together cost of purchasing tire installation equipment and inventory investment costs; and 
 calculating the return of investment by dividing the total net profit and expense savings by the capital investment. 
   
     
     
         10 . The system of  claim 9 , wherein the steps further include calculating a monthly payback by dividing the return of investment by twelve (12). 
     
     
         11 . The system of  claim 9 , wherein the steps further include calculating a reduction in number of visits to competitors by dividing the number of tires sold by a loyalty factor. 
     
     
         12 . The system of  claim 9 , wherein the steps further include the calculation of inventory space requirements. 
     
     
         13 . The system of  claim 9 , wherein an additional expense is a cost of satisfying warranty claims, wherein the cost is determined by multiplying a number of new annual car sales for the dealership by a warranty factor. 
     
     
         14 . The system of  claim 9 , wherein an additional savings is a certified pre-owned savings, wherein savings are generated by comparing a cost associated with outsourcing tire replacement for a certified pre-owned car program with a cost associated with internally supplying new tires to certified pre-owned cars. 
     
     
         15 . The system of  claim 9 , wherein the tire business is established at a car dealership that sells new, used, and certified pre-owned cars. 
     
     
         16 . The system of  claim 9 , wherein the tire business is established at an automotive service center. 
     
     
         17 . A computer-readable medium encoded with instructions for commanding the one or more data processors to execute steps that include:
 determining a sales goal measured in number of tires to be sold for a period of time;   calculating a tire sales figure for a time period by adding an average retail tire price and a charge for services involved in mounting and balancing a tire to generate a sum, and multiplying the sum by the sales goal;   calculating a service lane tire profit by adding together a total tire gross profit based on the sales goal and the average retail tire price and a cost associated with supplying labor at the tire service center;   calculating the total net profit by adding additional savings and subtracting additional expenses;   calculating the capital investment by adding together cost of purchasing tire installation equipment and inventory investment costs; and   calculating the return of investment by dividing the total net profit and expense savings by the capital investment.