Eliminating the element of surprise
An independent, privately owned company, Tyres 2000 has nevertheless made its mark on the local commercial transport industry. How? It has achieved the almost-impossible: fixed tyre costs for operators and fleets of all shapes and sizes, no matter the operation.
“The hugely varying costs associated with tyre maintenance and tyre replacements, and the added costs associated with poor tyre maintenance, such as high fuel consumption, are a significant expense to operators,” explains Chris Hurly, a director of Tyres 2000.
“Add to this the expenses associated with tyre-related breakdowns, and it’s clear that tyres have long been a major frustration to transport operators.
“One of the biggest challenges, however, has traditionally been the fact that tyre costs tend to be a variable, rather than fixed cost,” he continues. “This makes it difficult to always budget around tyres, and operators can often suddenly incur large tyre-related expenses – particularly if a breakdown has occurred.”
Tyres 2000 has devised a unique solution to address these difficulties in the form of CPK (or cost per kilometre) and maintenance contracts.
“CPK contracts have a chequered past,” reveals Hurly. “When they were first introduced to the South African market, the idea was for operators to be charged a fixed amount in return for a full, outsourced tyre maintenance service. The idea was sound, but unfortunately in practice operators tended to still have hidden costs, and while the idea was popular, the reality was not.
“When we started Tyres 2000 almost a 15 years ago, we wanted to address this situation. We formed our company as an independent business designed to offer operators a full tyre solution. Gradually, both maintenance and CPK contracts evolved again, and in the past three years this has been the biggest area of growth for us. Operators want to be able to have tyres on their books as a fixed cost, with the added benefit of professionals addressing their tyre maintenance and breakdown needs.
“We have developed a proactive solution to the problems previously experienced with such contracts and the result has been industry acclaim. Our solution works.”
The reasons behind Tyre 2000’s success are simple. First, Hurly insists that Tyres 2000 is unique in that it is prepared to undertake fixed quoting and turn this quote into a fixed cost. “Obviously we need to be reasonable,” he says. “We are not trying to be the cheapest. We aim to be the best. Our promise is that for a reasonable, fixed budget, we take complete ownership of a fleet’s tyres, from choosing, buying and fitting the correct tyres, to maintaining, retreading, ensuring correct balancing and wheel alignment – basically, complete tyre maintenance. An operator who signs a CPK or maintenance contract with us need never even think about his tyres again.”
This includes a full breakdown service, complete with a call centre staffed by tyre-literate, lateral thinkers who are dedicated to quickly and safely returning the vehicle to service.
“We manage over 1 000 tyre-related breakdowns per month,” reveals Hurly, “mostly at our own expense based on our fixed-cost contracts.”
But it is not only the costs of buying, maintaining and replacing tyres that our contracts cover.
“While operators are aware of how important and costly tyre maintenance is, they do not always have the expertise to run the most efficient programmes, which is why outsourcing this function is so important,” explains Hurly. “Fuel consumption, driver fatigue and overall safety are all directly linked to tyre maintenance, but it’s an area that requires a level of skill to really perfect and get the most out of. Through outsourcing tyre maintenance, an operator can get the most from his tyres without needing to train or manage his own staff to perform this duty.”
Tyres 2000 offers both on-site solutions and a nationwide network of branches. “If the client is big enough, we are able to place staff on their premises,” explains Hurly. “The tyre maintenance division is then employed by us, but on site to ensure adequate service.
“For smaller operators, we have 26 branches across the country and are on route to 42 facilities countrywide, which means we are able to maintain our contracts or address a breakdown wherever a truck may be.”
In fact, Tyres 2000’s phenomenal growth over the past decade is based on its ability to adapt to the market and what its clients need, whether they own fleets of 300 vehicles or fewer than 10. The company currently services over 100 fleets in a variety of applications.
“We have specifically targeted local blue-chip and owner-driven enterprises,” explains Hurly. “Our unique package solutions, personal service and attention to detail have stood us well, but we believe the secret to our success is that we target a specific niche market of companies whose business practices match our own.
“We are a hands-on company, with management and directors actively involved in all aspects of our business. When we approach a potential client, or if a problem arises with a present client that urgently requires a solution, we want to be able to sit with the owner of the transport company and devise a pragmatic solution together.
“A flat management structure means a rapid response to challenges and decisions, which is how we prefer to operate, and is one of the reasons why our solutions work. We have access to the owner and upper-management of each of our clients, and we are able to therefore devise a unique and precise solution for their operation, quickly and effectively.
“Each client receives a customised service level agreement with pre-determined and agreed-upon goals, audited by computer-generated reports, and all without exceeding a reasonable budget. We eliminate cost spikes while still addressing all the tyre requirements an operator might have.”
Another secret to Tyres 2000’s success is its independence. “We are not owned or affiliated to any one tyre manufacturer, or the stock exchange,” continues Hurly. “Because of this, we can offer arguably the most comprehensive range of products, including new tyres and retreads, both imported and locally produced.
“In order to provide the best possible service, we prefer to associate ourselves with premium products, and we have our own retreading facilities at which we are able to offer various retreading options based on the specific applications of the retreads.”
Tyres 2000 was even awarded the Michelin International Accreditation at all its truck tyre retreading facilities, a stringent and prestigious confirmation of the company’s exacting standards. The accreditation has also allowed Tyres 2000 to become Africa’s largest supplier of Michelin’s retread rubber, known as Recamic.
“We believe success lies in balancing good products with service, as well as fostering strong client satisfaction with both,” Hurly explains. “We strongly believe that our clients must have complete confidence in us. Trust can only be earned if we are proving ourselves month after month, however, which means we need to understand more than simply the needs and goals of our clients, we need to understand their vision and company culture.”
As a result, Hurly believes that customer satisfaction actually hinges on Tyres 2000 proving itself, not only to the owner or MD of a company, but the whole team of each department it works with.
It is this attitude that has secured Tyres 2000 a FOCUS on Excellence nomination for Best Tyres Services. “We have always paid a great deal of attention to customer satisfaction,” concludes Hurly. “We are in the business of providing a service, and part of that service is our customers being satisfied with the delivery of our promises.”