Tire market – is there a chance for small businesses?


Tire market – is there a chance for small businesses?

Every entrepreneur who opens his own small business must assess the possible risks and determine the feasibility of investing. It is essential to do this in cases where the new company’s purpose is to sell, service or recycle tires. To carry out such work, it is necessary to study the situation in the tire market, consider the most promising ideas and become familiar with possible problems. This approach will make it possible to understand how promising a small business can become and what chances it will have for success.

The situation in the modern tire market

The tire market is changing at a rapid pace. In this regard, what brought good profits just a few years ago is irrelevant and leads to severe financial losses. Such changes are due to several factors. Firstly, companies with serious ambitions appear in the global tire market yearly. They invest heavily in advertising campaigns and try to attract the attention of customers who have not yet chosen their favorite. This circumstance gives minimal chances to small businesses whose owners do not have the opportunity to invest vast amounts of money in their projects.

The second significant trend observed in the tire market these days is the growing influence of online stores. According to statistics, owners of new vehicles and models purchased at auto auctions in Arizona and other US states are increasingly buying tires online every year. Moreover, the growth in sales volumes of online stores is growing at a breakneck pace. Today, online stores account for 10%-15% of the total number of tires sold in different countries, but next year, figures of up to 20% are expected. All this puts small businesses in a difficult position and does not give them much chance of survival.

Ideas for organizing a small business

Tire sales

The most affordable option is to sell tires. It can become a profitable business, but you must properly organize the entire process, carry out preliminary preparations and have good start-up capital. First, finding enough money to open a small business selling tires is essential. The exact quantity is calculated depending on the store’s size, the assortment’s width and the expected sales volumes. Next, you need to determine the needs of the target audience. Such preparation includes studying the opinions of owners of various vehicles and a large amount of statistical data. Having done this work correctly, you can obtain information about the most popular types of tires, the preferred price of products and other essential points.

To avoid going bankrupt a month after opening a small business, you need to attract attention to the store. This is as difficult as possible in conditions of fierce competition, but there is a chance of success even in such cases. However, if you can find regular customers, the likelihood of a positive outcome will be higher. In addition, it is essential to sell only high-quality goods and not try to avoid paying all applicable taxes.

Opening of a tire workshop

Providing various services to help keep your tires in tip-top condition looks promising. If you implement all your ideas, the tire workshop can generate a consistently high income. Before opening a small business in this area, you need to select a team of specialists who can perform high-quality work on inflating tires, repairing punctures, checking the condition of car wheels, etc. Next, you should conduct several preparatory actions, including studying the tire market, determining the needs of drivers, and completing the necessary documentation.

To open a tire workshop, you will also need start-up capital. Most of the invested funds will be used to purchase the necessary equipment and rent suitable premises. You should also provide for unforeseen costs and financial losses associated with purchasing consumables. Advertising the workshop is an equally important stage in developing a small business. Although it will increase costs, it will provide an opportunity to attract the attention of owners of various vehicles.

Recycling used tires

Due to the constant increase in the number of cars on the roads, the need for enterprises that recycle and dispose of used tires is growing. This small business option is up and coming and will become even more popular. At the same time, entrepreneurs do not have to create a giant factory with many employees. It is enough to open a small enterprise constantly loaded with work. If successful, expanding the business and opening new mini-factories in other cities, regions, and countries will always be possible.

You will need considerable investment to organize a business to process and recycle used tires. They will be used to prepare documentation for the enterprise, purchase special equipment, search for qualified employees, rent suitable premises, etc. If you set your priorities correctly, you can minimize costs and achieve your goal. It is also important to remember that today, in most countries, there are not many tire processing and recycling plants. Hence, the likelihood of rapid business development is higher than when trading tires or providing tire workshop services.

Key issues

Selling tires is a profitable business. That is why many people strive to open their small businesses and get a good share of the profits. However, today, in most cases, attempts end in failure and severe financial losses. This is due to small business owners’ considerable number of problems. The main one is the lack of interest of buyers in start-up entrepreneurs. According to statistics, most car owners purchase tires from time-tested sellers and ignore their competitors. This puts small businesses in a strict framework where they have to fight for every customer. It is almost impossible to improve the situation since few people will change their preferences and consider alternative options.

The next problem is related to the cost of production. Due to high competition, it has already been reduced to a minimum, so small business owners will not be able to attract the attention of buyers by providing financially profitable offers. It should also be noted that large stores and companies have more opportunities to organize a variety of promotions that allow customers to get tires at a reduced cost. An equally serious problem that small business owners often face is the lack of significant start-up capital. Because of this, it is impossible to impose competition on market leaders regarding the width of the assortment, the scale of advertising campaigns, and the volume of daily turnover. Anything overpowered minimizes the chances of a small business and prevents it from expanding its customer base.

The modern tire market is very different from what it used to be. Constantly increasing competition, increasing online sales volumes, and the target audience’s interest in the products of top brands have led to the fact that small businesses today have virtually no chance of success. The situation will become even more depressing in the future, so most beginning entrepreneurs should now look for other niches where the likelihood of organizing a profitable business will be much higher.

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