Real-world experience – Tire-Rama implements business plan developed by three UM students

A year ago, when a University of Montana professor assigned his students to research a public company and develop a business strategy for it, little did he know they would have a hand in shaping the future of two Montana-owned and operated businesses.

By BETSY COHEN of the Missoulian

Although each student was free to choose any company for their semester-long project, three of Clyde Neu’s business students were looking for real-world experience with the potential for real-world impact.

Independently, students Jenny Mish, Jon Putnam and Chris Lende asked Neu to help them find a Montana business they could learn from and help grow.

Jenny Mish, one of three University of Montana business students who convinced Tire-Rama to expand its number of stores, says she was able to offer the store "a particularly useful viewpoint as a woman over 30 who had been less than thrilled with the tire shopping options."

Because the three shared the same mission and were matched in their enthusiasm, Neu decided to break from his tradition and have them work as a team.

Then he helped them find a company amenable to having three students poke around their budgets, pour over company expenses, interview their employees and study their competition for weeks on end.

Several companies considered the prospect, but in the end, it was Tire-Rama, a Billings-based tire chain, that took the offer.

"Our company is 25 years old, and we have a lot of people retiring and new people stepping into management positions," said David Wehr, Tire-Rama executive president. "The students’ offer to do a market study for us was good timing because we are in a stage where we are really looking hard at how to be a successful Montana-owned company for the next 25 years."

Admittedly, it was a little strange to share with the students the business’s closely held operating information, but Wehr said the experience was so enlightening and helpful, he’d do it again.

A year later, after the students immersed themselves in the tire business and created a new business plan for the company, Tire-Rama is putting the students’ advice into action.

At the students’ suggestion, Tire-Rama bought Bakke Tire Service Center, a Missoula-based tire chain, to build a stronger business presence in western Montana, where much of the state’s growth is occurring.

"The students’ work got us off dead center," Wehr said.

"Rarely do we come over to the western side of the state, and the west side of the business just sort of happened," Wehr said. "Because we didn’t get here a lot, we didn’t really understand the geography and what areas of Missoula are expanding and how communities in western Montana are growing."

"One of the key points of the students’ research showed us that today’s consumers are in a hurry and access is a key component of people’s purchases, and we needed more points of access," he said.

Now with the purchase of Bakke’s four stores – three in Missoula and one in Hamilton – Tire-Rama has a total of eight outlets in western Montana, employs more than 300 people and is confident it can capture more of the tire market.

"Something else we hadn’t really looked at was the fact that women are doing most of the purchasing, that the percentage of female to male customers is about 60/40, and for us, that was a huge eye-opener and has made us reconsider what we were doing on the sales floor."

One of the most interesting parts of the research, Mish said, was experiencing how Tire-Rama salespeople – and the chain’s competitors – dealt with customers when they didn’t know they were being studied.

On countless secret shopping expeditions, Mish said she uncovered some critical data.

"I think I was able to offer Tire-Rama a particularly useful viewpoint as a woman over 30 who had been less than thrilled with the tire shopping options I found when I moved to Missoula," Mish said.

"Research confirmed that my personal experience as a woman shopper in the baby boom generation is pretty typical for my demographic," she said. "As a shopper, I had wanted salespeople who would help me quickly understand the costs and benefits of various tire features."

Instead, she found most salesmen flopped between patronizing and condescending while working with female customers, and she also experienced some of those tendencies while querying Tire-Rama managers about their business strategy.

"I came away from some of our conversations feeling like we were speaking different languages, and they probably felt that way, too," Mish said. Although the communication challenges were oftentimes frustrating, the experience proved to be hugely rewarding.

"It was great for me to get to experiment with this kind of communication in a protected environment where my mistakes would be less costly to my career," Mish said. "I think my presence on this team helped Tire-Rama to appreciate the need for a diverse work force and the need for different sales approaches for different types of customers."

Wehr said he appreciated the students’ feedback, and is more than impressed by the work for his company.

"I never knew this kind of opportunity is available at the University of Montana," he said. "That taxpayers paying into the university system actually get something out of it.

"We also learned first-hand what a nice pool of people they are to associate with and look to for future good managers."

Professor Neu said he too is immensely pleased with the students, their project and their outcome.

"I think it is probably one of the best I have seen," Neu said. "It worked out well."

Of course, he said, they all earned an A.

Reporter Betsy Cohen can be reached at 523-5253 or at [email protected]

http://missoulian.com/articles/2003/11/11/news/local/news02.txt