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Larry Sutton is the Founder and President of RNR Tire Express, a national tire shop franchise with 155 locations across 26 states. RNR Tire Express was initially founded as Rent-n-Roll, in 2000. Larry attributes the success of RNR Tire Express to focusing on what your shop does well and serving customers — not just providing service.
In this episode…
As the owner or manager of a tire and auto repair shop, does your store try to be all things to all people? Or does it stick to what it does well? According to Larry Sutton, the President and Founder of RNR Tire Express, a key to his shop’s success and longevity is to keep it “as simple as possible and stay focused on what you do well.” Larry has discovered that messing around in different areas can take your focus off the main business, and as a result, you won’t be as good at your primary business as you want.
In this episode of Gain Traction, Mike Edge discusses the true meaning of customer service with Larry, who says, “we’re a real proponent of what we call serving our customers, as opposed to just providing service.” Larry says straying from what your shop does well causes your level of customer service to drop from what it could be. Larry and Mike also talk about franchising in the tire industry, generating repeat business, and the best movie of all time. Don’t miss it!
Here’s a glimpse of what you’ll learn:
- Larry Sutton explains why he brought the rent-to-own concept to the tire industry
- How Larry got into the tire business
- What it was like to open the first store
- Larry’s philosophy for achieving business success
- The rate of return customers for RNR franchisees
- Why Top Gun: Maverick is Larry’s favorite movie of all time
Resources mentioned in this episode:
- Larry Sutton on LinkedIn
- RNR Tire Express
- Dick Erickson
- Sun Tire
- Mike Edge on LinkedIn
- Tread Partners
Transcript
Announcer:
Welcome to the Gain Traction podcast, where we feature top automotive entrepreneurs and experts and share their inspiring stories. Now let’s get started with the show.
Mike Edge:
Welcome to the Gain Traction podcast. Mike Edge here. I’m one of the hosts of Gain Traction, where I talk with top automotive business leaders about their personal experiences in the tire and auto repair industry, as well as extract some words of wisdom. Today I’d like to give a shout-out before we get started to Dick Erickson, former owner of Sun Tire in Jacksonville, Florida. He was my guest recently here on Gain Traction. He’s the author of a great book called How the Rubber Meets the Road. It’s a story about what he learned in the tire business and how he sold his business. I think you can get it on Amazon.
Today, this episode is brought to you by Tread Partners and the ReTread program. Tread Partners has a theory that your best audience to sell to today are your best lost customers. Tread Partners has designed a product called ReTread that is a full-scale customer re-engagement program to win back a shop’s best lost customers. It is a one-time 90-day program that generates a guaranteed … that’s correct … a guaranteed return on investment. The ROI’s ten to one, no tricks or gimmicks. These are customers that are in your POS system right now. What we’re saying is if you invest $10,000 today, we’re saying in 120 days you’ll get a return of $100,000. We’ve removed the risk, so what are you waiting for? Email us at [email protected], or to learn more, visit treadpartners.com.
My guest today is Larry Sutton, president and founder of the RNR Tire Express franchise. After selling his first company, Champion Rent to Own, in 1997, and a brief retirement, Larry opened his first RNR tire store in an old gas station in October of 2000. Business was brisk, and soon after, he opened a second store in St. Petersburg, Florida. Larry franchised the concept in 2003 and began opening up RNRs with franchise partners across the US.
22 years later, there are 24 corporate stores, 151 franchise locations in 28 states, with another 150 locations planned over the next five years. In 2021, RNR Tire Express was the 14th largest tire dealer in the US. RNR’s total revenue for ’22 is expected to be $280 million. RNR specializes in payments to fit any budget with no credit needed. Retail sales represent about 20% of total revenue. Larry, welcome to the Gain Traction podcast.
Larry Sutton:
Thank you very much. I’m happy to be here today.
Mike:
Glad to have you. Obviously you know about rent-to-own. I mean, you had Champion for 24 years, I think we mentioned before the program started, and then you sat out for a little bit, had a little brief retirement. What made you say, “Hey, man, I’m going to take this concept I learned a lot about and apply it to tires”?
Larry:
Well, that’s a great question. Part of it was I’d tried some other things. I had a gap there for about three years, and retirement lasted for about six months. I was playing golf every day. I was living at a country club, and every morning I’d get up and get in my golf cart, go to the golf course and play golf. Then after I played golf, I’d go in and have lunch, and then the guys that were still working were coming in at about four o’clock in the afternoon and we’d play golf again. After about six months …
Mike:
You couldn’t take any more of that, huh?
Larry:
No, I couldn’t do it. I couldn’t do it. First of all, my handicap started off at 15. Six months later it was 21. I was just missing the interaction. I just wasn’t having fun. It was just something to do, take up space, so I got bored very quickly. I’ve tried a few other things. I bought some smoothie franchises from a company called Tropical Smoothie. I think today they’re called Tropical Cafe. I bought some of those in Jacksonville and tried that for a few months, just didn’t fit at all.
Then I had a no-compete, obviously, with the folks that I sold my company to, and so I had a five-year no-compete where I couldn’t go back into that same business. I was just really looking for what could I do, and I opened some check-cashing stores. I got three or four of those up and running and they were doing fine, but it still just didn’t fit. It just didn’t have that same feeling. In that business, there was no transition. There wasn’t a handoff of value of a product or anything. I just didn’t feel the same way about it.
I started just looking at different businesses, and I was up in Atlanta seeing a buddy of mine, and he actually said to me, he said, “Have you seen what these guys out in Texas are doing?” I said, “What are they doing?” He said, “Well, they’re renting to own tires.” I said, “Really?” I said, “Well, let me go look at that, because that sounds interesting.” I got on an airplane and flew out to Texas and visited a few stores, and when I got there, I realized that really it wasn’t about the tires so much as it was about wheels. What they were really doing was renting custom wheels, and the only tires involved were because, as you know, anybody that upsizes has got to have new tires. I looked at that, and I got intrigued by that.
I came back to Tampa. I started looking at the custom wheel industry, looking at a little history and the growth of it and tried to do a little research, and it really looked like it was getting just ready to blow up. I mean, it had just kept going up so fast, and I thought this might be a really good time to get in that business. I did a little research about suppliers and vendors and different things like that, and I said, “Well, we’ve got to do something, let’s give it a go.” I actually found a gas station not far from my home office, and rebuilt it and brought in all these different looks and different things and got a lot of different designs. When we originally opened, the name of our company was called Rent and Roll. It wasn’t RNR Tire Express. That was much later.
Mike:
I gotcha.
Larry:
The original name was Rent and Roll, and I thought that was pretty cool. I always wanted to be a rock and roll star, so Rent and Roll was kind of like [inaudible 00:07:05].
Mike:
Part of your dream coming true, right?
Larry:
Oh, yeah. Exactly, yeah. Our little jingle was, “Where you gonna go.”
Mike:
On the first store, did you go out and try to find some tire manager experience or anything?
Larry:
I actually called my nephew, who had worked with me in my other business, and I said, “What are you doing?” He said blah-blah. I said, “You’re coming back home. We’ve got a new adventure we’re going to take.” I sent him out to Texas to a buddy of mine’s store, to learn about wheels and tires. He went out there and learned how to install them and do different things and then came back, and by that time we were about ready to go. Basically, I hired a few folks from the old company to come in, and then of course some techs. We’ve got to have somebody to put this stuff on, right?
I’m telling you, we just didn’t know much, man. Our first store, when a customer would walk in the door, we would literally call our vendor, which was ATD. Before they were ATD it was Ifco Tires and Wheels, and the guy’s name over there was Eades, and he knew more about wheels than anybody I’d ever met. We literally would call him when the car drove in the parking lot and say, “What do you got that’ll fit this?”
It was so funny, because by the time we started getting closer to opening, we’d have people coming by every day knocking on the door, “You open yet? You open yet? You open yet?” The day we opened, literally we had people standing in line to come in. It was just like, “I can get wheels on payments? Are you kidding me? Boom, boom, boom, boom, boom.” It took off. I mean, it really took off, and we didn’t have a clue what we were doing. I mean, the first set of wheels I ever ordered, I ordered the wrong offset. When they got put on the car, the car wouldn’t go anywhere.
Mike:
Oh, my God.
Larry:
It was a real learning experience. I would generally spend my day at the store, and then after the store closed, I would go to my office and create new forms and new stuff like that every day, and say, “Well, we need this, we need that.” It was funny. I mean, it was really funny, but literally, we had a good time. We learned to do business, and before you know it, I mean, we had online everything. We could go right there. It took a while, but it was a fun learning experience. By the time we opened number two, we actually had kiosks in the store where people could actually look at their car with different sets of wheels. That turned out to be a marketing error but it was cool, because once they started doing it, you could never get them to stop.
Mike:
“No, let me try this one.”
Larry:
Waiting for their turn. Yeah, “Try this one. I want to see this one.” Anyway, it was a real learning experience. We actually had three or four stores by the time the franchise thing came up. That’s kind of a funny deal too, because a friend of mine that was actually in the other industry as well, a guy named Mike Kent Jr., Mike had a real history in the rent-to-own world because he literally worked in the store out in Kansas where rent-to-own was kind of invented. He was one of the original guys on the original team where they invented rent-to-own or discovered this way you could do this. That’s a long and funny story on its own.
Mike really loved the wheel and tire part of the deal, because he was a real car nut. He was always a hot rod guy. In fact, there was even a Hot Wheels with his picture. There was a Hot Wheels named after him and his picture on it. He came to town and said, “I want to see what you’re doing.” I said, “Come on.” We spent a couple of days. He looked at everything. He went, “Man, I love this. I want to do this.”
I said, “No problem, man. Here, I’ll show you everything we’ve learned.” He said, “No, no, no, no.” He said, “I want to call it what you’re calling it. I want to do it just like you’re doing it.” He said, “We’ve got to have some arrangement. Either I’ve got to be a franchise or a licensee or something.” I said, “Well, Mike, you don’t have to do that. We’re buddies, you just go do it.” He went, “Nope, won’t do it. Won’t do it.” That was my entry into how are we going to.
I called my attorney and said, “What can we do?” He said, “Well, you’re not a license agreement because of all of the things you’re going to be doing with Mike like training, all the things you’re doing. You really are a franchise,” he said, “but I’ve known Mike for 25 years and I know Mike will never sue you, so I’ll let you license him to do this. But if anybody else wants to do it, you’re going to be a franchiser.”
I said, “I don’t really want to be a franchiser.” He said, “Well, I know you don’t, but you’re going to have to if you want to do more of it.” He said, “Why don’t you want to be a franchiser?” I said, “Yeah, I don’t like telling other people how to run their business, man.” I said, “I’m an entrepreneur. I appreciate entrepreneurism. I really don’t want to be in that position.” He said, “Well, you’re not going to be good at it, but you’re going to be one.” Yeah, he literally said that.
Anyway, long story short, somebody else called, wanted to come see it. We became a franchiser, and it just caught on and everything was going great. The one thing we were missing, the stores all did well, they were making money, but we weren’t seeing year-on-year growth at the same location. That bothered us. We thought the main reason would be because we weren’t doing a lot of passenger tires. We started bringing in passenger tire displays and we really started trying to market it together, and then it took us a year to figure out the two didn’t go together.
People thought of a custom wheel shop not as a passenger tire place. In fact, you couldn’t see any bays. These were all stores with bays in the back. It really took us a while to figure out what it was we were missing and why we weren’t doing the passenger tire business. We even changed the name to RNR Custom Wheels and Tires, and then later on came up with RNR Tire Express, dropping the wheels out of it all together. The reality is, even to this day, I mean, we do more wheel business than we’ve ever done. The difference is we’re now doing a ton of passenger tire business.
Mike:
I assume tires is the big leader. I mean, because your selling tires and wheels appears to be, “Hey, man, these guys are big at wheels,” when they come in to get their tires.
Larry:
Oh, yeah. It breaks down now to, if you look at our business model today, it’s about 30% wheels and 60% tires, but keep in mind that the 30% wheels has tires on it. That’s that 30, so it’s 30% passenger tires, 30% performance tires and 30% wheels, and the other 10.
Mike:
That’s what’s cool about y’all’s business. I mean, the niche that you guys fill. I mean, look, I talk to people all over the country, and people dabble in wheels, they keep a catalog of wheels, but they never … whereas you guys, I mean, it’s a fundamental part of your business model.
Larry:
Yeah. You can’t be part-time in wheels. I mean, if you look at Discount Tire, Discount Tire, one of my hero companies, because I was a big believer in their culture and the way that … I’ve just had a mind blank. The owner of Discount Tires.
Mike:
Yeah. Me too.
Larry:
Anyway, I just was a real admirer of what they’d done, stayed on mission and that kind of thing, but they weren’t going to ever do a lot of wheels. They had one tree of displays. They’re in the tire business.
Mike:
Well, I was going to compliment you. I don’t want to interrupt you, but one of the things that …
Larry:
Bruce Halle was the name, by the way. Bruce Halle.
Mike:
Yeah. The fact that you guys are disciplined. I even made a note of this to bring it up, the fact that you’re disciplined in tires, wheels and alignments, because I see in this business a lot where a guy starts out in passenger and light truck. Next thing you know, he’s in commercial, next thing you know he’s in the retread business. The reason is because he sees the need in his area and he just adds it on and he just takes it on, but man, the next thing you know, he got a convoluted business plan and it’s just … whereas you guys have really dialed this in to tires, wheels and alignments, and I want to say performance tires too, because that’s a specialty too.
Larry:
Yeah, part of it. Yeah, yeah, yeah. Performance tires are mainly because of wheels, but, well, thank you. I’m a firm believer in keeping it simple, as simple as possible, and staying focused on what you do really well. Oftentimes when you start messing around in these different areas, it takes your focus off of your main business, and then you’re not as good at your main business as you want to be.
We’re a real proponent of what we call serving our customers as opposed to just providing service. It would take two days to really dig into what the difference is, but man, it’s a big difference when you have a concept of serving someone as opposed to just providing service. We found that, when we’ve tried to add different components, it always cost us a little bit about serving the customer.
Early on, we tried parts distribution with one of these catalogs where it was a turnkey deal, where you’ve just really had that and you had parts. I walked in a store one day and saw a guy working with a customer for about an hour over a $29 part, when there’s two or three people waiting in line to get wheels and tires. I went, “That’s got to go. That’s gone.”
Mike:
Well, talk about the repeat business. Let’s say, for instance, that I’m a franchisee. I’m thinking about wanting to franchise this business with you. What are some things to consider? If I was looking at it, I’d be thinking about repeat business. How does that work? Do you see a lot of repeat business? Is it strictly on the tire side?
Larry:
Literally a true story, we monitor that all the time, how much of our new business was repeat business. This past year, 53% of our transactions were second or third or fourth or fifth transactions for the customers that did those transactions.
Mike:
That is fantastic, Larry.
Larry:
It’s amazing, and we manage that number. We want that number to grow every year and be bigger, because we believe in customers for life. That all goes back to, again, that culture of serve not service, is that if we haven’t made a customer for life, we’ve just done one transaction. Wow. Man, what a failure on our part, to not have that. It just doesn’t make sense.
Mike:
Well, that’s huge, though. Well, we’re coming up on our hard stop here, but talk about if someone wanted to look into the franchise, what’s first? Obviously go to the website first?
Larry:
Sure, yeah. You can go to RNR Tires, Tire Express, and on there is a link to the franchise website. You can go to myrnrfranchise.com, which is our franchise website. It tells you, gives you all the numbers that you should expect to see, tells you a little bit about the process and that kind of thing. It has a lot of information, to give somebody enough information to see maybe if they want to make a call. Then if they make a call, they’re going to be talking to our franchise guy and he will talk to them … or she, we have a couple … and they’ll just interview them and see if we feel like they might be right for us, and vice versa. We want them to feel like we might be right for them.
If they are, and they’re financially qualified, then we invite them to attend what we call a discovery day, which is to come to Tampa and we take them out to a store and show them what we’re doing. Then we come in and we meet with them, and really just get down to the down and dirty of what we’re doing and what we’re about. They’re checking us out and we’re checking them out. “Is this somebody is we want to be in business with?” Sometimes that’s no, by the way.
Mike:
Oh, right. Well, look, you want to ensure success, right? I mean both ways.
Larry:
Absolutely. I don’t want to be at the foot of somebody’s failure. That’s just not something that would weigh on my conscience very well.
Mike:
Well, there’s a lot of time and expense in farming through people, and better to cut it off sooner rather than later. Yeah, I admire that approach. Well, so man, we’ve had a good interview. I’m going to have to have you back, but let me finish with a really difficult question, just to let people know a little bit more about you on a personal level.
Larry:
You got it.
Mike:
What’s your favorite movie of all time?
Larry:
Favorite movie of all time?
Mike:
Yeah. If you can’t think of one …
Larry:
Oh, I can think of a bunch. I’m going to have to update it. The new Top Gun movie has taken over, because I’ve never seen anybody do a 25 years later and somehow make the old one relevant. They did an amazing job on that. I just love the movie. I think it’s because there wasn’t any good movies for a long time. I would say right now, forced to answer, that would be my answer, Top Gun 2.
Mike:
Well, I’ll say this. I loved it because, I mean, I grew up when the first one came out.
Larry:
Oh, absolutely.
Mike:
This one, I think this one was better.
Larry:
I agree.
Mike:
I think it actually exceeded the first one. To your point, to be able to take a movie 25, 30 years later and tie it together, relevant …
Larry:
Amazing. A brilliant job, brilliant job. The other thing I liked about it too, one of the best things I liked about it, was Tom Cruise coming out with his talk to you before the movie, thanking you for … that little speech he gives in front of the movie. I was just blown away. I was like, “Well, that was the coolest thing ever, man.” You felt like he was talking to you. It was cool.
Mike:
They did a great job. I think one of the reasons … and you might say this too … one of the reasons I liked it so much was, I guess because it was a sequel, it exceeded my expectations.
Larry:
Totally exceeded my expectations.
Mike:
I felt like I had to go see it, because the other one was one that I was attached to 30, 35 years ago.
Larry:
Absolutely.
Mike:
I thought, “Well, I’m going to go see it.”
Larry:
You had to see it in a theater. You had to go to a theater. You didn’t want to watch that at home. You want to watch that in the theater.
Mike:
No. You wanted to reminisce back in the ’80s a little bit, be back there. Yeah. Absolutely. Absolutely.
Larry:
Larry, I’ve got to thank you for being part of Gain Traction. It’s been a real pleasure.
Mike:
It’s been my pleasure. It’s great to meet you. Love you guys getting the word out about the tires. I love this industry. I never knew about it until 22 years ago, and I love the people I’ve met in it, good friends and great people. It’s been a pleasure, getting a chance to get into a new industry and be a part of it. It’s a lot of fun.
Larry:
You’re a veteran now at 22 years, that’s for sure.
Mike:
Yeah. We’re still learning, though, every day, every day.
Larry:
To all our listeners, thank you for being part of our podcast. If you’d like to recommend a guest to us, please email me at [email protected]. ‘Til next time, be safe and have a great day.
Announcer:
Thanks for listening to the Game Traction Podcast. We’ll see you again next time, and be sure to click Subscribe to get future episodes.
Transcript
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