In the next 5 to 10 years, online sales for tires is expected to double. The click and fit will bring about transformation in the automotive industry and the experience in which customers buy the tires for their cars. The online sales of tires will thrive in the European market as the online channel offers convenience and the products come with a lower price tag.
The automotive aftermarket can sell online tires with ease. The major tire companies manufacture and distribute their own products, and also install them with the help of their respective company service centers or through a franchise. Furthermore, tires are like to do your own installation product, this further enables the user to choose the best online deal instead of visiting a service center.
Thus, the growing business of selling tires online has also attracted conventional e-retailers, hypermarkets, and auto parts retailers. Everyone is getting attracted to this category because of the percentage of its total automotive parts sales is approximately 20%. The other companies entry is also enabled by the online shopping space i.e. click and fit the business.
Customers prefer to buy the tires online as prices are lower as compared to the retail market. These tires reduce the retailer inventory cost by not leaving the warehouse until and unless it is purchased or the payment is made. The Internet, which acts as the medium for transaction, also helps customers search and compare brands as well as prices or services and any other special offers.
Allopneus, a France based company, and Delticom, a Germany based company are dominating the emerging markets with their online tire sales. These companies buy tires from the manufacturers, stores them in the warehouse, and ships them to the specific locations based on demand. These companies accept orders online as well as through call. They partner with the smaller brands for effective distribution.
In the long run, it is expected that the above strategy adopted by the two companies for distribution will be followed by the tire manufacturers to widen their distribution network. Furthermore, the tire companies will be targeting the car leasing companies as one of their growth strategies from medium to long term. As the overall industry is shifting from ownership to a leasing model, tire manufacturers are also expected to bank on the opportunity.