# Are tire stores cash cows? **URL:** \ **Category:** In My Humble Opinion\ **Created:** [July 1, 2014, 5:12pm UTC](https://boards.straightdope.com/t/are-tire-stores-cash-cows/692113 "2014-07-01T17:12:34Z")\ **Posts on this page:** 6\ **Page:** 2
**Author:** ![RivkahChaya](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/rivkahchaya/32/8919_2.png) [@RivkahChaya](https://boards.straightdope.com/u/RivkahChaya)\ **Post date:** [July 2, 2014, 3:05am UTC](https://boards.straightdope.com/t/are-tire-stores-cash-cows/692113/21 "2014-07-02T03:05:29Z")
> [@kunilou](#): > > Let’s do the math. 20,000 people, figure maybe 8,000 cars. With seven tire shops the customer base averages 1,143 cars per shop. Say each car needs a set of tires every three years. You’re looking at 381 sets per shop per year. > > Assume $100 per tire, so each shop is selling $152,400 worth of tires per year. Maybe they can upsell another $100 in services per car. You’re talking about $190,000 gross sales for each of those seven shops. > > That’s just tires and upsells. If they’re also doing brake jobs, mufflers, oil changes, etc. to keep their tire customers, it’ll keep a few people employed. Yup. Like I said, tires can’t wait. No tire, no go. Tires bring people into the shop, then you PMCS the car, and tell them what else it needs, and there’s almost always something. Actually, it kind of scared me, knowing how many people were driving around with tie rod ends and ball joints that were ready to go. Body work will cost you; Emissions make you ill; Engine problems strand you, But front ends kill. ---
**Author:** ![Amateur\_Barbarian](https://avatars.discourse-cdn.com/v4/letter/a/59ef9b/32.png) [@Amateur\_Barbarian](https://boards.straightdope.com/u/Amateur_Barbarian)\ **Post date:** [July 2, 2014, 4:19am UTC](https://boards.straightdope.com/t/are-tire-stores-cash-cows/692113/22 "2014-07-02T04:19:43Z")
Uh, $190k gross sales probably doesn’t pay the rent for a standalone shop. Let alone salaries, taxes, utilities, and overhead. ---
**Author:** ![runningdude](https://avatars.discourse-cdn.com/v4/letter/r/e9c0ed/32.png) [@runningdude](https://boards.straightdope.com/u/runningdude)\ **Post date:** [July 2, 2014, 5:46am UTC](https://boards.straightdope.com/t/are-tire-stores-cash-cows/692113/23 "2014-07-02T05:46:21Z")
> [@kanicbird](#): > > A common business strategy is to open a shop where the competition is doing well. Not to improve your bottom line but to stop their competitions cash cow which could give them a competitive advantage. In microeconomics, this is called a market equilibrium, where businesses will continue to increase the competition to provide a service until everyone is breaking even. ---
**Author:** ![runningdude](https://avatars.discourse-cdn.com/v4/letter/r/e9c0ed/32.png) [@runningdude](https://boards.straightdope.com/u/runningdude)\ **Post date:** [July 2, 2014, 5:58am UTC](https://boards.straightdope.com/t/are-tire-stores-cash-cows/692113/24 "2014-07-02T05:58:51Z")
> [@Amateur\_Barbarian](#): > > Uh, $190k gross sales probably doesn’t pay the rent for a standalone shop. Let alone salaries, taxes, utilities, and overhead. They are getting more than $100 in “up sales”; they are likely averaging several hundred per individual car brought to the shop over several visits. They get loyal customers who will bring their car there for everything, and will get people who shop around, looking for the service each company will do cheapest. Instant Oil change shops do this as well; offering and performing the basic maintenance people would otherwise ignore after getting them in for the oil. Cars are expensive, and the mechanics benefit. I just bought my first car a year and a half ago, and never realized how much it would cost to keep it in tip top shape! ---
**Author:** ![Mr.Nylock](https://avatars.discourse-cdn.com/v4/letter/m/77aa72/32.png) [@Mr.Nylock](https://boards.straightdope.com/u/Mr.Nylock)\ **Post date:** [July 2, 2014, 6:04am UTC](https://boards.straightdope.com/t/are-tire-stores-cash-cows/692113/25 "2014-07-02T06:04:02Z")
> [@Amateur\_Barbarian](#): > > Uh, $190k gross sales probably doesn’t pay the rent for a standalone shop. Let alone salaries, taxes, utilities, and overhead. I would imagine at least 5x that would be needed for anything even resembling a reasonable economic profit. ---
**Author:** ![johnpost](https://avatars.discourse-cdn.com/v4/letter/j/f17d59/32.png) [@johnpost](https://boards.straightdope.com/u/johnpost)\ **Post date:** [July 2, 2014, 3:20pm UTC](https://boards.straightdope.com/t/are-tire-stores-cash-cows/692113/26 "2014-07-02T15:20:35Z")
> [@kanicbird](#): > > A common business strategy is to open a shop where the competition is doing well. Not to improve your bottom line but to stop their competitions cash cow which could give them a competitive advantage. > [@runningdude](#): > > In microeconomics, this is called a market equilibrium, where businesses will continue to increase the competition to provide a service until everyone is breaking even. then the Shoe Event Horizon happens. [Previous page](https://boards.straightdope.com/t/are-tire-stores-cash-cows/692113.md?page=1)