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COMPANY NEWS
Bridgestone Emphasises Integrated Approach to Become ‘Better than the Best’
In recent years there have been substantial changes to Bridgestone’s organisational approach to the European market, not least an amalgamation carried out during 2014 of the company’s organisation for the marketing of its new truck and bus tyres with its Bandag retreading business. We recently took the opportunity to talk to Steven De Bock, the Director of Bridgestone’s Truck and Bus Commercial Unit at Bridgestone’s European Headquarters in Belgium to discuss the current state of the truck and bus tyre market as well as Bridgestone’s approach to the challenges the market is currently presenting.
According to De Bock, 2015 new tyre demand is more or less on a par with 2014 but retreading is dramatically down. This, he says is not exclusively down to the influence of Chinese tyre imports but is mostly due to that. Despite this, he points out that new tyre prices are generally down, driven by low raw material prices. “Casing prices are also dropping,” he adds, “and this is also having an impact. Overall, we believes market demand won’t get back to the levels from before the crisis, but at Bridgestone we are still seeing increases in the first quarter compared to last year.”
On the subject of retreading De Bock points towards one of the key differences between Bridgestone’s approach to the market compared with the other major premium manufacturers, namely that, unlike the others, who are mainly focused on mould cure retreading, Bridgestone remains committed to its Bandag decentralised pre-cure network.
“The decentralised model as operated by Bridgestone in North America
Steven De Bock,
the Director of Bridgestone’s Truck
and Bus Commercial Unit at Bridgestone’s European Headquarters
works well,” he says. “We are not quite at that stage in Europe yet but we started our journey towards that model two to three years ago. We are starting to see the benefits now.”
Last year Bridgestone changed its organisation in Europe to fully integrate the previously separate teams covering new and retreaded tyres. This, points out De Bock, has helped focus the direction of the organisation and has helped avoid a situation where different marketing departments are doing their own thing in the market. In order to emphasise the highly developed integrated organisation the company has in the US, the European organisation is currently in the process of taking groups of European Bandag franchisees over to the USA to see how franchisees work together and with Bridgestone to optimise the approach to the market.
“We are convinced that the degree of customer intimacy between fleet customers and local Bandag dealers is vital in terms of understanding the needs of the customer. Our individual partners know what’s critical because they know their customer base.”
De Bock accepts that Bridgestone has some wholly owned mould cure facilities in Europe (SLBR in France and Bulldog in the UK). However, he insists that the aim is not to create equity all over Europe. “It’s not our intention to grow this area,” he stresses. “In general, we don’t believe in equity outlets. We believe in the entrepreneurship of our Bandag dealers, and our main aim is to make them as loyal as possible.
“We believes that what needs to be developed in Europe is the mindset that we have in North America, where
Bridgestone and Bandag have seamlessly become one company. In the US the focus is on reutilising the asset of the fleet. In Europe there is still too much emphasis on price, so the approach to casing management and asset management still has some way to go. We want to create this mindset in Europe. We thought our plan to take dealers to the US might help instil this new mindset and help give dealers some new ideas of how to approach the fleets.”
In the US Bridgestone offers Bandag dealers a financial model whereby business consultants work with dealers to help them improve labour costs/productivity etc. According to De Bock, the European organisation is trying to develop a financial model but De Bock admits it is proving less easy to persuade entrepreneurs to open up. “We are trying to get the message across to dealers that we’re here to help. In the US, for example we have a panel of dealers who sit together to compare performance in order to achieve optimisation of their individual businesses. We realise that this is a big change in approach for entrepreneurs, so we realise change will take some time.”
A key part of Bridgestone’s integrated approach to the market can be seen in the company’s latest developments in terms of its truck tyre service channels and the development of the new Bridgestone Partner network, which replaces the previous Truckpoint network.
“Truckpoint was successful,” says De Bock, but the network was to some degree neglected, and we didn’t invest enough in it. We are therefore revitalising our approach by launching the Bridgestone Partner programme.”
According to De Bock the creation of Bridgestone Partner is a critical step for the company as it signifies a decision to move away from a sell-in oriented channel approach to a sell- out approach.
“The channel is there to give a comprehensive fleet offering,” explains De Bock. “For this reason it is impossible to separate Bridgestone and Bandag. Our aim is to change from being a tyre salesman to being a consultant. To achieve this we need to work together with dealers to persuade customers that we are bringing the necessary value. We are therefore placing lots of emphasis on quality of service, and our aim is to develop fleets together with dealer partners, who are best placed to develop direct contact with customers. Our aim is to develop with our partners so they can offer mileage contracts with confidence.” According to De Bock Bridgestone is slowly gaining ground in the overall fleet solutions business. An integral part of the process of developing into a fleet consultant is TPMS and software packages for dealers and fleets. The company has instigated a companywide training programme to train staff, dealers and fleets in the effective use of its software tools. This is a big investment,” says De Bock, “and implementation is a five to six year process. We are already seeing a big change. Our sales force now all have our Toolbox, which has dramatically improved the speed and power of information within our organisation.
“Our approach to the market is influenced heavily by our parent company in Japan who stated aim is that ‘we don’t just want to be better than the best – we want to be the best by far.’ This is a powerful message, and relates not just to market share but also to the nature of our organisation and the mindset of our employees. We are now aiming to convince dealers that this approach is the right way. We are not just trying to transform our own future, but that of our partners too.”
54 Retreading Business