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Selling Road Hazard Warranties

Elon Block

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thanks Elon. What price point is your recommendation for the Road Hazard Warranty.


10% of your retail price of the tire.


For the customer, we have found 10% of the retail equals a number that makes sense for them.


For the shop, selling road hazard is an additional income stream/profit center.


But the biggest benefit for the shop is the long-term impact, which is created because you

will be maintaining the tires for the customer... giving you a natural oppotunity for doing their

oil changes and all of their service needs.


Looking at the big picture, it's not just that one single sale. It's the lifetime value of the customer.

In other words, when you calculate how much a customer spends maintaining their vehicles

over their lifetime, that's equal to thousands of dollars going to your bottom-line.


[This is not even counting how many friends, family members, co-workers, etc that customer

will send to you because you will have positioned yourself as "the trusted shop to get all their

vehicle needs taken care of."]


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Thanks for posting. I find myself in a little different position selling off road tires. You know these are going to be run at very low pressures 6 - 10 Psi. More than likely returned with a stick in the side wall or an impact break from a hard hit on a rock ledge. And in some cases the rim slices the side wall being bound up. How would you handle these type of customers? I have a fellow Jeeper that has completely replaced 2 set of 37" tires through Discount Tire.

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Thanks for posting. I find myself in a little different position selling off road tires. You know these are going to be run at very low pressures 6 - 10 Psi. More than likely returned with a stick in the side wall or an impact break from a hard hit on a rock ledge. And in some cases the rim slices the side wall being bound up. How would you handle these type of customers? I have a fellow Jeeper that has completely replaced 2 set of 37" tires through Discount Tires.

You bring up a good point.


Road hazard warranties are meant to take care of the normal driver out on the road, that may

have an unexpected situation happen. Not the driver that is using his vehicle for sport, etc.

Discount Tires (and all other tire companies I'm aware of) have standard exclusions and conditions,

such as not covering commercial and off-road tires. Here is a link to their website:


So, not sure who sold the warranty to the fellow Jeeper you're talking about... but based on

Discount Tires policies, "off-the-highway tires" are excluded.

In your situation, I wouldn't offer it on any off-road tires you sell. And if the customer brings

up the subject, it needs to be explained to them in a simple, straightforward manner that

warranties are not available on off-road tires.

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I did 10% of the retail price when I was managing tire stores and it worked out perfectly. I could replace a tire under the program, and that made my customers very happy. Not to mention it was an excellent profit center for the stores. Win - win all around. Great advice.

Edited by Shopcat
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  • 2 months later...

I thought I would have it replaced with an updated one before anyone noticed. Guess not. :)

Here's what happened.

Just like you get feedback from your customers, I get feedback. In fact, I constantly ask for

feedback because I want to always be in a position of getting better at what I do.

The back story of that video is..we have two categories of training videos. One category is
for the counter people and service advisors.

And the other category includes management videos for the owners.

When I originally posted that video, I had instructed my webmaster to take the actual sales
training module on "How To Sell Road Hazard" and add one of the management modules to

the beginning of it.

So, the end result was a combination of two training modules. That's what I had posted on

youtube for you folks.

Anyway, I received lots of great feedback on the training portion of the video - the actual

step-by-step, "How To Sell Road Hazard" part. I've had lots of people tell me they are selling

lots more road hazard than ever, as a result of using the sales strategy.

I also had a couple of people question what I meant in the management portion of the video,

when I said something along the lines of many sales people are using the "wing it and hope method" of selling.

I can see how that could be taken as being judgemental or critical. It was clearly a poor choice

of words on my part because I never intended it to be disrespectful.

In fact, I feel the opposite. What I really meant to point out is the fact that times have changed.

What used to work in selling service and tires no longer works with today's more educated,

internet-driven customers.

Even long-term customers no longer just throw you the keys and say "take care of it and call

me when it's done."

Even the most seasoned service advisors and service managers are battling to adjust their

selling methods to a customer that has the exact same labor and parts pricing information as you do.

Anyway, I said all of that to say this...

I have reviewed all of our materials, as a result of this very valuable feedback. The sales

modules do not need to be edited at all.

A couple of our management modules including the short excerpt I had provided for you

folks are in the process of being revised.

I will replace that video for you soon and will let you know when it's up.

UPDATE: The video is now here:

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We just started selling road hazard warranties at a fixed price, averages out to 10% of the tire price. In NY it is illegal to sell warranties without them being underwritten by an insurance company so I had to join a group offered through a supplier to be able to offer it. Customers like the peace of mind, and with a National average of less than 5% payout, seems like a win/win. At first I completely rejected the idea, but I'm warming up to it.


The wording is very specific to exclude off road vehicles, one ton or heavier vehicles, racing, alignment problems, neglect, and abuse among other things.

Edited by alfredauto
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