Goodyear Tire and Rubber CompanyWith the competitiveness of the U.S. tire industry in 1992, Goodyear Tire and Rubber Company is reconsidering Sears department store's proposal to market Goodyear Eagle brand tires. With a $38 million loss in 1990 and a change in senior management in 1991, the 1989 Sears proposal came under scrutiny again. These new high-level managers must make two decisions: whether Sears should market only the Goodyear Eagle brand or the entire line of Goodyear tires. Goodyear will have to consider its distribution policy and the potential backlash that could arise from independent franchised dealers. Key Factors in Competition in the U.S. Tire IndustryPrice plays an important role in the tire industry. Many consumers purchase their tires based on price, as they know little about tires and are more focused on getting a good price versus a better quality tire. Customers who know more about tires or cars look for the quality of tires for their vehicles. At the retail level, sellers are pressured to sell one store's private label tires before any other. This is difficult to do when a customer is brand loyal. To be competitive in the U.S. tire industry you need to have a variety of offerings. Tire companies must have a strong mix of portfolio offerings to remain competitive in the industry. The United States has many different climates, with both extremes of rain and ice. By having an extensive product line, you will be able to satisfy more customers in every demographic. Branding and reputation are another important factor in the US tire industry. When trying to create a competitive advantage in the tire industry, branding and products... in the middle of the paper... are generally not knowledgeable about tires and their different characteristics.Pros/Cons for Franchise Tire DealersPRO- This change in channel selection by Goodyear allows franchised retailers to begin carrying private label brands and create a larger one. Goodyear will most likely have to subsidize a loss of sales with increased promotional support and lower prices. The overall branding will improve for Goodyear, as there are more offerings available to the public. CON-The offerings could be cannibalized from its own sales and shifted to Sears.-The lack of supply could also become a Goodyear production that cannot meet demand from both franchised dealers and Sears Auto Centers.-The entire lineup offers Goodyear franchised dealers might seem overpriced if Goodyear produced a lower, cheaper tier of tires exclusively for Sears.