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Posted to alt.home.repair,ca.driving,rec.autos.tech
Jonas Schneider Jonas Schneider is offline
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Default I used to buy tires from TireRack - now SimpleTire (how can they do it?)

On Sun, 2 Apr 2017 02:24:29 +0000 (UTC), Jonas Schneider
wrote:

What is pure profit? Are you talking the difference between the price
they pay and the price they sell the tire? That is far from pure.
OTOH, if you did a cost analysis of the labor and overhead of running
the business I may agree.


Your question is a fair question, since my original assumption was that
tires are a commodity, where it's not the general nature of a commodity to
sell much above it's cost.

Let's go back to that number to see what it was saying exactly.
http://www.moderntiredealer.com/uplo...issue-2015.pdf

That PDF says that there are 200 million replacement tires sold each year,
where, on page 52 of that document, we find the exact words:
"According to a recent Modern Tire Dealer survey of independent
retail and wholesale tire dealers, the average profit margin
on a passenger tire is 26.4%. For a light truck tire it falls to 24%.
The average wholesale passenger tire sales margin is 12.4%."


Here are the definitions:
Sales Margin: http://smallbusiness.chron.com/sales-margin-18383.html
Profit Margin: http://www.investopedia.com/terms/p/profitmargin.asp