Les Schwab: Pride in Performance
Tire-shop founder's memoir on profit sharing and dealer economics
Summary
Les Schwab founded a tyre retailing business in Oregon in 1952 and built it to hundreds of stores across the western United States. This memoir is his own account of how he did it.
The operating model is the substance. Schwab's central decision was profit sharing at the store level: store managers received a share of their store's profit, which in many cases produced incomes far above what a retail manager would ordinarily earn, and employees participated as well. He argues throughout that this is why the business worked, because managers behaved as owners and made decisions accordingly, and because the compensation attracted and retained people who would not otherwise have stayed in tyre retail.
The service practices that made the brand are covered in detail: staff running to the customer's car, free flat repairs whether or not the tyre was bought there, free rotation and inspection, and honouring warranties without argument. Schwab is explicit that these were commercial decisions about generating return business rather than gestures.
He also covers his refusal to franchise, keeping every store company-owned, and his promotion of managers exclusively from within, generally from people who started changing tyres.
The book is self-published in origin and is a memoir rather than an analysis. The reference has not verified its specific figures. It circulates among founders because the profit-sharing model is stated plainly by the person who ran it and because the connection between compensation structure and service quality is made explicit.
Key takeaways 7
- Store-level profit sharing produced manager incomes far above retail norms and made managers behave as owners rather than as employees.
- Compensation structure rather than supervision is what determines whether frontline managers make decisions in the business's interest.
- Free flat repairs and services performed for non-customers were commercial decisions about generating return business rather than goodwill gestures.
- Refusing to franchise kept every store under direct control, which is what made the compensation and service model enforceable.
- Promoting managers exclusively from within, generally from people who started changing tyres, produced managers who understood the work they supervised.
- Visible service behaviour, including staff running to the customer's car, was specified and enforced because customers notice effort rather than policy.
- The reference has not verified the specific figures in this self-published memoir.
Who should read it
Founders and multi-unit operators interested in store-level profit sharing and its connection to service quality, from the owner who built it.
Where it sits in the reference 2
Who recommended it 1
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