French tyre manufacturer Michelin has splashed out €70 million on online tyre retailer Blackcircles.com and instantly became the number one internet tyre sales company in the UK and Ireland. The move follows the purchase of a 40 per cent stake in French online retailer Allopneus and gives Michelin further control in the lucrative online market.
Founded by entrepreneur Mike Welch in 2002, Blackcirlces.com has seen growth of around 20 per cent per annum since the introduction of 'Click & Fit' in 2008. The system allows customer to buy their tyres online and have them fitted at a network of 1,200 tyre centres that includes four ventures with Tesco called the Tesco PitStop. Blackcircles.com recorded revenue of €38m in 2013.
Michelin on the other hand only saw a 0.7 per cent increase in tyre sales in 2014 something the two purchases are sure to address.
"Our strategy illustrates our ambition," said Jean-Dominique Senard, chief executive of Michelin. "To be ever more innovative, efficient and proactive for our customers by offering them products and services suited to individual needs, and by simplifying the entire purchase process, from choosing their tyres to having them fitted by professionals."
"I'm delighted to have found in Michelin a partner who shares our passion for customer service, innovation and technology," said Mike Welch, founder and chief executive of Blackcircles.
"The strength of the Michelin Group will allow us to underpin the multi-brand offering that we deploy in each garage, on every street corner. I am convinced that our teams, our customers, our garages and our suppliers will rapidly start to see the benefits of this partnership."