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The Super Stores


2/1/2005
By Brian Cruickshank

An In-Depth Look At The 20 Largest Store Groups The big distributors in the industry just keep getting bigger. See how the most influential store groups in the industry have grown over the last 12 months.
 

How does the 2005 Super Stores list compare with the 2004 list?

Acquisitions, both major and minor, were a common occurrence in the distribution marketplace over the past 12 months.

Two of the best known of these acquisitions were also among the most surprising to industry observers. As a result of these acquisitions, two staunchly independent, family-run businesses are now conspicuous by their absence on this year's Super Stores list: IAPA member Middle Atlantic Warehouse Distributors Inc (previously ranked 9th) and CARQUEST member Straus-Frank (previously ranked 11th). Both were acquired by different WDs in a major reshuffling of the top store owners in the industry.

The Big Get Bigger
As has been the trend over the last several years, the big are getting bigger. Two years ago, the Super Stores list accounted for 11,611 locations. Last year's list represented 12,339 stores. This year, the number of locations represented by this list grew by better than 5 percent and now accounts for 12,972 store locations, an increase of 633 stores.

On an individual level, last year only O'Reilly Auto Parts grew its store count by more than 8 percent. This year, five store groups grew by at least that amount: Uni-Select, O'Reilly Auto Parts, Midwest Auto Parts Distributors, Genuine Parts Co. and Murray's Discount Auto.

All the store groups on this year's list grew though acquisition or new store openings. Of course, as a result of its acquisition of MAWDI, Uni-Select posted the largest store count gain for any store group, going from just 21 U.S. locations to 161.

It is interesting to note while some distributors reported no new store locations (The Pep Boys, Fisher APW, Hahn Automotive and Auto Parts Headquarters) no distributor on this year's list lost any stores.Here is a recap of some of the store group more notable groups that made headlines in 2004.

 

#1 AutoZone

The nation's largest store owner began its 25th year in business with the start of its title sponsorship of the NASCAR Elite Division, re-named the NASCAR AutoZone Elite Division. The agreement marked the first time all four NASCAR Elite Division series were nationally sponsored.

While AutoZone was growing its reach with NASCAR fans, it was also broadening its store count. In 2004, AutoZone added additional 189 stores (20 more than last year), somewhat falling short of the 200 locations the company originally projected to open. Mixed in among the new store openings was the acquisition of former RPM member, ABC Auto Parts, which added another 17 locations. Currently, the Memphis-based retailer has 3,448 stores in 48 states and the District of Columbia, plus another 64 stores in Mexico.

AutoZone's desire to get more market share from its AZ Commercial division was temporarily punctuated by the hiring of NAPA President Steve Handschuh, who was lured away from GPC to bolster AutoZone sales to the professional technician. That job was short-lived however, and these days Handschuh is spending his working hours in Washington, D.C. lobbying for passage of the Motor Vehicle Owner's Right to Repair Act.

 

#2 Advance Auto Parts

After its November, 2001 acquisition of Discount Auto Parts, Advance Auto Parts, Inc began the long process of changing over those stores into the new Advance footprint. One of the final pieces of that process included the grand re-opening and subsequent rebranding of its Orlando, FL, market stores, bringing 49 former Discount retail stores under the newly conjoined name, Advance Discount Auto Parts. Additionally, Advance Auto Parts invested approximately $4 million to remodel these 49 stores to the new "2010" format, which has already been rolled out to more than 1,000 Advance stores. This new format features a more friendly and logical floor layout with improved product adjacencies, enhanced systems to offer more convenience to customers and high-impact signage underscoring Advance's commitment to "quality parts and products at a value price."

In 2004, the company opened 73 stores, far short of Advance's own projected 125-135 store openings.

 

#3 General Parts Inc.

CARQUEST's largest WD member made headlines a year ago when the Raleigh-based distributor acquired another long-time CARQUEST member, Straus-Frank.

Both GPI and Straus-Frank have been members of the CARQUEST Distribution Group for more than 30 years.

Straus-Frank, also known as Strafco, was also one of the automotive aftermarket's oldest businesses, and was established more than a century ago. Strafco was headquartered in San Antonio, Texas, and operated four CARQUEST distribution centers, which served 317 CARQUEST auto parts stores, including 116 company-owned stores.

As a result of the acquisition, GPI now operates nearly 40 distribution centers and more than 1,500 company-owned stores. The company distributes its products to about 4,000 CARQUEST and other auto parts stores across North America.

Later in the year, GPI completed another major, though far-less publicized, acquisition of Worldpac, a California-based import parts expediter. These two moves - Straus-Frank and Worldpac - continue a consistent trend of very notable acquisitions by GPI over the past several years that have helped to position it as one of the strongest parts distributors in North America.

 

#7 The Pep Boys

Manny, Moe and Jack got a new chairman of the board, as well as a facelift.

Mid last year, the Philadelphia-based retailer announced that current CEO Larry Stevenson would succeed Bernard Korman as chairman of the board. Stevenson joined Pep Boys in 2003 after a seven year stint in the Canadian book retailing market.

He seems to be making an impact. Recent comparable sales for Pep Boys increased 4.1 percent, resulting from an increase of 5.1 percent in comparable merchandise sales and flat comparable service revenue. Comparable retail sales (DIY and commercial) increased 10.3 percent, however comparable service center revenue (labor plus installed merchandise and tires) decreased 3.4 percent.

As a part of its major restructuring and retail renewal efforts, Pep Boys redesigned its retail space, adding 60 new product lines, including some decidedly non-automotive wares such as scooters. For more information on Pep Boys' retail renaissance, see the September, 2004 issue.

In 2003, Pep Boys closed 33 underperforming stores. Over the last 12 months, the outlook for the existing stores looks a little brighter as none of the company's 595 stores were closed.

 

#8 Fisher Auto Parts

Although Fisher Auto Parts made no acquisitions in 2004, the Federated member was dealt a major blow early last year with the unexpected death of Federated founder and Fisher APW CEO Art Fisher. While the year began with a number of exciting changes at Fisher APW, the unexpected death of Fisher was a sad moment for many in the industry. Fisher died Jan. 15 in Staunton, Va., at the age of 65.

However, the company continues on steady ground, thanks to the leadership of Art's son Bo, who learned the business well under his father's guidance.

 

#9 Uni-Select

New to this year's Super Stores list is Uni-Select, the Canadian-based distributor, and member of the formerly named Parts Plus program group.In September, surprising news came out of Montreal that Uni-Select, Canada's second-largest automotive and heavy-duty distributor, had merged with family-owned IAPA member Middle Atlantic Warehouse Distributor (MAWDI). Based in Tonawanda, NY, MAWDI operated 31 distribution centers and 145 corporate stores in 18 states.

The merger, completed on Nov. 1, significantly expanded Uni-Select's reach into the U.S., where it anticipates to generate revenues of approximately $470 million.

All current MAWDI and Uni-Select locations have remained under their original names, but at the corporate level, MAWDI is now operating as a subsidiary of Uni-Select USA. All of the various companies within Uni-Select USA, including MAWDI, are now under Automotive Group USA umbrella.

Clay Buzzard, MAWDI's majority shareholder, was invited to join the Uni-Select board of directors. His son, Jim, was appointed executive vice president of Uni-Select, Inc. and is responsible for Automotive Group USA.

The merger caused an interesting dilemma for two program groups: Parts Plus and IAPA. Since Uni-Select was a Parts Plus member and MAWDI was a significant IAPA member, questions arose as to which group the newly merged company would retain.

The answer came last month when both groups announced a merger to form the Automotive Distribution Network (ADN). ADN is based in Memphis (where Parts Plus was headquartered) and now has co-presidents Mike Lambert (from Parts Plus) and Mike Kamal (from IAPA).

 

#11 Murray's Discount Auto Parts

One of the industry's best-kept secrets, Murray's Discount Auto Stores, has been quietly serving the auto parts needs of Michigan, Illinois, Indiana, and Ohio since the mid 1970s.

It's getting harder for Murray's - now ranked 11th - to fly under the industry radar, as the company grows in both market share and store count. Currently, Murray's has 107 stores, 10 percent more than last year.

To manage Murray's Great Lakes expansion, Lou Mancini was recently named as the company's new CEO, replacing Michael Klein. Mancini has said in his tenure as CEO, he wants to focus on store growth and expanding product offerings while maintaining high customer service standards. Mancini's mandate at Murray's will be to continue the company's store expansion program and expand its product offerings while maintaining Murray's unique retailing culture of knowledge-driven customer service.

 

#20 Autopart International

And finally, the Uni-Select acquisition of MAWDI and the GPI acquisition of Strafco created a vacancy in this year's Super Stores list. The final slot in the list was filled by Autopart International, which operates 61 stores that serve the upstate New York and New England markets.

Editor's Note: Counterman's annual Super Stores list ranks companies based solely on the number of stores a company actually owns. This is why AutoZone is ranked number one with 3,448 stores, while NAPA's largest member, Genuine Parts Co., is ranked #6 with 1,000 stores. While it is true that the total number of stores in the NAPA system is greater than AutoZone's store count by nearly a 2:1 ratio, GPC only owns about 15 percent of the total number of stores that fly the NAPA flag.

Managing Editor Michael V. Freeze contributed to this article.













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