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Advance to Purchase GPI CARQUEST


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I just read a news feed that says Advance Auto is set to purchase GPI/CARQUEST. This is big news. It looks like this will make Advance Auto Parts the dominant player in the auto parts business, supplying parts to the industry.

 

As many of you may know, Advance purchased BWP/CARQUEST the first of this year, 2013, in my area of the country. From what I see, Advance is making an real effort to understand the independent repair shops and is eager to form an alliance with the shops. We all know they will not give up the retail trade, but this consolidation of two large groups will prove to be a powerful force.

 

Below is a link to the article.

 

http://stream.wsj.com/story/latest-headlines/SS-2-63399/SS-2-355355/

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I think the purchase of BWP by Advanced at the beginning of the year has yielded pretty solid results so far. I was very skeptical at the beginning but am becoming much more comfortable with the process. Advanced brings massive purchase power and warehousing/distribution muscle to the table. The changes in product lines are ok in some cases, not in others though. So far they have kept on most of the BWP personnel, which has been key. BWP/Carquest has done very well in the wholesale market due to their sales and counter personnel being far superior to the competition. This is something Advanced could not duplicate on their own. The API venture is a miserable failure and despite much lower prices was never able to grab significant market share in the wholesale sector. I believe that is why Advanced became interested in the Carquest brand.

 

For those of us in the northeast that were previously served by BWP I don't think there will be a significant change beyond what has already been set in motion. Worldpac is key for certain parts for us, Volvo and Saab parts they tend to have stock where our other supplies don't and that helps but we just use Worldpac to fill in the gaps where other warehouses fall short. I am not a fan of their WorldSource line, its pretty low quality. In the long run I wouldn't be surprised to see that product line and the API branded products all becoming one low qual/low cost line. There is a market for that stuff, just not at our shop.

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Advance auto parts and CARQUEST are our main 2 suppliers currently for parts. Both seem to have their pro's and con's. Hopefully a merge with these 2 companies will get rid of some of the cons from both companies and reinforce the pros. Just from reading a little blurb from the link to the article, I never realized AutoZone was such a big player in the aftermarket parts. We rarely every purchase parts from AZ.

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  • Have you checked out Joe's Latest Blog?

         13 comments
      Most shop owners would agree that the independent auto repair industry has been too cheap for too long regarding its pricing and labor rates. However, can we keep raising our labor rates and prices until we achieve the profit we desire and need? Is it that simple?
      The first step in achieving your required gross and net profit is understanding your numbers and establishing the correct labor and part margins. The next step is to find your business's inefficiencies that impact high production levels.
      Here are a few things to consider. First, do you have the workflow processes in place that is conducive to high production? What about your shop layout? Do you have all the right tools and equipment? Do you have a continuous training program in place? Are technicians waiting to use a particular scanner or waiting to access information from the shop's workstation computer?
      And lastly, are all the estimates written correctly? Is the labor correct for each job? Are you allowing extra time for rust, older vehicles, labor jobs with no parts included, and the fact that many published labor times are wrong? Let's not forget that perhaps the most significant labor loss is not charging enough labor time for testing, electrical work, and other complicated repairs.  
      Once you have determined the correct labor rate and pricing, review your entire operation. Then, tighten up on all those labor leaks and inefficiencies. Improving production and paying close attention to the labor on each job will add much-needed dollars to your bottom line.
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