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Pep Boys Considers Closing 63 Stores


Joe Marconi

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Pep Boys, after struggling this year financially, is considering closing 63 stores. Pep Boys has been changing the marketing strategy the past few years, emulating what we the independent shop owners do so well: Building strong relationships with our consumer base in our communities.

 

It will be interesting to follow Pep Boys the next few years to see how this all plays out. Below is an article in Tire Business.com.

 

http://www.tirebusiness.com/article/20140915/ISSUE/309159977/reality-check-pep-boys-in-red-considers-up-to-63-store-closings

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They really didn't give a reason for low sales. Ya think people are getting tired of going back for repairs? Could it be the cheap parts and cheap labor...then again, it could be any other reason you could think of too. How about Auto Zone...??? Profits up or down?

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They really didn't give a reason for low sales. Ya think people are getting tired of going back for repairs? Could it be the cheap parts and cheap labor...then again, it could be any other reason you could think of too. How about Auto Zone...??? Profits up or down?

 

I just posted an article link about Autozone; profits are up for them. Pep Boys is different, they sell parts and labor. Pep Boys is understanding that "Cheap" and "Value" are different. It will be interesting to see how things play out the next few years with major players such as Advance, AutoZone, NAPA and O'Reillys competing for the service and part Pie. I just hope we don't get left with the crumbs.

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O'Reillys called me the other day and told me they are no longer doing PCM reflashing in their stores. They said there were too many problems with the system and the company that supported their equipment isn't going to update the equipment. So, they told me they are going to refer all their customers to my shop. Yea... I think....?!?!? Had a couple of calls already but they are expecting it to be free because they bought the computer at O'Reillys. Ah... 'fraid not.

 

All I can say is get used to Mr. General Public. Part stores are changing their standards and a lot of the things they used to do are going to revert back to repair shops ... again.

 

Check your local O'Reillys and see if the same thing is happening in your area.

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  • 5 months later...

I worked for pep boys for 7 years or so, my stock yo yo - d from $2 to $15 per share, up down up down some things never change. They sent me to sunroof school, that idea didn't go too well. People brought in new cars and they had me cut roofs to install $299 sunroofs, at pep boys, think about that for a minute.

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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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