Advance Auto Parts
Careers at Advance Auto Parts
MISSION
Advance Auto Parts Inc (“Advance Auto”) is a leading automotive aftermarket parts provider, seeking to ensure that owners and service providers across the US and Canada have reliable access to a wide range of parts for a large number of models.
FOUNDING STORY
The first Advance Auto stores were opened in 1929 in Roanoke and Lynchburg, Virginia. In 1932, Arthur Taubman purchased the stores and operated the Advance Auto business. The Company was successful but remained a regional operation for much of the twentieth century.
Advance Auto’s first major expansion came in 1998, when it acquired the remaining operations of auto parts retailer Western Auto, the bulk of the company’s operations having been taken over by retailer Sears, roebuck and Co.
The Company continued to expand in the early twenty-first century, acquiring Carport Auto Parts in April 2001 and Discount Auto Parts Inc in November 2001.
Following the completion of its merger with Discount Auto Parts Inc, Advance Auto became a publicly-listed company on the New York Stock Exchange, trading under ticker symbol AAP.
Advance Auto continues to be one of the largest auto parts dealers in North America.
The Company currently operates 4,966 Advance Auto stores and 143 Worldpac branches in the US, Canada, Puerto Rico, and the US Virgin Islands.
Advance Auto has a current market capitalisation of approximately USD 11.38 billion.
Business model of Advance Auto Parts
Customer Segments
Advance Auto distributes auto parts to a wide range of customers across North America.
Its core customers can be organised primarily into the following three categories:
- Automotive Professionals, comprising professional automotive parts installers and mechanical service providers to which the Company provides parts;
- Independent Operators, comprising independent and self-employed automotive parts installers and parts distributors; and
- General Consumers, comprising do-it-yourself customers that are able to install parts themselves from home.
Advance Auto notably serves 1,231 independently owned Carquest branded stores across the US and Canada, as well as in Mexico, the Bahamas, Turks and Caicos, the British Virgin Islands, and the Pacific Islands. Advance Auto is headquartered in the US, which is its core market.
This includes operations across the territories of Puerto Rico and the US Virgin Islands. The Company also operates branches serving customers across Canada.
Value Propositions
Advance Auto provides value to its customers in the following ways:
- Reputation and Standing – Advance Auto has an established reputation in its core markets as a reliable and efficient provider of auto parts, and is among the largest and most well-known operators in its sector;
- Sales and Marketing Reach – Advance Auto has an extensive sales reach comprising outlets across the US – including the territories of Puerto Rico and the US Virgin Islands – and Canada, enabling it to serve customers efficiently from local outlets;
- Accessibility – Advance Auto offers a wide range of products to customers on a self-service basis via its online store and partnership with other online retailers, making its products easily accessible to all customers;
- Wide Range of Products – Advance Auto offers customers a wide range of auto parts and products, including batteries, spark plugs, filters, rotors, and wipers, ensuring that is able to fulfil the needs of a broad range of customers; and
- Customer Service – Advance Auto provides high quality customer care to clients both before and after sale to ensure that customers are satisfied with their purchases.
Channels
Advance Auto makes the bulk of its sales directly to customers via its network of retail outlets.
The Company’s sales network currently comprises 4,966 Advance Auto-branded stores across the US, Canada, Puerto Rico, and the US Virgin Islands, as well as 143 Worldpac-branded branches across the same markets.
Advance Auto additionally serves more than 1,000 independently owned Carquest branded stores across the US and Canada, as well as in Mexico, the Bahamas, Turks and Caicos, the British Virgin Islands, and the Pacific Islands, through which it also makes sales.
In addition to its brick and mortar stores, Advance Auto operates an online store, through which customers are able to browse products, place orders, and schedule deliveries on a self-service basis. The Company also partners with other online ecommerce sites to sell its products.
The Company notably has partnerships with Walmart and Amazon. Both Advance Auto’s physical sales and online retail channels are supported by its logistics and distribution infrastructure.
Customer Relationships
Advance Auto’s principal point of contact with consumers is via its network of brick and mortar stores, which are staffed by dedicated sales personnel who are on hand to deal directly with customer queries, complaints, and product returns.
The Company seeks to provide high quality, personalised customer care across these outlets, with sales staff offering tailored advice and guidance to its customers.
Advance Auto operates a website at www.shop.advanceautoparts.com, which alos functions as the Company’s online store.
The Company offers a range of products through channel on a self-service basis, and provides information on coupons and deals, store locations, guides and advice, and events.
The Company also offers an order tracking and account management service via its online store.
In addition to hosting an online store, the Company is able to communicate deals and updates to its customers through its various social media accounts, including with Facebook, Twitter, YouTube, Pinterest, and Instagram.
Key Activities
Advance Auto provides automotive aftermarket parts to customers across North America, including the US, Canada, the US Virgin Islands, and Puerto Rico.
It serves a wide range of clients, including serving do-it-for-me and do-it-yourself customers.
Through its stores and branches, the Company offers a broad selection of brand name, original equipment manufacturer, and private label automotive replacement parts, accessories, batteries and maintenance items for domestic and imported cars, vans, sport utility vehicles and light and heavy duty trucks.
The Company operates a network of close to 5,000 outlets across North America, and more than 140 branches under the Worldpac brand. Advance Auto also supplies parts to a network of stores operating under the Carquest brand. It additionally operates an online store, through which customers can purchase parts on a self-service basis.
Key Partners
Advance Auto works closely with a broad network of partnership companies that support its core retail and distribution activities.
These partners can be organised broadly into the following categories:
- Supplier and Vendor Partners, including original equipment manufacturers, wholesalers, and other suppliers that provide parts for sale across the Company’s stores, as well as third-party providers of services that support the Company’s corporate operations;
- Affiliate and Marketing Partners, comprising online marketers, bogs and digital publications, and other online businesses that market Advance Auto’s products and services online in return for a commission;
- Distribution and Sales Partners, comprising independent retailers – notably under the Carquest brand – that sell products to customers on behalf of or in partnership with Advance Auto;
- Community Partners, comprising various non-profits and charitable organisations with which the Company works on a range of community and social projects across its markets in the US and Canada; and
- Strategic Partners, comprising various other commercial enterprises and organisations with which the Company collaborates on other business development projects.
Advance Auto has launched a number of partnership in recent years. This includes a strategic partnerships with Walmart and the Midwest Auto Care Alliance, and a retail and distribution partnership with Amazon.
Key Resources
Advance Auto’s business model depends on its ability to provide customers with a wide range of auto parts products reliably and efficiently.
As such, the Company’s key resources are product inventory and supplies, its supply chain and distribution infrastructure, its network of outlets, its online store and IT infrastructure, its partnerships, and its personnel.
Advance Auto notably owns and or leases more than 4,900 branches across the US and Canada.
The Company also owns a number of trade names, service marks and trademarks, including Advance Auto Parts, Autopart International, Carquest, Carquest Technical Institute, DriverSide, MotoLogic, MotoShop, WorldPac, and speedDIAL.
Cost Structure
Advance Auto incurs costs in relation to the acquisition of inventory and supplies, the procurement of third party services, the operation of its network of outlets – including occupancy and utility costs, the management of its partnerships, the implementation of marketing and advertising campaigns, the maintenance and development of its online store and IT infrastructure, and the payment of salaries and benefits to its personnel.
In 2018, Advance Auto recorded annual cost of sales in the amount of USD 5.36 billion, and selling, general and administrative costs in the amount of USD 3.62 billion.
Revenue Streams
Advance Auto generates revenue through the sale and distribution of auto parts to clients across North America.
The Company derives its revenue primarily in the form of sales fees collected directly from customers at point of sale, including across its physical outlets and its online store.
In 2018, Advance Auto recorded net sales of USD 9.6 billion, up slightly on the USD 9.4 billion recorded by the Company in 2017.
The Company recorded a gross profit for 2018 in the amount of USD 4.2 billion. The bulk of the Company’s revenue via its operations in the US.
Our team
info: Tom Greco (“Greco”) joined Advance Auto Parts in April 2016 and has held his current role as President, Chief Executive Officer, and a member of the Board of Directors since August 2016. He is responsible for leading the Company’s overall strategic direction and for coordinating the Company’s Board of Directors. Greco began his career at Procter Gamble. In 1986, he joined PepsiCo, where he served in a variety of senior leadership roles, including spells as Region Vice President for Midwest, President of Frito-Lay Canada, Senior Vice President of Sales for Frito-Lay North America, and President of Global Sales. In 2009, he was appointed PepsiCo’s Chief Commercial Officer, and prior to joining Advance Auto, he served for five years as Chief Executive Officer at Frito Lay.
info: Jeff Shepherd (“Shepherd”) joined Advance Auto Parts in March 2017 and has held his position as Executive Vice President and Chief Financial Officer since April 2018. He is responsible for overseeing the Company’s various financial management functions, including its investor relations units. Shepherd began his career at accounting and corporate services firm Ernst and Young, where he served in a variety of roles between 1994 and 2010, culminating in a spell as a partner of the firm form 2008. In 2010, he joined General Motors as Assistant Controller, following which he served for almost four years as the company’s Controller for General Motors Europe.
info: Sri Donthi (“Donthi”) joined Advance Auto Parts in April 2018 as Executive Vice President and Chief Technology Officer. He leads the Company’s Information Technology function, taking responsibility for Advance Auto’s overall IT organisation, technology platforms and strategic initiatives. Donthi began his career in 1994 at Motorola Inc, where he served for two years as an IT manager before being appointed Director of IT at Motorola Information Technology. He went on to serve as Senior Director from 1999 until 2004. Between 2004 and 2018, Donthi held roles of increasing responsibility at PepsiCo, beginning with a spell as Vice President of Global Infrastructure Management, and later including spells as Global Chief Technology Officer, Vice President, and Chief Information Officer.
