Auto Parts Business
 

I am looking at buying a local auto parts business. Anyone here been in the business or have any information to share. Looking at a NAPA store in a small town. Thanks. Spencer

I have never been in the business, but I live in a small town that had three fairly vibrant auto parts stores.

Then Auto Zone moved in.

Two of the three are out of business, the third, a Napa store, seems to be creeping along, a bit looply.

In your business plan, make sure you look at the AZ model, what demographics they target, etc., so you're not prey.

I wish you the best...business plans, homework to minute, stupid levels of detail are your best defense.

What info are you looking for???

I have a friend who owned one a long time ago, would you like to hear from him?

My comments will probably not help your business plan but my thoughts on auto parts stores from my experience. It seems to me that Discount Auto,Autozone,Pep Boys cater more towards the ricer/minority crowd and are not very professional in their presentation to the public. In my experience my local NAPA stores have better trained employees, the stores seem to be more professional and they offer services like making hydraulic hoses as an example. Right or wrong I also believe the quality of the parts that NAPA sells is better than the competitors. Sorry if I come off as less than politically correct but my local NAPA everyone speaks English............not so much at other stores.

Thanks for the comments. Looking for any and all information ya'll may have to share. I am just beginning to meet and talk with the Napa folks and I guess I am looking for any info on the pitfalls of doing business with napa. The store I am looking at has traded hands at least 3 time in the past five years. Current guy claims to be giving it up to work the car repair business he has out of the basement. Will be taking a look at the books before I spend any of my money. Lots of talk of me putting up 100K for 500K of stock. Thanks. Spencer

100k for 500k in stock? Is the 500k inventory valued at cost or retail?

Look at the books and the tax returns.

Sent you a PM....might be helpful.

Steve

Fixed it for you.

One other thing, what is your market, are there dealers that are currently served, car lots, ect??? What over parts stores are near?? Does he have an established clients list?? One of the things that made NAPA so popular is the fact that they deliever & maintain stock in car lots, & garages, still supply parts to dealerships as well. Own or lease the building, how many employees, any sales reps???? I worked for a parts supplier for years, learned many aspects of the business, NAPA was a compeditor, and I would be happy to help.
A very good friend was a NAPA rep for years until Continental Tires made him an offer he couldn't refuse.. PM me any questions and I'll pass them along to him..

byron has brought up very good points

what is your intended area of influence? How many shops can you supply to , that are thriving ? no need to take on dead beats ! Talk to those shop owners to see how business is doing, not as a new parts store owner. You would get two different answers. What does the local public economy look like? Lots of for lease signs? not good ! Do the cars circulating in your area meet the range of parts sales that are most common ?
3 different owners in 5 years would give me a pause for concern! And the current owner looking at REPAIR being more profitable? hmmm....

Lots of good stuff. Thanks. There are no dealers here and no car lots. There are about 3 small car repair places with another 12 miles south. The area is not thriving and the economy here is fair to poor. I do not know yet if the 100K is cost or retail. I am thinking retail. The biggest customer is the county shop. Spencer

I'd be sure that the employees are going to stay. You'll want to retain the talent so you're not scrambling to find decent people when you take over.

Additionally I'd speak with the local auto repair places and get their opinion of the place. They might end up being your best customers.

overall there could be worse things to do. NAPA is a strong buyer (i sell exhaust to them) and has some good stuff. They have alot of benefits to them, but there is also a strict buying program. they don't like when you buy stuff from outside places and they will be marking up stuff 25% or more to you from manufacturer prices.
One of the bad things(for me) is that they pay labor claims ...so that can be good or bad for you. The stores will eat this sometimes. The quality of the staff has enormous effect on the $ you make, In Rural GA are you gonna be sticking to domestic only or a mix of import/domestic? you need to study the market there, go talk to some of their customers.
Be prepared to hear "i can get it for less on the internet"...allot.:rolleyes:

I think spencer answered his own questions with his assessment of the area.

As they always say in real estate : Location, location, location

best wishes

exactly

put that money to work in stocks or something

Thanks everyone. I am going to meet them Friday morning for a breakfast meeting. They must be thinking they have a guppy on the hook. Not going to be me. As far as the stocks go, I have been putting my money into things like utilities that pay a good dividend. There's no interest being paid around here. I will follow up on Friday. Spencer

I believe the (auto) parts business is on a plateau and starting to slide downward based on all the chit chat I hear .........................I'm on the repair side

What is your plan to combat the growing online business? I buy more than 80% of my parts online... Only reason I go deal with the morons at Oriellys is in an emergency... And then they usually don't have what I want....

When I have a car job coming up and can plan a weekend for it, then yes, I order all my stuff online way ahead of time. But when I realize the wife's brake pads are paper thin and I know any local car shop has them in stock for about the same price as anyone online (sales tax and shipping being roughly equal), I run to the local shop. There's a small chain called Fairfax Auto Parts in VA and they are AWESOME. I'd always go to them over the big players. They stocked ATE brake fluid, Pentosin and Dextron ps and atf fluid, had all kinds of oddball metric stuff I needed and were just a great shop. You can differentiate yourself from the big stores with quality products and service.