Document JNo3oMV4XejJ4mMNB8k4RZw0r
We have the vehicle owner on the bot tom but he should be on the top. This whole massive structure is driven by that car own er -- be it a he or she, old or young, im port or domestic car owner. That's what all of this is about -- meeting the consumer wants, desires and needs.
He has several areas to choose. First, he must decide if he is going to fix it himself or have it fixed. If he is going to have it fix ed, which I believe he will do more and more, he can choose from: Auto service centers (K-Mart, Sears,
Firestone):
Specialty service shops (Midas, Precision Tune, AAMCO);
Service stations;
General or independent garages; Vehicle dealers.
We'll talk more about the consumer later and what you need to be doing to satisfy him.
As you can see we are all one big hap py family, selling to and competing with each other on a daily basis. Even some of the manufacturers are opening their own repair shops and selling direct to anyone and everyone. Everyone seems to be hedg ing their bets and covering their flanks by trying to be sure they have ways to the con sumer no matter what choice he makes.
It's in a real confused state now. Eventu ally it will be straightened out but it will take time and some will suffer and go away.
To set the record straight, NAPA doesn't compete in the service arena and we don't ever intend to. We have a few of our in dependent jobbers who have tried and some are still in it, but it would be far less than 1% of our jobbers and they have made the decision on their own.
Here is where NAPA gets its business:
41% -- Garage, service station, body shops;
28% -- D-l-V (as compared to industry averages of 35%-40%);
11 % -- fleets;
12% -- farm;
8% -- industrial/institutional.
That's enough about NAPA. But I thought you should know that I'm not up here saying one thing while we're out there doing something else.
If you recall earlier, I quoted some num bers about the size of the total aftermarket. Here is more detail.
At 1983 retail sales, the total aftermarket was $86.2 billion made up of $59.0 billion in service sales and $27.2 billion in over the counter sales (see chart 2). This includes tires, batteries, oil, accessories -- the works -- plus service labor.
Of the total, you folks participated in 63.9% of the market share in the last two columns. In the service market only, you had 86.1% of the business, or $50.7 billion in 1983.
Let's break this down and look just at service dealer sales. Here, I have 1984 in formation that isn't even released yet. Our good friends at Hunter Publishing are a-
Chart 1
The Distribution of Replacement Auto Parts
Chart 2
The Total Automotive Aftermarket
(Estimated 1983 Retail Sales in Millions of Dollars)
Total Retail Sales
Automotive Service Mkt. Percent Over-the-Counter Mkt. Percent
$59,003 100.0
$27,240 100.0
Total Aftermarket
$86,243
Percent
100.0
Source: Lindsay-Kaufman Company, March 1964
Tire Stores
3,744 6.3
5,066 18.6
8,810 10.2
Auto Supply Chains
2,011 3.4
9,856 36.2
11,867 13.8
Mass Mdrs.
2,489 4.2
8,055 29.6 10,544 12.1
Other: Car Dealers Garages Gas Stations Franchised Jobber Specialists Retailers
24,552 41.6
26,210 445
-
24552 28.5
4,263 15.6
30,473 35.4
Chart 3 in Billions
Total Service Dealer Sales
(Parts and Labor at Retail)
bout to publish their 3 year service job an alysis and Al Joseph was kind enough to let me have some of the numbers listed in chart 3.
The growth in parts and labor since 1973 has almost tripled, just in the last 3 years going from $53.9 billion to $74.9 billion --
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