by Jon Owens
Group Publisher, aftermarketNews.com, Counterman, BodyShop Business
AKRON, OHIO — You can point to many industry influences, but none can hold a candle to the importance of programmed distribution. Its evolution within this market has been the single-most influential phenomenon our industry has ever seen.
Nobody sells more automotive products (combined) today than NAPA, the industry’s very first group. With some 6,000 participating outlets, no other entity (program group or retailer) can match their overall reach. From the time they started some 80 years ago, they’ve repeatedly set new standards of performance excellence across many distribution and store functions. You could argue that no program group concept, in any market or industry, has come close to the level of success and brand recognition than NAPA. While they are quite an impressive bunch, the success of programmed distribution does not end with them.
CARQUEST, Aftermarket Auto Parts Alliance, Automotive Distribution Network and Federated are all very strong and influential groups in their own right. Each has a roster of very successful, powerful and highly effective members, all working together to advance programmed distribution and provide real-world examples of just how successful participation in the group can be. It wasn’t long ago that many were predicting the doom of traditional distribution in the aftermarket, after having watched successful retailers like AutoZone and Advance grow at a phenomenal pace. Those comments are rarely heard these days as program group members buy up more stores and WDs to form an ever-expanding, ever-evolving footprint of market share across the country.
A review of our program group chart on page 58/59 of this month’s issue of Counterman reveals additional groups like Pronto, APA and IWD/Auto Pride (among others) with significant rosters and growing brands. So, why has this concept been so successful for this market?
I believe there are two significant reasons. First is the market’s need for vast amounts of highly technical and sophisticated information. Second is the need to effectively manage that information so it can be parlayed into a profitable enterprise. As vehicles became more sophisticated, so too did the parts that were needed to fix or maintain them. Gathering the information required to repair or maintain vehicles quickly became a daunting task, one that could not be effectively achieved by trying it alone. Program groups enabled members to belong to a like-minded community where the efforts of one could benefit many. Of course, this not only referred to application or repair information, but pricing as well. And, as information gathering became efficient and expansive, program groups began to evolve into systems that managed this information and transmitted it across their membership base. From application data to inventory management, pricing to training, customer service to rebate processing and beyond, the management of information became the calling card of program group affiliation.
But the groups themselves have evolved far beyond the basic needs of their members, and today are positioned as some of the most sophisticated retail entities of any market in the world. They have developed very strong brands, helped their suppliers evolve into sophisticated businesses and have advanced the concept of supply-chain management across the entire market.
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