Autozone Industry Analysis

AutoZone began as an idea from J.R. “Pitt” Hyde III. Pitt opened Auto Shack a retail auto parts store on July 4, 1979, after seeing people needing help with the upkeep of their automobiles. In the year 1987, the name was changed to AutoZone, in 1991 AutoZone presented on the New York Stock Exchange. AutoZone is a Fortune 500 company operating in 48 states throughout America, It has locations in Mexico and Puerto Rico, employing around 65,000 people. AutoZone pledges always to put customers first, to know their parts and services and maintain a clean environment, stating they provide the best price and the right merchandise (autozoneinc.com)

AutoZone’s primary industry is best categorized as the auto parts retailer industry since they sell an assortment of brand name and private label auto parts to consumers and commercial customers (Parnell, 2008). As a result, AutoZone’s primary industry would include companies such as, O’Reilly’s Auto Parts, Advance Auto Parts, Napa Auto Parts, and a litany of small family owned businesses that specialize in selling auto parts. AutoZone’s secondary industry includes a plethora of companies, such as, new car dealerships, giant discount stores like Walmart and Target, convenience stores, and Amazon, since they sell a multitude of products also sold by AutoZone and other stores in their primary industry. Therefore, the auto parts retailer industry

Auto Zone’s industry would be the aftermarket parts industry. This industry would include the wholesale and retail sales of vehicle parts, tools, accessories, and fluids mainly for automotive use. A wide array of stores sell these products either online or at their brick and mortar locations. Some of stores include, Advance Auto Parts, O’Reilly’s Auto Parts, NAPA, Wal-Mart and Amazon.

AutoZone has been in the automotive aftermarket industry for over 30 years. AutoZone was created by J.R. “Pitt” Hyde as Auto Shack. Auto Shack was eventually renamed AutoZone, and is now a Fortune 500 company Today, AutoZone is the United States’ leading retailer of automotive replacement parts and accessories with more than $8.1 billion in annual sales. They sell auto and light truck parts, chemicals and accessories. There are AutoZone stores in 49 U.S. states plus the District of Columbia, Puerto Rico, Mexico and Brazil. They employ more than 65,000 employees. In addition, they sell automotive diagnostic software through ALLDATA. AutoZone has ecommerce capabilities through AutoZone.com and alldatadiy.com. Their number one priority is customer satisfaction, and they consider their best product “Trustworthy Advice” (AutoZone, Inc., 2015).

All too many times individuals will misconstrue the definition of the word industry, in considering that a single business is the industry. However, Parnell (2008) defines the term industry as “a group of companies that produces competing products or services” (p. 38). For example, the local pizzeria would not be a representation of the entire pizza industry, but rather being a part of the food industry. Now that the terminology is understood, it is time to define the type of industry in which AutoZone is within. According to AutoZone, Inc. (2017) the organization serves in the automotive aftermarket industry. The automotive aftermarket industry simply is explained as a secondary market that specializes in the refurbishing and selling

Autozone founded by J.R. Hyde III. Opened Auto Shack in 1979, an automotive parts store. Autozone became the official name in 1987. Hyde built his business on the big box stores business model and focused on smaller trade in the South and Southeast, highlighting service and every day low prices. The auto parts retailer experienced early success and grew to nearly 200 stores by 1984 (Parnell, 2014). AutoZone operates eight distribution centers in the U.S. compared to 28 facilities for O’Reilly Auto Parts, one of its principal competitors (Memphisdailynews.com, 2015).

I would define Autozone in the automotive industry based off the primary products they retail. I would include the dealership and the fellow discount automotive stores in this industry as well. Industry is defined as a group of competitors that produce similar products or service ( Parnell, 2008 pg 38). By this definition dealerships and aftermarket automotive discount stores would fall under this category. When a consumer thinks of a dealership they immediately think of purchasing a new or used vehicles, this assumption is a valid thought. The dealership offers so much more than new or used vehicles, in fact dealerships offers car washing (detailed), collision repairs, and parts and services on vehicles.

The purpose of the report is to provide Wand Inc. a recommendation from the following choices: -

Although the NAICS primary industry code is that of retail trade, it does further delineate it to auto supply stores principally selling automotive parts and accessories (Siccode.com, 2017). Understanding the competitors of the primary industry, as well as being able to identify ancillary industries, helps to clarify the industry more effectively. Consequently, I would not include new car dealerships or discount stores in this primary industry.

Autozone started as a small retail auto part store in the late 1970’s. Auto Shack was founded by J.R. “Pitt” Hyde III. Auto Shack was the first name that was given to the company. AutoZone official name was given in the 1980’s. Autozone made their first impression in New York stock exchange in 1991 (Autozone, 2014-15). Autozone become one of the first auto part store that was able to put in customer warranties in a computer database. By allowing the company to increase in technology devices that allows the company to help each autozone communicate between stores. By using this business structure helped Autozone increase their sales significantly, banking up to 1.5 billions dollars in sales. In 1995 Autozone created their own Duralast and

AutoZone was a vision from the mind of J.R. “Pitt” Hyde III after receiving his bachelor’s degree in economics. After receiving his degree he joined his grandfather’s wholesale food store Malone & Hyde’s retailing division. Pitt utilized the corporate profiled to identify several industries the wholefood store operated. The company incorporated drug stores, sporting goods stores, and supermarkets to operate in multiple unrelated industries (Parnell, J., 2016).” “Pitt saw a need for a retail automotive parts store to help with upkeep of their vehicle so he created Auto Shack (AutoZone, Inc., 2004 -2017).”

As AutoZone increasingly establishes more international growth, they will continue to maintain their culture as a company that places the customer first. AutoZone continues to follow and adapt to new customer trends as well as adopting new annual themes that facilitate and promote further success and increased diversity. According to Rhodes, “As we have learned from our predecessors, by taking care of the customer, they will give us many more reasons why they shop with us than we could ever give them ourselves” (AutoZone Inc., 2015, p. 26). The company’s long term pledge has been to always put customers first. Additionally, AutoZone further supports their customers through their two websites, autozone.com and autozonepro.com, which provide tutorials and mechanical advice online to customers and anyone else visiting their site. AutoZone has two key positioning strategies, which are physical location and time. Because

Auto Zone has responded positively to the changes in its microenvironment. The company has managed to keep up with the many changes in the economy. Changes in the economy can cause an increase or decrease in gross domestic products. Gross domestic products can affect some industry more than others, especially those in global markets. (Parnell, 2013). “Over the past 15 years the auto industry has shifted from a regional industry to a global industry, as a result of this shift the original equipment supplier base has been pulled in the same direction” (Santucci,1997, p.1) Auto Zone has keep up with changes and shifted into the global industry as well. The company has stores in all 50 states and now has expanded globally into Mexico and Brazil."Expanding

Industry definition: "Companies in this industry manufacture cars and automobile chassis. These operations, which are referred to as automakers, typically produce cars, including electric cars, in assembly plants. The manufacture of light trucks (e.g. vans, pickups and SUVs), heavy trucks and motorcycles is excluded from this industry." [2]