O'Reilly’s $10 billion bid to buy NAPA
- Thread starter Creekside
- Start date
I always think the consumer having more choices is a good thing. However, given that the only difference between what O'Reilly sells and what Napa sells is the sticker on the box, the price, and if it's in stock, I'm not sure how much it even matters.
I do think a fully corporate model has many advantages to you, as a customer, over a franchise model. Remember that in a franchise, the business owner is Napa's client, not you - you almost don't matter to Napa. On the other hand, when you shop at a corporate location, you're their customer. In theory this means you'll have a more consistent experience, inventory management will likely be better, issues are easier to resolve, and it could even lead to better pricing.
This whole thing goes beyond auto parts though... For example, McDonald's is NOT in the food business, they are in the real estate business. We bought our Equinox EV from the Chevy dealer, not GM.
On the other hand, it also means individual stores don't have the flexibility to customize what they offer. For example, I've heard of franchised Napa stores carrying AMSOIL... something a corporate store couldn't. Also, the owner of a Napa store has more power to go above and heyond than the typical manager or even district manager of an O'Reilly.
Anyway, O'Reilly DOES have a franchise program. It's called Parts City. Never seen one IRL and I think there are only a handful around the country, but the direction I think it could go if they end up acquiring Napa is that they take over the corporate owned Napa stores where it makes sense and spin off the franchised ones that either redundant or where there are anti-trust concerns into something else.
Napa or not, there does seem to be a push to increase O'Reilly presence in heavy duty, ag, fleet where Napa has traditionally been stronger. I think in a world where rapid cost increases and supply chain issues are probably the biggest concern across many industries - auto parts, computer chips, minerals/"rare earths" etc. a company like O'Reilly might be able to weather that storm better than Napa can.
In the last decade so many parts have been transitioned from name brands to store brands. In many cases the part inside the box is the same (although oftentimes it's not). But when you are selling a Murray idler pulley, you can buy it from whoever you want. If you buy them from Gates, if Gates wants too much money or doesn't have any, well, just buy them from Litens. Litens doesn't have any? Well, find some random Chinese supplier - as long as it works, who cares. And even if it doesn't last more than two years, it's OK... that's what the warranty is for. Napa does have an advantage here because they already mostly sold store brand stuff.
The funniest thing is still the recalls where the recall is because the part came to the auto parts store in a Napa box. Even though, well, I don't work at a Napa auto parts store. Just makes me laugh because of how many hands the stuff had to pass through to end up stocked on the shelf (even if it's in the back of the store). You don't need to be an ASE certified mechanic with two decades of experience to realize that probably doesn't belong there.
I do think a fully corporate model has many advantages to you, as a customer, over a franchise model. Remember that in a franchise, the business owner is Napa's client, not you - you almost don't matter to Napa. On the other hand, when you shop at a corporate location, you're their customer. In theory this means you'll have a more consistent experience, inventory management will likely be better, issues are easier to resolve, and it could even lead to better pricing.
This whole thing goes beyond auto parts though... For example, McDonald's is NOT in the food business, they are in the real estate business. We bought our Equinox EV from the Chevy dealer, not GM.
On the other hand, it also means individual stores don't have the flexibility to customize what they offer. For example, I've heard of franchised Napa stores carrying AMSOIL... something a corporate store couldn't. Also, the owner of a Napa store has more power to go above and heyond than the typical manager or even district manager of an O'Reilly.
Anyway, O'Reilly DOES have a franchise program. It's called Parts City. Never seen one IRL and I think there are only a handful around the country, but the direction I think it could go if they end up acquiring Napa is that they take over the corporate owned Napa stores where it makes sense and spin off the franchised ones that either redundant or where there are anti-trust concerns into something else.
Napa or not, there does seem to be a push to increase O'Reilly presence in heavy duty, ag, fleet where Napa has traditionally been stronger. I think in a world where rapid cost increases and supply chain issues are probably the biggest concern across many industries - auto parts, computer chips, minerals/"rare earths" etc. a company like O'Reilly might be able to weather that storm better than Napa can.
In the last decade so many parts have been transitioned from name brands to store brands. In many cases the part inside the box is the same (although oftentimes it's not). But when you are selling a Murray idler pulley, you can buy it from whoever you want. If you buy them from Gates, if Gates wants too much money or doesn't have any, well, just buy them from Litens. Litens doesn't have any? Well, find some random Chinese supplier - as long as it works, who cares. And even if it doesn't last more than two years, it's OK... that's what the warranty is for. Napa does have an advantage here because they already mostly sold store brand stuff.
The funniest thing is still the recalls where the recall is because the part came to the auto parts store in a Napa box. Even though, well, I don't work at a Napa auto parts store. Just makes me laugh because of how many hands the stuff had to pass through to end up stocked on the shelf (even if it's in the back of the store). You don't need to be an ASE certified mechanic with two decades of experience to realize that probably doesn't belong there.
interesting. I spent my high school years in Springfield and used O'Reilly for a lot of stuff (1965-1969). They had an excellent paint supply shop downtown also.
Since we lived on the Northside of Springfield we also used their main competitor Stinger Sam (former Stenger Auto Supply, now mostly defunct). In the smaller Ozarks towns, O'Reilly was the only game in town after noon on Saturday, and they grew from there. Never did I believe they would be such a powerhouse supplier.
Since we lived on the Northside of Springfield we also used their main competitor Stinger Sam (former Stenger Auto Supply, now mostly defunct). In the smaller Ozarks towns, O'Reilly was the only game in town after noon on Saturday, and they grew from there. Never did I believe they would be such a powerhouse supplier.
Autozone & O'Reilly do not franchise, It's weird either one would be interested in a franchise model
Technically, O'Reilly does... but it's called Parts City, and there are only a handful in existence. So it's entirely possible that they acquire Napa and any locations where anti-trust or duplication is a concern they end up spinning that thing off into something else... but still act as the supplier like they do to Parts City locations.
They push inventory on you don't want/need that YOU warehouse & pay tax on that they have access to anytime they want
Yeah, personally don't think I'd ever want to franchise/own an auto parts store!
I thought about opening one at one point but trying to stay truly independent and focus more on ag parts(bearings, seals, chain, sprockets, sheaves, filters, etc.) There is a large amount of older people/farmers here who would be glad to get name brand parts if you could figure out timing to do something like a large rockauto order a couple times a week. Many farmers around here still use flip phones.
I follow Crescent Bearing on social media and am completely envious of what they have built. That variety is what I really like.
Looks like there's quite a few of them, actually. There's one about an hour away from me and if you go to their store locator map and move around, they pop up on their map.
Maybe they want into the franchise business?
Or maybe they figure out who the best franchises are and buy them out. Can work out well especially if the franchisee is getting older and has no heir that wants to take over.
Or they learn which are selling the most and set up a bunch of corporate stores in the neighbourhood to steal the business.
Lots of ways to skin that cat.
O'Reilly should just open stores in the closed AAP/CQ locations. Don't buy Napa.
For the NAPA fans, where is your preferred store in relation to an O'Reilly's location ? If you're a shop, you probably don't care since they deliver to you. If they're relatively close, you can count on the NAPA location to be shut down, I'm afraid. Or, they're located in less-than-ideal locations today, whereas years ago, their location was sensible.
Not very convenient around here. Lawrence has one NAPA in an old Sears catalog store building (franchise), pretty small. In surrounding counties east most of them closed in the 1990's. Closest corporate store is 40 miles away adjacent to their large warehouse in KC KS Metro area.
In contrast, O'Reilly has two stores in Lawrence and another in a small town 12 miles away from me.
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Based on my last visit 20 years ago there was absolutely no doubt they had no interest in servicing a retail customer, so I think your correct in that it doesn't matter where there located.
It sort of surprises me that Genuine Parts wants to sell - because I don't think the Motion Industries is doing all that great in the industrial world, or at least they have a lot more competition than they used to.
The building that AAP built in the town over has been recently sold (after it's been closed down for years now). The first thing I noticed recently was that they demolished the building. It wasn't that old either.
Last time I went to a Napa was 2 years ago for a starter. There isn’t a reason to go there, IMO unless it was close by.
With all the consolidation on the supply side(MotoRad, MAT Holdings, Driv, PGI, MPA), and the chains pushing their house brands which are reboxes(O’Reilly’s Murray/MasterPro/BrakeBest/SuperStart/Import Select and licensing the Precision brand from Driv as well as AZ’s Duralast/ValuePro lines), the independent parts store has to be different. There was a merger between Auto Value(Aftermarket Parts Alliance) and Federated Auto Parts, the last two auto parts co-ops for the indie parts house. A big distributor here in the Bay Area(City Auto Supply, they once had San Francisco, Marin and Oakland/San Leandro covered) was acquired by a bigger firm called NexaMotion.
With all the consolidation on the supply side(MotoRad, MAT Holdings, Driv, PGI, MPA), and the chains pushing their house brands which are reboxes(O’Reilly’s Murray/MasterPro/BrakeBest/SuperStart/Import Select and licensing the Precision brand from Driv as well as AZ’s Duralast/ValuePro lines), the independent parts store has to be different. There was a merger between Auto Value(Aftermarket Parts Alliance) and Federated Auto Parts, the last two auto parts co-ops for the indie parts house. A big distributor here in the Bay Area(City Auto Supply, they once had San Francisco, Marin and Oakland/San Leandro covered) was acquired by a bigger firm called NexaMotion.
dnewton3
Staff member
What I've always appreciated about most Napa stores is that they will do stuff which other chains won't do, such as ...
- turn rotors/drums
- make hydraulic hoses
- etc
I realize those may not matter to many folks these days, but in rural communities, it's a big help to get that kind of service at a local shop. I've not known any OR's to do things like carry hydraulic fittings and hose reels to custom make lines in a few minutes.
Further, Napa asks "what do you need?" (most of the time), not "what year is your car? ..." (because most chain stores are simply driven by application and not specific part). If you want a bearing for a trailer or a tractor, good luck trying to get the moron behind the OR counter to know how to measure an OD and ID, walk in back, and come out with a bearing. If it doesn't have a recognized application (vehicle make, model, year) they often have a very hard time finding something.
- turn rotors/drums
- make hydraulic hoses
- etc
I realize those may not matter to many folks these days, but in rural communities, it's a big help to get that kind of service at a local shop. I've not known any OR's to do things like carry hydraulic fittings and hose reels to custom make lines in a few minutes.
Further, Napa asks "what do you need?" (most of the time), not "what year is your car? ..." (because most chain stores are simply driven by application and not specific part). If you want a bearing for a trailer or a tractor, good luck trying to get the moron behind the OR counter to know how to measure an OD and ID, walk in back, and come out with a bearing. If it doesn't have a recognized application (vehicle make, model, year) they often have a very hard time finding something.
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^^Yup. "my" NAPA offers press service. I've seen store displays for hydraulic hoses in rural locations.
Certainly depends on the location.
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