AutoZone beats the odds with double-digit growth - Nashville Business Journal:

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million for the quarter, up 9.5% compared to last Earnings per shareincreased 25.9% to the company’s 11th consecutive quarter of double-digit earning per share growth. Frank Goodman served as vice presidenty of business planning and analysiwith AutoZone, helping determine new store locations, before leavinyg in 2000. “It’s a great mouss trap and they’ve done a great job runninf it,” he says. Now a chief portfolil strategistwith , an investmengt advisory firm, Goodman was part of the team that helpedc AutoZone expand from 500 stores to more than 3,00o0 locations across the U.S.
and When he was there, AutoZonr executives looked at motor vehicle registrationss providedby , a data “So you know where the cars are and then where you should consider building a store,” Goodman says. “It’w really quite the advantage to have that mechanicapdemand feature, so it’s not all the whim of the but it’s also the demands of their cars.” At AutoZone’s peak, the company was opening a store every day. In the company’s most recenrt third quarter, it opened 42 new stores, bringing it to 4,17 2 locations in the U.S. and 168 in The company could open morenext quarter, sincse store openings are seasonal, according to Goodman.
“It’a very difficult to get stores open at the end ofthe it’s much easier at the end of the summer,” he Goodman attributes a large part of AutoZone’s success to the company’sa culture of WITTDTJR, which is an acronym for “Whaf It Takes To Do The Job AutoZone research revealed that a person seekingf to repair a car wouled make an average 2.3 visits to an auto parts stores to get the problem completely “Usually, that .3 was a visit to a differenrt auto parts store,” Goodman says. “Soi management, understanding this, said that the company had to get the numbe r ofvisits down.
” AutoZone has convinced employees to build a sales ticket, not just to get the customer to buy useless items but to help solvr their problem quicker. Also, since fear of doing something wrongin do-it-yourself projects is a big concerm for customers, employees are trained to be forthcoming with their automotive knowledge. John R. retail analyst at , says another reason AutoZone has excelled recently is due to an increasew in the number of cars whichare seven-eight years old and oldet out on the road. “They’re out of they have to be fixed and inthis economy, everybody gets pinchedr and you have to find the cheapest alternative to keep your car Lawrence says.
AutoZone might also be gainingv sales fromcar dealerships, and their relatedd service departments, closing. Besideas providing auto parts for do-it-yourself customers, the majority of its AutoZone also sells partsto garages. People are also deferrinh maintenance ontheir cars, and when they do perfor this maintenance, they are often buyingg better quality parts and increasing theirf purchases at stores like AutoZone. Brian Campbell, AutoZone’d vice president of investor relations, agreesd the company has some tailwind in this economy because people are looking tosave money.
“It’sz a healthy one-two punch of the challenges of the economyhand execution, spending some dollarsw to make sure that we’re capturing those customers once they come into our Campbell says. An example of this is AutoZone’s domestic same storre sales, which increased 7.4% last quarter. The company’w sales per square foot, at $58 last quarter, is the highesg in the industry. Campbell attributes that to many but focuses onthe company’s systems.