Independent CARQUEST store owner optimistic on loosening grip of supply strains
Distribution management is consuming less of Billy Konaxis’ waking hours. But he has a way to go. Konaxis, an independent parts store owner of three locations in the metro Boston, Massachusetts, suburbs — and expecting to add ten more — flies the CARQUEST banner. His Billerica, Chelmsford and Lynn jobber stores are linked onto the sprawling Advance Auto Parts enterprise, providing inventory access to sister stores Worldpac, Autopart International, and the Advance outlets. Regardless of this impressive sourcing network to service the Bay State’s most populous vehicle count, the unpredictable pandemic, record-high inflation and the tight used car market have tested Konaxis’ expertise. Gradually, he believes that the parts marketplace is finding its pre-COVID days. Aftermarket Business World shares the conversation with Konaxis.
What is your take on the supply chain? Some experts say the aftermarket will see the product shortages and long lead times improving by 2023. Do you agree?
The supply chain has been the biggest obstacle during COVID, which every industry had to figure out. We see some areas of improvement, but for the most part, it is a daily struggle to find manufacturers that have SKU availability. In the pre-COVID days, we dealt with fewer vendors, as we bought by brand. Now we purchase by part number and find vendors able to meet our stocking needs. Over the past four to six weeks, we have seen shipping rates increase slightly, and we expect to continue to deal with more of the same throughout 2022.
What are the major themes in conversations with the professional installers and auto dealership service operations these days?
Our conversations mainly consist of finding replacement parts at a competitive price. We consistently promote our in-stocks, as we have done a great job by teaming up with multiple vendors by category to ensure we have what our customers need.
How has the demand for used cars impacted your business?
This trend is one of the major reasons we see 30% comps. As new vehicles are more difficult to locate, many more people are fixing up their older cars and trucks instead of paying more than the manufacturer’s sticker prices. We are seeing even more demand than ever for categories like brakes, chassis and batteries.
Explain your source of strength as an independent CARQUEST store owner by sourcing products from Advance Auto Parts. Does that relationship limit your inventory offerings?
Being independent gives me the freedom to buy from whomever I want. Our partnership with Advance Auto Parts and its network of retail locations gives us the ability to source out-of-stock products and to get parts in stock daily. When we run out of a high-selling SKU and the distribution center is waiting for delivery trucks to arrive, we can source from any Advance Auto Parts location and get those SKUs back in stock to fill any customer order. At the same time, as an independent, we can set up direct accounts outside of CARQUEST/Advance. If we can’t get the product from the DC, we can buy directly to ensure in-stocks.
Product buyers are demanding full transparency into every link of the supply chain. Given your company size and direct ties with Advance Auto Parts, how much control do you have?
Totally agree! Buyers have gone outside their normal routine over the past year. In our three stores, I have direct control over everything we order and when we order it. Never before have I spent as much or more time on buying. Before COVID, I would place an order to a sales representative or submit an order to our DC. Typically, fill rates were in the high 80s or low 90s. Now we run daily reports by the manufacturer. We source the same day to ensure product in-stocks. Before the supply chain issues, we had enough stock to last three to four days, because we anticipated that more stock would follow. Today, we keep enough stock for three to four weeks. Or, in some cases, on extremely popular stuff — like oil, diesel exhaust fluid, extremely popular filters, pads, or rotors— we keep enough stock to carry us up to four months.
Any areas of opportunity do you see for the year to come?
Align your company with multiple vendors by category to ensure that you better manage your inventory. Even though the supply chain issues might be improving, position your company toward a predictable supply network. Our job in the industry is to help our commercial customers turn their autos in the bays quicker. More than ever, invest the time to ensure you have in-stocks that installers require. We’re also looking at other opportunities like changing the delivery fleet over to hybrids as fuel prices continue to rise.
