AutoZone beats the odds with double-digit growth - bizjournals:

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million for the quarter, up 9.5% compared to last year. Earnings per shar increased 25.9% to $3.13, the company’s 11th consecutive quarte of double-digit earnings per share growth. Frank Goodmanb served as vice president of business planning and analysis with helping determine newstore locations, before leavin g in 2000. “It’s a great mouse trap and they’ve done a greatt job running it,” he says. Now a chiec portfolio strategistwith , an investment advisor firm, Goodman was part of the team that helped AutoZonw expand from 500 stores to more than 3,00o locations across the U.S.
and When he was AutoZone executives looked at motoer vehicle registrations providedby , a data “So you know where the cars are and then wher you should consider building a Goodman says. “It’s really quitw the advantage to have that mechanicaldemandd feature, so it’s not all the whim of the population, but it’sw also the demands of theidr cars.” At AutoZone’s peak, the company was openingh a store every day. In the company’s most recent third it opened 42new stores, bringinyg it to 4,172 locationsd in the U.S. and 168 in Mexico. The compant could open more next quarter, sincd store openings are seasonal, according to Goodman.
“It’x very difficult to get storesx open at the end ofthe winter, it’s much easiet at the end of the he says. Goodman attributes a large partof AutoZone’ success to the company’s culture of WITTDTJR, which is an acronym for “What It Takes To Do The Job Right.” AutoZon research revealed that a person seeking to repair a car wouldr make an average 2.3 visitw to an auto parts store to get the problem completelyy solved. “Usually, that .3 was a visit to a differenty autoparts store,” Goodman says. “So management, understandinbg this, said that the company had to get the numbet ofvisits down.
” AutoZone has convinced employees to build a sales ticket, not just to get the customedr to buy useless itemsa but to help solve their problem Also, since fear of doing something wrong in do-it-yourselfv projects is a big concern for customers, employees are trained to be forthcominfg with their automotive knowledge. John R. retail analyst at , says another reasoj AutoZone has excelled recently is due to an increase in the number of cars whichhare seven-eight years old and older out on the “They’re out of warranty, they have to be fixee and in this everybody gets pinched and you have to find the cheapes t alternative to keep your car Lawrence says.
AutoZone might also be gaining sales from car and their relatedservice departments, closing. Besides providing auto parts for do-it-yourself customers, the majorit y of its business, AutoZone also sells parts to People are also deferring maintenance on their and when they do perform this they are often buying better qualityu parts and increasing their purchaseas at storeslike AutoZone. Brian AutoZone’s vice president of investor agrees the company has some tailwinde in this economy because peopl e are looking tosave money.
“It’ws a healthy one-two punch of the challengexs of the economy and spending some dollars to make surethat we’re capturing those customers once they come into our stores,” Campbell An example of this is AutoZone’s domestif same store sales, which increased 7.4% last The company’s sales per square at $58 last quarter, is the highesg in the industry. Campbell attributes that to many but focuses onthe company’s systems.