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    • Advance Auto Parts announces plans to close hundreds of stores
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    Advance Auto Parts announces plans to close hundreds of stores

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    Advance Auto Parts announced Thursday that it will close at least 500 corporate stores by mid-2025 and exit another 200 independent locations.

    The move comes as the company said in a release that its gross profit rose 11% in the third quarter of 2024 to $907 million compared to the same period a year ago. The company also said its adjusted expenses were $891.2 million, or 41.5% of net sales, compared to 40.2% in the third quarter of 2023, mainly due to lower sales.

    “We are driving a clear path forward and introducing a new three-year financial plan focused on executing on retail fundamentals to improve the productivity of all our assets and create shareholder value,” Shane O’Kelly, chairman and chief executive. said the officer in report.

    The company also said it incurred high labor-related expenses due to salary investments in front-line team members, which were partially offset by a reduction in marketing expenses, the statement said.

    Advance Auto Parts serves both professional installers and do-it-yourself customers, according to its website. As of October 5, Advance operated 4,781 stores under the Advance Auto (4,492) and Carquest (289) brands, primarily in the United States, with additional locations in Canada, Puerto Rico and the US Virgin Islands. The largest market is Florida, where 522 stores operate.

    In 2024, through October 5, the company said it had opened 23 stores and closed 29.

    The company also served 1,125 independent Carquest-branded stores in those locations, in addition to Mexico and various Caribbean islands.

    Here’s what we know about the company’s plans.

    Which stores in Michigan will close?

    It’s unclear whether Michigan stores will be affected by the auto parts company as it reorganizes. The release did not specify which locations would close.

    The company operates 140 stores in Michigan, including four in Lansing and Warren; two in Battle Creek, Detroit, Livonia, Holland and Sturgis; and one each in Howell, Canton, Cheboygan, Novi, Port Huron, South Lyon, Troy and Westland.

    In addition to the 523 corporate stores, they will also exit 204 independently owned locations and close four distribution centers by mid-2025.

    Why do I close locations?

    According to the report, sales in the third quarter of 2024 totaled $2.1 billion, compared to $2.2 billion in the previous year’s third quarter.

    Store operations, merchandise excellence and supply chain will take hits as the company tries to recover what it has lost.

    The report says the closures should help improve parts supply, increase parts availability and adjust pricing and promotions to improve gross margin.

    The company said it plans to consolidate distribution centers into 13 large facilities by 2026, open 60 market hub locations by mid-2027, and optimize shipping routes and freight to reduce costs and improve productivity .

    In addition, the company plans to standardize its store operation model and improve labor productivity and accelerate the pace of new store openings, although it did not say where it will open new stores.

    Jalen Williams is a trends reporter at the Detroit Free Press. Contact him at [email protected]

    Trade call reporter Jordan Green contributed reporting.

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