Advance Auto Parts Aims to Boost Productivity by Closing Stores

Core Insights - Advance Auto Parts plans to close 523 corporate stores, exit 204 independently owned locations, and close four distribution centers in the U.S. by mid-2025 to enhance operational productivity [1] - The company reported a decline in net sales from $2.2 billion to $2.1 billion, with comparable sales decreasing by 2.3%, while gross profit increased by 11% [3] Strategic Actions - The company has completed the sale of its wholesale operation, Worldpac, which will help simplify its business model and focus on core retail improvements [2][6] - A new three-year financial plan has been introduced, aiming to improve adjusted operating income margin by over 500 basis points by optimizing store operations, merchandising, and supply chain [4] Operational Improvements - Plans include standardizing the store operating model, improving labor productivity, and accelerating new store openings [4] - In merchandising, the company aims to enhance first costs, speed up market entry for parts, improve availability, and manage pricing and promotions to boost gross margin [5] Supply Chain Optimization - The company intends to consolidate distribution centers, open more market hub locations, and optimize transportation routes and freight [5] - The strategic plan focuses on strengthening the blended-box business to elevate core operations and achieve consistent profitable results [7]