Advance Auto Parts 2008 Annual Report Download - page 22

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8
workforce consisted of 89% of our Team Members employed in store-level operations, 8% employed in distribution
and 3% employed in our corporate offices. We have never experienced any labor disruption and are not party to any
collective bargaining agreements. We believe that our Team Member relations are good.
Intellectual Property
We own a number of trade names and own and have federally registered several service marks and trademarks,
including “Advance Auto Parts,” “Western Auto,” “Parts America,” “Autopart International” and “PDQ” for use in
connection with the automotive parts retailing business. In addition, we own and have registered a number of
trademarks for our proprietary products. We believe that these trade names, service marks and trademarks are
important to our merchandising strategy. We do not know of any infringing uses that would materially affect the use
of these trade names and marks, and we actively defend and enforce them.
Competition
We operate in both the DIY and Commercial markets of the automotive aftermarket industry. Our primary
competitors are (i) both national and regional retail chains of automotive parts stores, including AutoZone, Inc.,
O'Reilly Automotive, Inc. and The Pep Boys–Manny, Moe & Jack, (ii) discount stores and mass merchandisers that
carry automotive products, (iii) wholesalers or jobber stores, including those associated with national parts
distributors or associations, such as NAPA and Carquest, (iv) independent operators and (v) automobile dealers that
supply parts. We believe that chains of automotive parts stores that, like us, have multiple locations in one or more
markets, have competitive advantages in customer service, marketing, inventory selection, purchasing and
distribution as compared to independent retailers and jobbers that are not part of a chain or associated with other
retailers or jobbers. The principal methods of competition in our business include store location, product offerings,
availability, quality, price and customer service.
Environmental Matters
We are subject to various federal, state and local laws and governmental regulations relating to the operation of
our business, including those governing recycling of automotive lead-acid batteries and used automotive oil, and
ownership and operation of real property. We sell consumer products containing hazardous materials as part of our
business. In addition, our customers may bring automotive lead-acid batteries or used automotive oil onto our
properties. We currently provide collection and recycling programs for used lead-acid batteries and used oil at all of
our stores as a service to our customers. Pursuant to agreements with third party vendors, lead-acid batteries and
used oil are collected by our Team Members, deposited onto pallets or into vendor supplied containers and stored by
us until collected by the third party vendors for recycling or proper disposal. The terms of our contracts with third
party vendors provide that they are in compliance with all applicable laws and regulations. Persons who arrange for
the removal, disposal, treatment or other handling of hazardous or toxic substances may be liable for the costs of
removal or remediation at any affected disposal, treatment or other site affected by such substances. Based on our
experience, we do not believe that there are any material environmental costs associated with the current business
practice of accepting lead-acid batteries and used oil as these costs are borne by the respective third parties.
We own and lease real property. Under various environmental laws and regulations, a current or previous owner
or operator of real property may be liable for the cost of removal or remediation of hazardous or toxic substances on,
under or in such property. These laws often impose joint and several liability and may be imposed without regard to
whether the owner or operator knew of, or was responsible for, the release of such hazardous or toxic substances.
Other environmental laws and common law principles also could be used to impose liability for releases of
hazardous materials into the environment or work place, and third parties may seek recovery from owners or
operators of real properties for personal injury or property damage associated with exposure to released hazardous
substances. From time to time, we receive notices from the Environmental Protection Agency and state
environmental authorities indicating that there may be contamination on properties we own, lease or operate or may
have owned, leased or operated in the past or on adjacent properties for which we may be responsible. Compliance
with these laws and regulations has not had a material impact on our operations to date.