Pep Boys 2008 Annual Report Download - page 3

THE PEP BOYS −
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− MANNY, MOE & JACK
3111 West Allegheny Avenue
Philadelphia, Pennsylvania 19132
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LETTER TO OUR SHAREHOLDERS
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As you know, 2008 was a rebuilding year for Pep Boys. It was the first year executing our strategic plan, which
was announced in the Fall of 2007. This plan focuses on:
• Leading with our service business and growth through adding service spokes.
• Creating a differentiated retail experience by creating the Automotive Superstore.
• Leveraging our superstores and service centers to provide the most complete offering for our commercial
customers.
We are executing this plan to transform Pep Boys into the Automotive Solutions Provider of Choice for the
Value-Oriented Customer. With our strategic plan as our guide, in 2008 we began to address our priorities relative
to our people, our products and services, our marketing and our service center density.
BEST PEOPLE
We have restructured our store leadership organization to ensure that all three lines of business - service, retail
and commercial - work together for the benefit of our customers. We feel good about the level of pride we see
returning to our stores and, more importantly, our associates feel that we are making the right moves to restore the
Pep Boys brand. Our company-wide commitment for 2009 is to get Pep Boys “Back in Black.” Black in sales
trends and black in profitability.
One of the most important commitments we have made to our people has been training - technical, customer
service and sales. Training is important for both our associates and our customers. It improves associate capability,
pride and confidence. It also improves the quality of the work we do. And it improves the perception of the quality
of work that we do, because our associates are able to serve our customers with skill and confidence.
BEST PRODUCTS AND SERVICES
With respect to our products, we are focused on core automotive. It took much of 2008 to complete the re-
merchandising of each of our stores that we started in 2007. Our parts merchandising is now vastly improved in
terms of coverage and pricing. Our sales floor merchandising now makes it much easier for our customers to shop
us and to find what they want. Our focus on core automotive is also helping our commercial business. Accessories
and complementary products are still an important part of our mix. In fact, accessories are a differentiating element
of our Automotive Superstore. We have retained complementary products that customers have come to know us for
- like powersports and generators. And we will add new categories from time to time, but this is not going to
distract us from our core automotive focus.
As I have stated before, service is our leading business. We have broken down the walls within our organization
that previously existed between retail, commercial and service. The mantra in our stores is to get “one more service
sale per store per day.” It’s about always saying “yes” to our customers and growing our business through
execution in providing fast, expert service to each customer every time. It’s about our category managers reviewing
all three lines of business when it comes to customer insights, assortments, pricing and selling process. This has led
to the introduction of hybrid vehicle services and 29 minute oil changes, as well as investments in state-of-the-art
diagnostic equipment.