Pep Boys 2009 Annual Report Download - page 59

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PART I
ITEM 1 BUSINESS
GENERAL
The Pep Boys—Manny, Moe & Jack and subsidiaries (‘‘the Company’’) began operations in 1921
and is the only national chain offering automotive service, tires, parts and accessories. This positioning
allows us to streamline the distribution channel and pass the savings on to our customer facilitating our
vision of becoming the automotive solutions provider of choice for the value-oriented customer. Our
primary operating unit is our Supercenter format, which serves both ‘‘do-it-for-me’’ (‘‘DIFM’’, which
includes service labor, installed merchandise and tires) and ‘‘do-it-yourself’’ (‘‘DIY’’, or retail)
customers with the highest quality service offerings and merchandise. In most of our Supercenters, we
also have a commercial sales program that provides commercial credit and prompt delivery of tires,
parts and other products to local, regional and national repair shops and dealers.
The Company operates approximately 11,686,000 of gross square feet of retail space, including
service bays. The Supercenters average approximately 20,700 square feet, Service & Tire Centers
average 6,800 square feet and the Pep Express stores average 9,500 square feet.
In 2009, as part of our long-term strategy to lead with automotive service, we began
complementing our existing Supercenter store base with Service & Tire Centers. These Service & Tire
Centers are designed to capture market share and leverage our existing Supercenters and support
infrastructure. We currently plan to lease Service & Tire Center locations, as we believe that there are
sufficient existing available locations with attractive lease terms to enable our expansion. We are
targeting a total of 40 new Service & Tire Centers in fiscal 2010, and 80 in fiscal 2011. In fiscal 2009,
we opened 24 new Service & Tire Centers including ten locations acquired through our purchase of
Florida Tire, Inc. and one new Supercenter.
The following table sets forth the percentage of total revenues from continuing operations
contributed by each class of similar products or services for the Company and should be read in
conjunction with the Consolidated Financial Statements and Notes thereto included elsewhere herein:
Year ended
January 30, January 31, February 2,
2010 2009 2008
Parts and accessories ..................... 63.9% 65.1% 66.6%
Tires ................................ 16.4 16.3 15.2
Total merchandise sales ................... 80.3 81.4 81.8
Service labor ........................... 19.7 18.6 18.2
Total revenues .......................... 100.0% 100.0% 100.0%
As of January 30, 2010, the Company operated its stores in 35 states and Puerto Rico. The
following table indicates, by state, the number of stores the Company had in operation at the end of
1