Pep Boys 2009 Annual Report Download - page 61

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BUSINESS STRATEGY
Our vision for Pep Boys is to take what we believe to be our industry-leading position in
automotive services and accessories and become the automotive solutions provider of choice for the
value-oriented customer. Our brand positioning—‘‘Pep Boys Does Everything. For Less’’ is designed to
convey to customers the breadth of the automotive services and merchandise that we offer and our
value proposition. The four strategies to achieve our vision are to: (i) Earn the trust of our customers
every day, (ii) Lead with our service business and grow through our Service & Tire Centers,
(iii) Establish a differentiated retail experience by leveraging our Automotive Superstore and
(iv) Leverage our Automotive Superstore to provide the most complete offering for our commercial
customers.
Earn the TRUST of our Customers every day. We do this by delivering a customer experience
that is based on Speed, Expertise, Respect and Value. We start with our associates, focusing on their
hiring, training and development, and the conversion of their compensation to performance-based
plans. In our stores, we strive to continuously improve the customer experience by providing better
looking and easier to shop stores and more consistent execution of our simplified and streamlined
operations. We have developed a specific tailored marketing plan for each of our markets to maximize
our reach and efficiencies. These marketing programs focus on TV and radio promotions scheduled
around traditional shopping holidays that focus on the most frequently needed services. These
promotions are supplemented by extensive direct marketing and grass-roots campaigns and occasional
print campaigns. And our Rewards program that benefits customers whether they choose to do it
themselves or have us do it for them, helps to drive customer count increases and repeat business
through discounted towing, free services and rewards points for purchases.
Lead with our Service business and grow through our Service & Tire Centers. We do this by
being a full service—tire, maintenance and repair—shop that DOES EVERYTHING. FOR LESS. Our
full service capabilities, ASE-certified technicians and continuous investment in training and equipment
allow customers to rely on us for all of their automotive service and maintenance needs. We can
provide these services at highly-competitive prices because our size and business model allow us to buy
quality parts at lower prices and pass those savings onto our customers.
Our store growth plans are centered on a ‘‘hub and spoke’’ model, which calls for adding smaller
neighborhood Service & Tire Centers to our existing Supercenter store base in order to further
leverage our existing inventories, distribution network, operations infrastructure and advertising spend.
We opened 25 new stores in 2009—24 Service & Tire Centers and one smaller prototype Supercenter.
Our plans call for 40 more new locations in 2010, followed by 80 in 2011. The typical Service & Tire
Center is full service with approximately six service bays and $1 million in expected sales. Our
Supercenters were built to be destination stores. Our Service & Tire Centers offer customer
convenience, allowing us to be close to our customers’ home or work.
Establish a differentiated Retail experience by leveraging our Automotive Superstore. The size of
our stores allows us to provide the highest level of replacement parts coverage and the broadest range
of maintenance, performance and appearance products and accessories in the industry. As part of our
commitment to carry the best assortment of automotive aftermarket merchandise, we make assortment
decisions by examining every merchandise category using market and demographic data to assure we
have the best product in the right place. This category management process ensures our assortment
includes the appropriate coverage for service, retail and commercial consumers as well as allowing us to
make good, sound decisions about price, product and promotions.
Leverage our Automotive Superstore to provide the most complete offering for our Commercial
customers. To further leverage our inventory and automotive aftermarket expertise, we continue to
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