O'Reilly Auto Parts 2002 Annual Report Download - page 10

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8O’Reilly Automotive
STRATEGIC DISTRIBUTION SYSTEMS
Guaranteeing our customer the right part for the right price at the right time is
more than just our slogan, it’s our promise. Every member of Team O’Reilly strives
to ensure that every customer who enters an O’Reilly store receives the best
customer service available anywhere. Each of our stores carries an average of
22,000 stock keeping units (SKUs), more than our competitors. Our enhanced
inventory management system links every store to our nine distribution centers.
Transactions are recorded within each store and as inventory is sold, the inventory
management system places an order at the distribution center for the product to
be replenished that night. Our global inventory system allows our stores to view
and order from the inventory of other stores and distribution centers, which
reduces our overall inventory. Our advanced supply chain system has allowed us to
customize the merchandise we stock at each store. The “global” inventory system
has allowed us to bring $20 million of overstocked, store merchandise back to the
distribution centers since its implementation in June 2001, minimizing our inventory
investment and maximizing our return on assets.
Our distribution centers are strategically located in Little Rock, Arkansas;
Des Moines, Iowa; Kansas City and Springfield, Missouri; Oklahoma City,
Oklahoma; Knoxville and Nashville, Tennessee; and Houston and Dallas, Texas.
Combined, these nine distribution centers contain 1,945,690 square feet of
warehouse space and house over 100,000 unique SKUs. This unparalleled availability
of broad inventory and overnight delivery gives our customers quick access to those
hard to find parts.
DUAL MARKET STRATEGY
Keeping a successful balance between servicing do-it-yourself (DIY) and professional
installer customers is a difficult challenge, as many of our competitors have come
to realize. But that doesn’t stop us from continuing to focus on our goal of a 50/50
blend of professional installer and DIY customers to allow greater market penetration.
O’REILLY COMPETITIVE ADVANTAGES