CarParts.com Stock

CarParts.com, Inc. operates as a leading online provider of aftermarket auto parts and accessories.

The company principally sells its products, identified as stock keeping units (SKUs), to individual consumers through its flagship website at www.carparts.com and online marketplaces. The company’s user-friendly website, and mobile-friendly platform, provide customers with a comprehensive selection of over 913,000 SKUs with detailed product descriptions, attributes and photographs. The company has developed a proprietary product database that maps its SKUs to product applications based on vehicle makes, models and years to help ensure the right part for each specific vehicle is provided. The company’s online sales channel and relationships with suppliers enable it to eliminate intermediaries in the traditional auto parts supply chain and to offer a broader selection of SKUs than can be offered by offline retailer competition.

In January 2021, the company launched the first electric vehicle (EV) and hybrid focused online shopping hub at www.carparts.com/ev.

Outstanding Customer Service means delivering an extensive assortment of competitively priced, quality parts to drivers looking for simple, stress-free vehicle care in an unparalleled digital-first experience. The company accomplishes this by leveraging its vertically integrated supply chain, expanding its domestic footprint to get closer to the customer, and improving its website and user experience.

Products

The company offers a broad selection of aftermarket auto parts. The company continually refines its product offering by introducing new brands and parts categories, while discontinuing low-selling brands and SKUs. The company broadly classifies its products into three subcategories by function: replacement parts serving the wear and tear and body repair market, hard parts to serve the maintenance and repair market, and performance parts and accessories.

Replacement Parts: The replacement parts category is primarily consists of parts for the exterior of an automobile. The company’s parts in this category are typically replacement parts for original body parts that have been damaged as a result of a collision or through general wear and tear. In addition, the company sells an extensive line of mirror products, including one of its own house brands called Kool-Vue, which are marketed and sold as aftermarket replacement parts and as upgrades to existing parts.

Hard Parts: The hard parts category consists of engine and chassis components, as well as other mechanical and electrical parts, including one of its own house brands of aftermarket catalytic converters called Evan Fischer. These parts serve as replacement parts for existing engine parts and are generally used by professionals and do-it-yourselfers for engine and mechanical maintenance and repair.

Performance Parts and Accessories: The company offers performance versions of many parts sold in each of the above categories, including parts from one of its own house brands, JC Whitney. Performance parts and accessories generally consist of parts that enhance the performance of the automobile, upgrade existing functionality of a specific part or improve the physical appearance or comfort of the automobile.

Sales Channels

The company’s sales channels include the online channel and the offline channel.

Online Sales Channel: The company’s online sales channel primarily consists of its flagship e-commerce website www.carparts.com. The company also sells its products through online marketplaces, including third-party auction sites and shopping portals, which provide it with access to additional consumer segments. The majority of the company’s online sales are to individual consumers.

Offline Sales Channel: The company markets its products nationwide to auto parts wholesale distributors.

Fulfillment Operations

The company fulfills customer orders using two primary methods: stock-and-ship, where it takes physical delivery of merchandise and store it in one of its distribution centers until it is shipped to a customer; and drop-ship, where merchandise is shipped directly to customers from its suppliers.

Stock-and-Ship Fulfillment: The company’s stock-and-ship products are sourced primarily from manufacturers and other suppliers located in Asia, Europe, Mexico, the United States, as well as various other countries, and are stored in one of its distribution centers located in Virginia, Illinois, Nevada, Texas or Florida. The company also uses temporary outside storage and third-party logistics partners from time to time. All products received into the company’s distribution centers are entered into its inventory management systems, allowing it to closely monitor inventory availability.

Drop-Ship Fulfillment: The company has developed relationships with several United States-based auto parts distributors that operate their own distribution centers and can deliver products directly to its customers. The company internally developed a proprietary distributor selection system, Auto-Vend, which allows it to electronically select multiple vendors for a given order. Auto-Vend will attempt to first direct an order to one of the company’s warehouses. If the product is not in stock, Auto-Vend will process the order to the next appropriate vendor based on customer location, cost, contractual agreements, and service level history.

Suppliers

House Brands Product: The company has over 70,000 house brands SKUs in its product selection.

Branded Product: The company has over 843,000 branded SKUs in its product selection.

Marketing

The company’s online marketing efforts are primarily designed to attract visitors to www.carparts.com, convert visitors into purchasing customers and encourage repeat purchases among its existing customer base. The company uses a variety of marketing methods, including online marketing methods to attract visitors, which include paid search advertising, search engine optimization, affiliate programs, e-mail marketing and inclusion in online shopping engines. The company seeks to create cross-selling opportunities by displaying complementary and related products available for sale throughout the purchasing process, including bundled kits and sets. The company utilizes several marketing techniques, including targeted e-mails about specific vehicle promotions, to increase customer awareness of its products.

International Operations

In April 2007, the company established offshore operations in the Philippines. The company’s offshore operations allow it to access a workforce with the necessary technical skills at a significantly lower cost than comparably experienced the U.S.-based professionals. The company’s offshore operations are responsible for a majority of its website development, catalog management, and back office support. The company’s offshore operations also house its main call center. The company also primarily sources its house brands product from suppliers in the Asia-Pacific region.

Competition

The company competes with both online and offline retailers who offer original equipment manufacturer (OEM), aftermarket and private label parts to either the Do-It-Yourself (DIY) or Do-It-For-Me (DIFM) customer segments. Current or potential competitors include the following:

national auto parts retailers, such as Advance Auto Parts, AutoZone, Napa Auto Parts, CarQuest, O’Reilly Automotive and Pep Boys;

large online marketplaces, such as Amazon.com (Amazon) and sellers on eBay; and

wholesale aftermarket auto parts distributors, such as LKQ Corporation.

Intellectual Property

The company’s intellectual property, including trademarks, service marks, domain names, patents, copyrights and trade secrets, is an important part of its business. The company has current and pending trademarks registered in the United States, including Carparts.com, Kool-Vue, JC Whitney, Evan Fischer, SureStop, TrueDrive, DriveWire, and DriveMotive, amongst others, and it has additional trademark applications pending in the United States and other jurisdictions.

Seasonality

The company’s business is somewhat seasonal in nature.

History

The company was founded in 1995. It was incorporated in California in 1995 and reincorporated in Delaware in 2006. The company formerly known as U.S. Auto Parts Network, Inc. and changed its name to CarParts.com, Inc. in 2020.