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SOURCE: IBISWorld Inc.
Over the next five years, disposable income and employment will continue to rise, resulting in weaker demand from consumers, but stronger demand from commercial clients. For these reasons, industry research firm IBISWorld has added a report on the Auto Parts Stores industry to its growing industry report collection.
Los Angeles, CA (PRWEB) March 06, 2013
The Auto Parts Stores industry is a mature one, providing widely accepted automotive parts and accessories to consumers, manufacturers and automotive service stations. Revenue growth is determined by demand from households and commercial clients, including passenger vehicle, truck and heavy vehicle manufacturers, and auto repair shops. Over the five years to 2013, industry revenue has grown at an estimated annualized rate of 1.1% to $2.9 billion, including growth of 2.5% in 2013. The recession has both benefited and hindered the industry. A decline in disposable income and employment levels during 2008 and 2009 resulted in a greater number of consumers transforming into do-it-yourself customers, opting to perform their own vehicle maintenance and repair work to cut costs. As a result, they visited auto parts stores in higher numbers. At the same time, the poor economic climate limited demand from commercial clients, such as automotive manufacturers, which rely on strong economic conditions to increase production. In other words, the same conditions (i.e. low disposable income and employment rates) that spurred consumer demand for industry products reduced demand from commercial clients. As the economy continues to improve, the reverse is expected, with demand from commercial clients increasing, while demand from consumers declining, says IBISWorld industry analyst Radia Amari.
Internal competition exists among companies on the basis of price, product availability and customer service. Over the past five years, a higher number of smaller companies have exited the industry, unable to sustain themselves in light of fluctuating demand. As a result, larger companies benefiting from economies of scale have been able to expand, continues Amari. The Auto Parts Stores industry has a low level of market share concentration. However, consolidation will increase as larger companies attempt to increase their market share. Over the past five years, the number of retailers has declined at an estimated average annual rate of 2.0% to about 3,326 companies. The industry includes a high number of nonemployers. According to data sourced from Statistics Canada, about 41.7% of companies employ fewer than five people.
Revenue is projected to remain stable over the next five years. Disposable income and employment levels will continue to rise, resulting in weaker demand from consumers, but stronger demand from commercial clients. However, competition will remain a key feature of the industry and continue to push out companies. For more information, visit IBISWorld’s Auto Parts Stores in Canada industry report page.
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IBISWorld industry Report Key Topics
This industry sells automotive parts and accessories, with the exception of tires. Tire retailers are included in the Tire Dealers industry (IBISWorld report 44132CA).
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US and Canadian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.ca or call 1-800-330-3772.
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