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Ten Percent Makes a Difference

Sep 28, 2017
Nathan Shipley, Executive Director, Industry Analyst ;

It has been almost a full year since the launch of NPD’s Retail Tracking Service – Expanded Channels for the U.S. automotive aftermarket. This has enabled NPD to report on point-of-sale data from channels that do not represent the major players of the aftermarket, but are still important to suppliers and consumers alike. This includes convenience, drug, grocery, and mid-tier/value stores (including dollar stores), representing over 50 retailers in the U.S.

When we look at how this aggregate of channels performed during the first half of 2017, we see a picture that is also consistent across each channel. In aggregate, sales declined 4 percent during the first half of the year, with all four channels posting a similar result. Motor oil had much to do with this trend. As the largest category tracked, motor oil’s sales performance was indicative of how the overall market performed. The convenience store channel is most important to the motor oil category, representing over $75 million in motor oil sales for the first half of the year. Dollar volume in the category dropped by almost 13 percent, due in part to a retail selling price increase of over 12 percent. This price increase in the convenience channel for motor oil follows a trend that most categories in the channel have experienced, as the channel overall posted a selling price increase of almost 8 percent.

Midway through the year, 13 of the 16 tracked categories experienced declines in dollar volume, which followed the same trend noted above with motor oil. With consumer confidence trending positive in 2017, and gasoline prices staying at relatively low levels, it is feasible that consumers have slightly shifted away from these channels as it relates to the automotive aftermarket. Separately, we know that e-commerce is also slowly taking share away from brick-and-mortar stores in this space. With that said, we estimate that this group of channels represents 10 percent of the total retail marketplace. In our current aftermarket retail environment, that 10 percent is very important to the overall picture.

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