Baxter Auto Parts expands into Seattle market, acquires Action Auto Parts
Tacoma, Wash.—Baxter Auto Parts, based in Portland, Ore., expanded its footprint in the Northwest by acquiring an independent retail auto parts chain in the Seattle area. The purchase of Action Auto Parts adds four stores to Baxter’s Auto Parts portfolio, bringing the total to 37 locations in Oregon, Washington and Northern California, said Dean Skaggs, regional manager of Baxter and Performance Warehouse.
Baxter Auto Parts was looking for an opportunity to expand into an area between north Seattle and Everett that had a strong population base, Skaggs said.
“We noticed that every location we identified already had an Action Auto Parts in the vicinity,” he said, noting that all of the Action stores were located on Highway 99 between Seattle and Everett. “We’ve had a long relationship with Joe McIntosh, who’s owned Action Auto Parts for more than 50 years.”
Skaggs said the expansion Baxter was looking for coincided with McIntosh’s decision to sell Action Auto Parts and retire from the parts business (he retained the longtime Action Machine shop operation).
“The time was finally right,” Skaggs said. “We acquired all four of the Action Auto Parts stores and their personnel.”
He said the next step was a discussion whether to change the name of the well-established Action Auto Parts stores.
“There’s never a good time to change a name,” Skaggs said. “We considered all options: leaving the name alone, merging the two names or just rebranding from day one.”
In the end, Skaggs said they decided they wanted the names of all their stores to be Baxter Auto Parts, so the change was immediate, even if the signage hasn’t quite caught up yet. Baxter Auto Parts now has 10 store locations in Western Washington.
Skaggs said Baxter increased the inventory at the four new stores by two to two-and-a-half times from what it had before.
“The DIFM and installer market is one of the places we see growth potential,” he said. “So what we’re trying to do is make sure our brake inventories are solid, along with our undercar products, chassis, and drive axels.”
Baxter also recently overhauled inventory on its automotive belts, hose and timing components.
“I really believe those are the kind of things our installers and retail customers will notice,” he said. “It’s meant to be a ‘I have it’ inventory.”
Skaggs said most Baxter Auto Parts stores run about 50/50 retail to wholesale, with smaller stores running a little heavier wholesale, and larger stores doing a little more retail.
“What differentiates the Baxter stores from our competition are our products,” he said. “Performance Warehouse carries over 600 lines, and because of the locations of the distribution centers, our products are always available same day or overnight.”
The relationship between Performance Warehouse (PW), owned by Baxter Auto Parts, is occasionally a challenge with the independent jobber customers of PW, Skaggs said.
“I’ve been asked more than once if Performance Warehouse is our supplier or our competition.”
Skaggs said some of his competition used that argument as a sales tool when selling against Performance Warehouse, but Performance Warehouse was able to turn that argument on its head by showing the benefits of the relationship between Performance and Baxter, and how that would benefit the independent jobber customers of PW.
“Every marketing program we’ve ever taken to our independent customer base, we’ve test flown in our stores,” he said. “We make sure our advertising works and then we take it out to our customers.”
Skaggs said when Baxter is in a market with an independent customer, they are a good and fair competitor.
Our pricing is competitive in our markets,” Skaggs said. “And Performance Warehouse is a darn good supplier. The fact that we have stores in a market doesn’t change the market. There’s a ton of competitors out there.”
Baxter’s ability to react to issues that come up also sets them apart, he said. “We can be a little more nimble because if I see something that needs to be addressed, I can address it today.”
If the problem is systematic, Skaggs said he can at least start working on it immediately.
“The company empowers us to think and make decisions,” he said. “We don’t have to go through multiple levels of management in all areas of the country. We’re all right here.”
Skaggs said the “right here” factor is a huge benefit to the business, and something he constantly trumpets.
Skaggs said the growth of the company may not be over, and while nothing is imminent, they are always keeping their eyes open for new opportunities.
“This is a family owned business, with regional Northwest headquarters in Portland,” he said. “We have three second-generation owners still active in the day-to-day operations. We have seven third-generation members who are running the business. We’re not just another corporately owned chain of stores. That makes us different. Our connection is to this region, and that’s where we live and where we operate from.”
Skaggs said he talks to someone in the family every day. He’s been doing that since 1994, and has just celebrated his 18th anniversary with the company, he said.