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Amazon triggers Advance Auto Parts call for outside help

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Advance Auto Parts CEO Tom Greco on Tuesday said the company plans to bring in outside help to compete against e-commerce giant Amazon.

“So when you talk about Amazon particularly, we’ve had to recruit some people into the company who can really help us compete vigorously against formidable competitors like Amazon,” he told FOX Business’ Liz Claman on “Countdown to the Closing Bell.”

The company is trying to engineer a business turnaround by using its savings from the tax reform bill and is taking steps to step up its e-commerce program.

“We’re investing in e-commerce and our technology programs because we know that’s going to be important,” Greco said. “We certainly made big investments in customer service because the experience that our customers have both online and in the stores is critical and then in our people.”

According to Greco, one of the biggest focuses of the plan is to incentivize its employees.

“Overall, we have a plan that is going to invest significantly back in our employees,” he said. “We have front-line employees all over the country who are really important for us. We want the very best parts people in the business working for Advance.”

After President Donald Trump signed the Tax Cuts and Jobs Act, which slashed the corporate tax rate to 21% from 35%, companies began giving incentives to their workers including salary hikes to $1,000 bonuses.

As a part of the auto parts retailer’s turnaround strategy, the company introduced a stock ownership program that provides its top-performing employees with stock options.

“We actually introduced a stock ownership program for them for our top performers so that they can earn stock in the company,” he said. “We feel that is a really good retention move for us, and it has dropped our turnover significantly.”

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      link hidden, please login to view  has crushed many iconic American companies, but auto parts retailers like link hidden, please login to view  and link hidden, please login to view  have managed to fend them off. For now.
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      link hidden, please login to view  have also jumped into the fray, in part, to compete against Amazon. So far, auto parts retailers have been spared from sharing the same fate as 
      link hidden, please login to view, Toys R Us and so many other companies rendered redundant by Amazon. For years, the $130 billion business selling aftermarket auto parts was one of the steadiest segments in retail, with mild cyclical fluctuations and slow trend of consolidation, MoffettNathanson analyst Greg Melich told CNBC. The segment even managed to make it through the recession reasonably well, as drivers repaired instead of upgrading their cars.
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      About 80 percent of 
      link hidden, please login to view  business comes from people repairing their own cars with the other 20 percent coming from professional mechanics. About 60 percent of link hidden, please login to view  sales comes from the do-it-yourself consumer market with mechanics making up the rest. The split is reversed at Advance Auto Parts with 40 percent of its revenue coming from consumers. Just 25 percent of the sales at 
      link hidden, please login to view, which owns NAPA, comes from people popping their own hoods to fix that troublesome rattle. "Amazon is obviously more of a risk to an AutoZone which does a majority of their business in DIY," Jordan said. He added that AutoZone is making a big push into serving commercial customers where there's more potential growth.
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      link hidden, please login to view , link hidden, please login to view , link hidden, please login to view , Amazon and privately-owned link hidden, please login to view. By their measures, Advance holds up best. ILLUSTRATION: RAYMOND JAMES “Advance’s and O’Reilly’s websites offer a slightly more attractive alternative to Amazon’s,” the analysts wrote, “particularly for DIY customers that are either 1) looking for useful browsing features, 2) seeking information on parts, or 3) wanting to buy online and pick up in store.”
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