As the business struggles to balance declining customer demand and rising costs, Advance Auto Parts revealed on Thursday that it plans to close more than 700 places in the US.
In a Thursday media launch, the classic car part firm announced that it will shut 523 Advance organizational locations, 204 separate locations, and four distribution centers by the middle of next year. Advance Auto Parts also stated that it would reduce its labor, but the company would not say how many jobs would be affected by the approaching store closures.
As part of Advance Auto Parts ‘ Thursday fourth quarter profits report, over 700 business closures were made public. According to the report, the company’s close keep selling decreased by 2.3 %. Additionally, according to the report, Advance Auto Parts experienced higher costs “due to pay opportunities in frontline staff members that were partly offset by a decrease in advertising expenses.”
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Advance Auto Parts also announced on Thursday that the company completed the sale of Worldpac, an auto parts wholesaler, at the beginning of the month for$ 1.5 billion.
In a press release released on Thursday, Advance Auto Parts CEO Shane O’Kelly stated,” We are pleased to have made headway on our corporate initiatives, including the implementation of the purchase of Worldpac and a thorough functional performance evaluation of our company.”
O’Kelly continued,” We are charting a clear way forward and introducing a new three-year financial program with a emphasis on executing key retail elements to increase the productivity of all our property and increase shareholder value.”
Advance Auto Parts anticipates that the company’s restructuring and the closure of several hundred store locations will result in costs ranging from$ 350 million to$ 750 million, according to a press release on Thursday. Advance Auto Parts believes that the restructuring process does improve the company’s operating revenue ratio through Governmental Time 2027 by more than 500 basis points.
