Supermarkets are using auto supplies, now a mainstay segment in general merchandise, as a competitive wedge against the mass merchandisers.
Rogers Markets, Fort Wayne, Ind., for example, has built its auto supply mix in 4-foot to 12-foot sections around the basics: antifreeze, motor oils, waxes and polishes. The mix "keeps our customers from going to Wal-Mart for these items," said Renee Seaman, nonfood buyer.
With the proper mix of products and pricing, retailers can make good profits merchandising auto supplies, according to an SN poll.
At Cannata's Food World, Morgan City, La., the auto supply mix is composed of "high-usage and -impulse items, including engine treatments, antifreeze, waxes and polishes, and motor oils," said Warren Guidry, nonfood buyer-merchandiser.
"That's what does 99% of sales in our 12-foot sections, where we usually will feature things like antifreeze at a really hot price and offer the other items, including novelties, at full margin."
Guidry said although the auto category as a whole "has changed and does fair [business], it still merits the space. On things like coffee cups and air fresheners that sell for up to $5, we can make full margins of around 35%. This is higher profit than on motor oils."
Joe Sinkula, director of general merchandise, health and beauty care, and pharmacy at Haggen, Bellingham, Wash., said motor oils are good promotional sellers, but the chain doesn't make money on them when on promotion.
Instead, the chain will promote antifreeze and windshield washer fluid more frequently. Said Sinkula, "Although we sell less windshield fluid, we make more on it than oil.
"Basically, you're turning dollars [with such promotions]. We're promoting windshield washer fluids, STP products, Gumout and waxes also to attract customers to the accessories that have better margins."
The concern for better car maintenance also is keeping sales solid in the section. "People who keep their cars longer look for ways to cut their auto cost. Therefore, products that protect the exterior and engine -- refills like sealers, power-steering fluid, engine treatments and fuel-injector cleaners -- do the best sales in the whole automotive category," said Kim Schell, general merchandise buyer at Nash Finch Co., Minneapolis.
Retailers like Sinkula point to an improving economy that will stimulate new car sales, further spurring demand for auto supplies. "With a $20,000 investment in a new car today, people buying new cars will want to keep them new and care for them," he added.
Haggen has redefined its mix in its 8-foot auto section and focuses only on key items such as motor oils, antifreeze and windshield washer fluid.
Retailers report women are equally as important consumers as men in buying engine additives, motor oils, Gumout, waxes and high-profit accessories.
"Sales are equally divided between men and women," said Seaman. "Although at a couple of our stores in a lower-income area you'll see men come in, and that may be all they're getting."
At Copps Corp., Stevens Point, Wis., the auto supply assortment focuses on "the basics, as we concentrate on and carry the best of the best products that appeal to the female shopper. They account for 80% of our business," said Arlyn Clark, general merchandise buyer.
Nash Finch has taken auto supplies into the private-label arena by introducing a store-brand motor oil and transmission fluid as an alternative choice for its customers.
The addition of the new controlled label "is something we can put out at 99 cents. It has gotten strong consumer acceptance," said Schell.
"We still do a good job with national brands like Prestone and Quaker State oils, but the controlled label offers shoppers 30- to 50-cent savings over national brands. It's a good impulse item, especially with customers that have older cars that burn oil."
He said retailers promote washer fluids, ice-melting products and engine coolants, primarily in winter months. Rogers Markets only handles branded motor oils, "which is a key that definitely helps our auto supply sales do well. People want to make sure they're getting known brands like Citgo, Pennzoil and Quaker State," said Seaman.
But besides promoting the motor oils in three facings per brand of 10-30 and 10-40 weights, Rogers displays accessories that are good impulse items and give the retailer full margins.
