O’Reilly has a strong distribution network
O’Reilly has a strong distribution network. The company’s inventory management and distribution
systems electronically link each of its stores to a distribution center (DC), providing efficient inventory
control and management. Its distribution system provides each of the company’s stores with same-day or
overnight access to an average of 157,000 stock keeping units (SKUs), many of which are hard to find
items not typically stocked by other auto parts retailers. This timely access to a broad range of products is
a key competitive advantage in meeting the demand of its customers and generating repetitive business.
The company currently operates 27 regional DCs. O’Reilly Automotive’s DCs provide five-night-a-week
delivery, primarily via its fleet, to all of the company’s stores in the US. The company operates 331 Hub
stores that also provide delivery service and same-day access to an average of 48,000 SKUs to other
stores within the surrounding area. Hence, a strong distribution system reduces business risk of the
company by allowing it to supply products on timely basis and guaranteeing efficient customer service.
