Federated Auto Parts Distributors and the

National Pronto Association

Announce Merger
We are pleased to announce today that two leading program groups, National
Pronto Association and Federated Auto Parts have agreed to merge a majority
of their efforts and resources together to improve service and support to all
constituents in the future.
This merger will have combined sales volume exceeding $7B with more than 5,000
outlets in North America allowing it to improve member services and better compete
with anyone in the aftermarket. This newly formed organization will be known as
Automotive Parts Services Group or simply The Group.
The merger will build upon what is best from both organizations maintaining current
leadership and office staff with a focus on improvement. Both the Federated Group
and National Pronto Group will continue to serve their members needs but will work
together to focus on improvement in every possible area.
Moving forward, the two organizations will work to combine their efforts in customer
support programs, IT and data management, electronic catalog, co-man warehouse,
national accounts, and line commonality.
Both Pronto and Federated Headquarters will remain in place and continue to
support their respective members needs, marketing programs, and brands, while
moving to shared resources in all areas that offer efficiencies and improvement
opportunities to remain competitive in a changing market.

The following are

announcement:

some

frequently

asked

questions

regarding

this

Q. Who will run the new organization?

A. Bill Maggs and Rusty Bishop will be co-CEOs of the new organization while also
maintaining their current roles with Pronto and Federated. The goal of the new
organization is to build on the success, cultures and relationships both groups have
had in the past while working together for a stronger future.
Q. What happens with other staff members and group employees?
A. Both Pronto and Federated have a strong history of operating lean and mean.
The plan is to maintain all current people and positions with a goal to share best
practices, increase value and effectiveness. In most areas, the emphasis will be on
improved programs and support with no added cost. Leadership will look to develop

succession plans and an evolving organizational structure will be created to

maximize collaboration efforts.
Q. So if staffs and offices stay the same, what changes?
A. Potentially everything else! There have been a number of meetings to identify the
potential for creating benefits for all members, suppliers, customers, and employees
and the opportunities are substantial. For example, there are benefits in collaborating
on National Accounts, Data Management, Electronic Catalog, Inventory Management
and Availability, Purchasing, Warranty and Roadside Assistance programs, Co-Man
Warehouse, Direct Importing, Internet Support, and Training, just to name a few.
Q. Will the members from both groups actually act as one?
A. The merger received outstanding support by members of both groups. Every
participant is dedicated to exploring ways to improve through collaboration including
combining certain national meetings. Every topic has been discussed and there is
philosophical agreement on direction in every important area. The Leadership
understands what it takes to make a merger successful and is dedicated to making it
work for everyone. While a group this size will always have some market and product
exceptions; the goal is a united direction wherever there is benefit.
Q. How will decisions be made?
A. There will be defined processes for all areas of decision making with leadership
and members involved based on effective and timely communications. Everyone is
dedicated to working together as collaborative partners with a goal of efficiently
making logical decisions based on extensive analysis, insight and input from all.
Q. You mentioned Co-Man, will Pronto members be able to use the Federated
Co-Man Warehouse?
A. Yes. Pronto members will have the option of participating in the Co-Man
warehouse. This is a good example of leveraging current resources across a larger
enterprise. With enhanced volume and growth there will be increased activity in all
areas of Co-Man including purchasing, warehouse, logistics, payables, and
receivables. This is certainly an area where the merger will likely create jobs rather
than eliminate them.
Q. How will purchasing and merchandising work? Will this be combined?
A. The merger will provide for combined line reviews and leverage of combined
volumes. The goal is to be competitive with large competitors at acquisition cost. This
merger brings together two groups who focus on top quality brands with value added
benefits and features backed with outstanding service and extensive training.
Q. What does this mean for suppliers?
A. Ultimately fewer meetings for our vendor partners, more efficient relationships, a
more line common customer base, better partner for National Accounts, more
information, sales growth, ability to sell product benefits, unique focus on DIFM, and
much more. It should be looked at as an opportunity to sell more and influence mix.

Q. Are other groups likely to follow and merge?

A. Only time will tell but it is likely that others will feel the need to try and do
something. However, what will make the Federated/Pronto merger successful are a
number of unique attributes others may not possess. These begin with a lack of

market conflicts. There are minimal market conflicts between members of the two
groups and in many markets there are positive working relationships. It is a merger of
equals with a focus on equal collaboration that is fair for all. Both groups are
dedicated to making the merger benefit ALL members from the largest to the
smallest. The overall focus is on selling more and operating more efficiently while
sharing resources and expertise. Both groups have similar cultures, maintain rightsized staffs, and focus on partnerships with their vendors. In summary, they are more
alike than different. Each has a strong, single marketing brand that will continue to be
supported and membership focused on growth and long term success. Ultimately
these two groups have all the elements in place to make it work.
While we have identified many areas of opportunity and potential improvement.
We do not have all the answers today and will not tomorrow. This will be a
process that continues to evolve and requires great collaboration and
dedication from all. However it is the right thing to do for everyone involved
and these are the right parties to make it work. The future is now much clearer
and positive for members of this merger and the vision will be further
enhanced as time goes on.