07/26/2024

The Future of Aftermarket Distribution

Source: aftermarketNews

Brian Cruickshank’s journey in the aftermarket industry began at Babcox Media, his first job right after college. Initially envisioned as a temporary position, his role evolved into a 29-year career that laid the foundation for his industry expertise. At Babcox, Cruickshank worked across various segments, starting as a junior editor for Underhood Service magazine. Cruickshank ultimately became the editor of Counterman Magazine and aftermarketNews, experiences that gave him comprehensive insights into the distribution market and prepared him for his current role as a Partner at Schwartz Advisors.

Cruickshank’s engagement with the aftermarket community extends beyond his editorial roles. His involvement with Auto Care Connect, which began during his early career, has been a significant part of his professional development. This involvement continues today, with many Schwartz Advisors’ team members actively participating in Auto Care initiatives. 

Cruickshank’s tenure at Counterman provided a front-row seat to the significant changes in distribution. He witnessed numerous major acquisitions, such as O’Reilly’s acquisition of CSK. These events were part of a broader trend of consolidation that has transformed the landscape of the aftermarket distribution sector. When Cruickshank entered the industry, he remembers more than 15 program distribution groups. This number has since dwindled due to mergers and acquisitions, illustrating the ongoing consolidation within the industry.

Cruickshank notes that the consolidation trend shows no signs of slowing. Schwartz Advisors is deeply entrenched in the distribution sector, and firsthand experiences suggest that interest in both light vehicle and heavy-duty distributors remains strong. While the light vehicle distribution market is more mature, there’s increasing activity in the heavy truck segment. Factors driving this consolidation include the desire of founder-owned companies to either exit or find well-capitalized partners to support growth.

Despite the ongoing consolidation, Cruickshank believes there is still a viable future for independent distributors. He anticipates that the number of distributors will continue to shrink, driven by acquisitions and interest from private equity. However, he underscores that well-run, profitable regional and local distributors will continue to have a place in the market.