Jose Pico and other O’Reilly Auto Parts employees had a busy day Saturday at two new locations in Puerto Rico.
“We had thousands of people coming in who were buying parts,” said Pico, director of business development for O’Reilly Automotive. “O’Reilly has been wanting to come to Puerto Rico for some time. With the opening, now everyone’s talking about it. We’re looking forward to being part of the O’Reilly family.”
The Springfield-based auto parts company expanded its footprint into the U.S. territory with the opening of a distribution center and two retail stores in Puerto Rico.
The distribution center and one of the stores is in Bayamon, located outside of capital city San Juan in the northeastern corner of the island. The other store is located in Hatillo, on the northwest corner.
Ribbon cutting ceremonies were held for both locations over the weekend, according to a press release from the company.
Same strategy, different territory
(Photo: Courtesy O'Reilly Automotive)
The logistics arrangement is similar to the model the company uses in the U.S. and Mexico: Keeping a distribution center near retail stores helps ensure quick delivery of parts, said Mark Merz, senior vice president of finance.
“It’s been one of our competitive advantages since our first stores opened in ‘57,” Merz said. “It comes down to our focus on a distribution-intensive model, where a center can carry parts very close to where stores are located. That way we can replenish stock multiple times a day.”
The ceremonies capped off a multi-year effort to open in the U.S. territory, Merz said.
The auto parts store attempted to open in Hatillo in 2020, according to a report from Puerto Rico-based publication News Is My Business. The 10,300-square-foot store was halted, however, because of COVID-related issues.
Hurricane recovery
The island has also suffered through the damage of recent hurricanes. In 2017, Hurricanes Maria and Irma struck the island within weeks of each other. Maria alone killed more than 3,000 and caused more than $100 billion in damages, according to information from the National Oceanic and Atmospheric Administration.
Then in September of 2022, Hurricane Fiona led to 25 deaths and $2.6 billion in damage, undoing many of the repairs made to the island’s power grid.
The island is coming back, Pico said, as recovery efforts continue. Pico said that support from the U.S., both financially and with the U.S. Army Corps of Engineers, is helping the territory move the island forward enough to attract new business.
“It’s definitely an honor to have new businesses coming to Puerto Rico,” Pico said. “It creates new opportunities for people here. Maria hit us very hard, and it has been a big struggle with plenty of challenges. But we’re a resilient people, and we’re ready for business.”
International expansion
O’Reilly operates more than 5,980 stores in 48 states across the U.S. and Puerto Rico, and also runs 43 stores under the name Orma in Mexico. About 20 of the Orma stores were acquired in 2019 through a partnership and merger with Mayasa Auto Parts — Merz said the number of Mexican stores has grown to more than 40 since then.
Pico said business will look similar to anyone familiar with O’Reilly in Springfield. Stores will keep stock for makes and models that are common across the island — Pico said Puerto Ricans are driving a lot of Hondas and Toyotas these days, with Fords remaining popular and Dodges surging.
Of the dozens of people who have been hired, Pico said about 15 of them work in the 128,000-square-foot Bayamon distribution center. The rest work at the stores assisting customers in a rush of business that has remained steady since the weekend, Pico said Tuesday. Both stores are open seven days a week.
While sending products to Puerto Rico will require more advanced planning and investment, from shipping routes to dealing with value-added and import taxes, Merz said the island is ripe for growth — the company would like to open more stores there in the coming years.
“We believe that Puerto Rico is a fantastic market,” Merz said. “We’re excited to be there.”
