How To Build And Grow Your Automotive Aftermarket Parts Business

How To Build And Grow Your Automotive Aftermarket Parts Business

Building an automotive aftermarket parts business can be a lucrative endeavor, but it’s important to do your research first. In this guide, we’ll talk about what automotive aftermarket parts are and the benefits and drawbacks of selling them. We’ll also discuss how to organize and manage an auto parts business. If you’re thinking about starting an automotive aftermarket parts business, now is a good time to do it!

What Are Automotive Aftermarket Parts and Accessories?

Automotive aftermarket parts are replacement parts and accessories that are available after the vehicle’s initial sale. Aftermarket parts can be used to repair, beautify, or improve a vehicle’s performance. Many automotive aftermarket businesses specialize in selling performance-enhancing parts, such as exhaust systems and engine modifications, among many others.

Aftermarket parts and accessories can be compared to original equipment manufacturer (OEM) parts, which are the parts that are installed on a vehicle when it is first manufactured. OEM parts are also those made by the same manufacturer as the vehicle and will be used as replacements at a later date.

It’s also important to mention that most automotive aftermarket parts and accessories are specifically designed to fit more than one vehicle model or brand. This means that automotive aftermarket businesses have the potential to reach a larger audience than businesses that sell OEM parts.

Is It A Good Time To Build An Automotive Aftermarket Parts Business?

According to statistics, automobile component usage reached a new peak in June 2020, when it surpassed $50 billion for the first time. July figures showed $49.884 billion in purchases, whereas August increased to $50.303 billion. Aftermarket tires’ consumer usage hit an all-time high in June 2020 at $35.504 billion.

In 2022, the online auto component and part market in North America will be worth $26.1 billion. It will rise by more than 40% from 2020. In 2022, the light-duty vehicle aftermarket market size is expected to be about $341 billion. The overall automobile aftermarket/auto care industry is anticipated to be worth around $439 billion in 2022.

In the United States, for example, there will be roughly 278 million light vehicles on the road by 2029. These cars will have an age of approximately 12 years. Nobody should invest in a startup company if it operates in an industry that is declining, as any venture capitalist can tell you. What these figures reveal is that the aftermarket for automobiles is a lucrative one with potential for expansion.

There are several trends and factors that have helped the automotive aftermarket sector see such a spur in growth. These include the following:

  • Aging vehicles: The average vehicle on the road is now a record 11.92 years old. This means that, with older and older vehicles on the road, the need for replacement parts is also on the rise. As an automotive aftermarket retailer, you can take advantage of this trend by stocking your store with the parts that these older vehicles will need.
  • More miles are driven: In 2021, Americans drove an estimated 3.23 trillion miles. Similar to the point above, the more miles driven, the more likely vehicles will need repairs or replacement parts.
  • Do-It-Yourself culture: Many people are interested in working on their own vehicles to save money or for personal satisfaction. In addition, the DIY culture has been further popularized by YouTube videos and other social media content.
  • The COVID-19 pandemic: While the Coronavirus pandemic has had a serious negative impact on new car sales, it had an opposite effect on the automotive aftermarket industry. In fact, the automotive aftermarket sector was one of the few that actually saw growth during this time. This can be attributed to the fact that, with people spending more time at home, they had more time to work on their own vehicles. They’ve stopped buying new cars and started repairing, beautifying, or upgrading their existing ones.
  • More aftermarket part options than OEM components: Automotive aftermarket parts manufacturers continue to innovate and create new products for consumers. This provides automotive aftermarket businesses with a wide range of products to choose from when stocking their store. In turn, customers have more options when it comes to repairing or upgrading their vehicles.
  • Rise of eCommerce: The automotive aftermarket industry has been quick to embrace eCommerce. In fact, the automotive aftermarket eCommerce market is expected to grow from $24.78 billion in 2020 to $40.21 billion by 2025 at a whopping compound annual growth rate (CAGR) of around 20%. Online marketplaces such as Amazon, eBay Motors, or Walmart, among others, have made it easier than ever for automotive aftermarket businesses to reach a wider audience and sell more car parts than ever before.

As you can see, there are many reasons why now is a great time to be in the automotive aftermarket business.

What Are The Benefits of Selling Automotive Aftermarket Parts and Accessories?

When it comes to selling auto parts and accessories, it’s important to understand both the pros and cons of doing so. The main reason for this is that it helps you understand and prepare for what’s to come. That said, there are some of the major benefits of selling aftermarket components:

  • The automotive aftermarket sector is on the rise: As we mentioned earlier, the automotive aftermarket sector is growing at an increasing rate. This is a major benefit for those looking to enter the market since it means that their chances of success are also higher than in other industries.
  • More product variety compared to OEM parts: Automotive aftermarket offers a wide variety of product choices. This is great news for businesses, as it gives them the opportunity to cater to a wider range of customers. Third-party part manufacturers look to enter the market with new and innovative products, which keeps the automotive aftermarket fresh.
  • Lower part and accessory prices: In general, automotive aftermarket parts and accessories are cheaper than OEM parts. This is due to the fact that third-party manufacturers don’t have the same research and development costs as original equipment manufacturers. Additionally, automotive aftermarket businesses can source parts from multiple suppliers, which gives them more negotiating power and allows them to pass on savings to their customers.
  • More opportunities to specialize in a specific niche: Aftermarket parts and accessories give automotive businesses the chance to specialize in a specific niche. This is because there are so many different types of aftermarket products available. For example, a business could focus on selling performance-enhancing parts, body kits, or interior upgrades. In doing so, businesses can build a strong reputation in their chosen niche, which will help them attract and retain customers.
  • Better quality: Automotive aftermarket parts have to meet a high standard in order to be successful. This is because customers are often looking for replacement parts that are of equal or better quality than the OEM parts they’re replacing. As such, automotive aftermarket businesses need to make sure that their products meet or exceed customer expectations in order to be successful.

What Are The Drawbacks of Selling Automotive Aftermarket Parts and Accessories?

Selling aftermarket auto parts and accessories also has its series of disadvantages that retailers may have to deal with while running their business. Among these, we can include the following:

  • Questionable quality: While we did mention product quality in the pros column, it’s important to mention that not all third-party automotive aftermarket parts and accessories are made the same. There have been instances where automotive aftermarket parts have been known to be of inferior quality when compared to OEM parts. This is often because automotive aftermarket businesses may cut corners to produce their products at a lower cost. This is why it’s important to source your suppliers very carefully.
  • Increased competition: As the automotive aftermarket sector continues to grow, the level of competition is also increasing. This is great news for consumers who now have more choices when it comes to automotive aftermarket products. However, it can make things more difficult for businesses that need to differentiate themselves from the competition.
  • Lack of customer loyalty: One of the challenges that automotive aftermarket businesses face is that their customers are often not loyal. This is because automotive aftermarket products are seen as being interchangeable, and customers often purchase the cheapest option available. To combat this, businesses need to focus on providing outstanding customer service and offering products that are of a higher quality than their competitors.
  • Warranty issues: Automotive aftermarket businesses often have to deal with warranty issues. This is because most automotive manufacturers offer a warranty on their OEM parts but not on aftermarket parts. As such, businesses need to make sure that their customers are aware of this before they purchase any products.
  • Lack of customer awareness: Another major drawback of selling aftermarket components is that many potential buyers are unaware of their existence or that many of these parts will fit their vehicles just as well as OEM parts. It’s for this reason that it’s important for aftermarket retailers to ensure that their fitment data is always accurate and up-to-date. Put simply; fitment data is the information that tells you whether or not a particular automotive aftermarket part will fit your vehicle.

Even though there are some drawbacks to selling automotive aftermarket parts and accessories, the advantages often outweigh the disadvantages. Automotive aftermarket businesses provide consumers with more choices, better quality, and lower prices. In addition, automotive aftermarket businesses help create jobs and boost the economy. If you’re thinking of starting an automotive aftermarket business, now is a great time to do so.

Just make sure that you source your suppliers carefully, focus on providing outstanding customer service, and make sure that your fitment data is always accurate and up-to-date. Do this, and you’ll be well on your way to success.

How To Organize Your Automotive Aftermarket Parts Business?

Now that we’ve gone over the pros and cons of selling automotive aftermarket parts, it’s time to give you some tips on how to organize your automotive aftermarket business.

Develop A Business Plan

The first thing you need to do is develop a business plan. This document will outline your business goals, strategies, target market, and financial projections. Having a business plan is essential for any successful business, so make sure you take the time to create one.

Basically, your business plan should answer the following questions:

  • What are your business goals?
  • Who is your target market?
  • What automotive aftermarket products do you plan on selling?
  • How will you differentiate yourself from the competition?
  • What are your marketing and advertising strategies?
  • How much money do you need to start your business?
  • When do you expect to turn a profit?

Once you have answers to these questions, you’ll be well on your way to starting a successful automotive aftermarket business. If you need help creating a business plan, there are plenty of resources available online. You can also hire a professional consultant to help you get started.

Have SMART Goals

In order for your automotive aftermarket business to be successful, you need to make sure that your goals are SMART. SMART is an acronym that stands for Specific, Measurable, Achievable, Realistic, and Time-based.

For example, a SMART goal for your automotive aftermarket business might be “to increase sales by 20% within the next year”. Another SMART goal might be “to open two new retail locations within the next five years.” A bad example would be something like “to sell as many car parts and accessories as quickly as possible.” This type of goal is not specific, measurable, or time-based, which means that you’ll never be able to tell if you’ve achieved it or not.

Choose a Legal Structure for Your Business

Next, you need to choose a legal structure for your business. The most common options for automotive aftermarket businesses are sole proprietorships, partnerships, limited liability companies (LLCs), and corporations. Each option has advantages and disadvantages, so be sure to choose the one that’s right for you.

  • Sole proprietorships are the simplest and most common type of business structure. They’re easy to set up and don’t require any special paperwork or fees. The downside of a sole proprietorship is that the owner is personally liable for all debts and losses incurred by the business.
  • Partnerships are similar to sole proprietorships but involve two or more owners. The biggest advantage of partnerships is that they allow business owners to pool their resources and expertise. The downside of partnerships is that the partners are personally liable for all debts and losses incurred by the business.
  • LLCs offer some protection from liability, but not as much as corporations. The biggest advantage of LLCs is that they’re easy to set up and maintain. The downside of LLCs is that they can be more expensive to set up than sole proprietorships or partnerships.

Choose A Product Niche

One of the best ways to succeed in the automotive aftermarket industry is to choose a product niche and focus on selling products that are related to that niche. By specializing in a particular type of product, you’ll be able to better meet the needs of your customers and differentiate yourself from your competitors.

Some examples of automotive aftermarket product niches include:

  • Performance parts
  • Exterior accessories
  • Interior accessories
  • Tire and wheel products
  • Vintage car parts and accessories

Of course, this is just a small sampling of potential product niches. There are thousands of different types of automotive aftermarket products out there, so you’re sure to find one that’s right for your business.

Sourcing Products

Once you’ve chosen a product niche, it’s time to start sourcing automotive aftermarket products. There are a few different ways to do this:

  • Buy products from a wholesaler or distributor.
  • Manufacture your own products.
  • Source products from China or other overseas markets.

Each of these options has its own set of pros and cons, so be sure to choose the one that’s right for your business. Various procurement tools will help you stay on top of automotive aftermarket trends, so be sure to invest in one or two of these as well.

Work With The Right eCommerce Platforms

If you plan on selling automotive aftermarket products online, then you need to make sure you’re working with the right eCommerce platforms. The two most popular options for automotive aftermarket businesses are Amazon and eBay Motors.

Amazon is the world’s largest online retailer, so it’s a great platform for automotive aftermarket businesses of all sizes. The downside of Amazon is that it’s a very competitive marketplace, so you’ll need to make sure your products are priced competitively.

eBay Motors is the world’s largest online marketplace for automotive aftermarket products. The advantage of eBay Motors is that it’s much less competitive than Amazon, so you’ll have an easier time selling your products. The downside of eBay Motors is that it doesn’t have the same reach as Amazon, so you might not be able to sell as many products.

Walmart is another option to consider, especially if you’re selling automotive aftermarket products that are related to automotive maintenance or repair. Walmart is a very popular destination for US buyers, so you’ll be able to reach a large national audience.

Focus On Fitment Data Accuracy

Pretty much no other industry has to deal with fitment data as the automotive sector has to. Put simply, fitment data is the information used to determine whether or not a particular automotive aftermarket product will fit a specific vehicle. It contains general information such as the year, make, and model of the vehicle, as well as more specific data in the form of engine and fuel type, transmission, product ID, promotional material, and more.

One of the biggest challenges facing automotive aftermarket businesses is ensuring that their fitment data is accurate and up-to-date. If your fitment data is inaccurate, then customers are going to have a hard time finding products that fit their vehicles. This can lead to customer frustration, returns, and negative reviews – all of which can damage your business.

To avoid this, you need to make sure you have a fitment data management system in place, such as Illumaware’s Evokat Premier. This system should be designed to help you collect, manage, and update your fitment data on a regular basis. Additionally, your eCommerce platform should have a fitment data integration that allows customers to filter products by their vehicle.

By ensuring that your fitment data is accurate and up-to-date, you’ll be able to improve the customer experience and reduce returns. This will ultimately lead to more sales and a healthier automotive aftermarket business.


If you’re thinking about starting an automotive aftermarket business, then now is a great time to do it. The automotive aftermarket is a huge industry, and there’s a lot of money to be made. Just be sure to keep the tips in this article in mind, and you’ll be well on your way to success. For more information on how to run a successful automotive aftermarket business, feel free to check out our other resources or contact us directly.