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PartZone, Inc. Announces Launch

29 August 2000

PartZone, Inc. Announces Launch: Brings Recycled Auto Parts Industry Online; Second Round of Venture Capital Funding Completed

    EVANSTON, Ill.--Aug. 29, 2000--PartZone, Inc. today announced that its new marketplace for recycled auto parts has opened its virtual doors with the largest inventory of recycled original-equipment parts in Illinois. The company also said it has completed a second round of financing, with SilverYoung Partners leading and ForeFront Capital participating.
    PartZone is a new solution for the single biggest hurdle facing automotive repair shops: searching multiple automotive recycling facilities to obtain quality recycled parts. More than just an Internet exchange or online catalog, PartZone (www.partzone.com) is a full-service distributor that locates parts, arranges delivery and assures quality.
    "PartZone's focus on recycled parts addresses a major challenge for the more than 200,000 automotive repair shops in the United States," said Eric Koenig, president and chief executive officer. "The demand for recycled parts is increasing as professional mechanics and insurers turn away from new aftermarket parts because some fail to meet `like kind and quality' standards collision repair policies specify. Recycled parts are an ideal solution because they are original equipment parts, and PartZone guarantees their quality."

    Pilot Test Demonstrates Demand for Service

    The company recently completed a successful pilot launch of its online marketplace. The trial began by giving 35 repair shops and insurance company estimators access to five auto recyclers whose combined inventories made PartZone the area's largest source for recycled auto parts. The company now is adding several suppliers a week and will have a nationwide supply base this fall.
    According to beta test participants, PartZone replaces parts-chasing with one-stop shopping that saves time for repair shops. "Anything that keeps me off the phone is worthwhile," said Dick Peach of Dempster Auto Rebuilders. "If I can save 15 minutes on each repair job or a few hours a week, that's a major dollars-and-cents impact."

    PartZone a "Virtual Distributor"

    According to a 1997 survey by the Automotive Recyclers Association, the recycled parts business is estimated to be $7 billion in annual sales. Recycled OEM parts cost less than new OEM parts and offer better quality and fit than many aftermarket parts. Yet recycled parts are underutilized because they are difficult to obtain. PartZone changes this by managing the recycled parts process from end-to-end for the auto repair industry by providing:

- Broad selection: Access to actual inventories of PartZone affiliated recycling facilities, available to both automotive repair professionals and insurance estimators.
- Quality: PartZone's e-commerce engine filters out damaged, poorly described or questionable quality parts to provide customers with only the highest quality parts. Customers are given an accurate description of the part's condition. Each part is individually inspected prior to delivery by PartZone network suppliers and all parts come with PartZone's certified quality label and a 90-day warranty.
- Customer Service: In addition to providing Web access, PartZone offers a call center where customers can order parts and receive expert assistance. The call center allows PartZone to serve a larger market and facilitates complicated orders.
- Accountability: Suppliers are subjected to a rigorous screening process before they are affiliated with PartZone. They are further rated to ensure continuing customer satisfaction.
- Choice: Customers specify a delivery time frame and PartZone shows only the parts that can be shipped in that time frame. The price shown is the total delivered part cost, allowing customers to fully evaluate each part alternative.
- Efficiency: Purchasers pay by credit card or set up a trade account. This approach offers the convenience of buying from multiple suppliers but dealing with just one vendor - PartZone.

    Accurate Data Is Key