Over the past few weeks, a number of national distributors have released their 2024 performance and earnings reports. AD, Grainger, Fastenal and others have made news. We’ve also talked to a number of manufacturers who see the “highlight” numbers and use them as benchmarks, so we’ve reviewed and sought to find some trends.
Overall, business is improving or stable depending on your perspective.
AD
AD News: AD owner/members reach a record $83.3 billion in 2024 the largest marketing group in the B2B Industrial Channel.
AD owner/member sales increased 6% to $83.3 billion. On a same-store basis, member sales in their respective currencies increased 4% in the U.S., 3% in Canada, and 10% in Mexico.
Purchases by member companies from AD supplier partners were up 5% to $20.7 billion. Net distributions to owner/members increased 5% to $1.45 billion.
In 2024, AD welcomed 110 new members to its community of independents through a combination of organic growth and the merger with the Edge Group, the Electronics, Low Voltage, Data and Security group that joined its Electrical – U.S. Division early in the year. While 22 members sold their businesses outside the group during 2024, existing AD members acquired 57 companies outside of the group and 13 fellow members. AD’s total member count at the end of 2024 was 932.
Total company sales up 6% (remember, this is across AD’s many divisions, not industrial only)
AD represents a number of the large electrical distributors in the industry and most of the independent Rockwell distributors in the US, which creates a strong industrial exposure for the channel. It is a good benchmark for “balanced” distributors. Reading between lines, it is important to note that overall same store sales across all the channels they serve is up 6% while purchases from AD suppliers are up 5%. I would a expect a continued focus in 2025 on driving more purchases to AD Suppliers by the organization to close the small delta.
GRAINGER
Grainger released their 2024 full year results on January 31st, 2024. Below are their market insights:
W.W. Grainger, Inc. – GRAINGER REPORTS RESULTS FOR THE FOURTH QUARTER AND FULL YEAR 2024
Fourth Quarter 2024 Highlights
- Delivered sales of $4.2 billion, up 5.9%, or 4.7% on a daily, organic constant currency basis
- Achieved operating margin of 15.0%, up 110 basis points on a reported basis, or up 40 basis points on an adjusted basis
- Increased diluted EPS to $9.71, up 23.1% on a reported basis, or up 16.6% on an adjusted basis
Full Year 2024 Highlights
- Grew sales to $17.2 billion, up 4.2%, or 4.7% on a daily, organic constant currency basis
- Realized reported operating margin of 15.4%, or 15.5% on an adjusted basis, down 20 basis points
Some takeaways that I took that were shared specifically on continued growth of Zoro. (Please note at IST we will share deeper analysis on the full Grainger year end results when they release the full annual report)
- Grainger Added over 1.4M new products to Zoro
- Increased Zoro registered users by +12% across the segment
- Grew enterprise customer revenue at MonotaRO by +29%
- Leveraged enhanced data and analytics capabilities
to drive improved repeat purchase rates - Improved delivery experience at ZoroGrowth in the industrial segment
FASTENAL
On January 17th Fastenal Released their Q4 and Annual Results.
One line that caught my attention was from the CEO “Daily sales growth of 2.1% was a frustrating finish to a challenging year. Deleverage stemming from weak
demand, compounded by low seasonal volumes and sharp year-end factory shutdowns.” I find the comment interesting as although Fastenal might be frustrated with the results overall in 2024 were solid in my opinion.
- 2024 Sales were $7.546 Billion (up 2.7% versus 2023) and Gross Profit Dollars were $3.401 Billion (up 1.4% versus 2023)
I have written on and covered Fastenal in Depth with our close friends at Modern Distribution Management and would encourage you to follow the link below to the deep analysis of Fastenal that we have done over the past year below.
MDM Podcast: A Breakdown of Fastenal’s Decade-Long “Big Pivot” – Modern Distribution Management
The link will take you to a podcast and the Fastenal 3-part series and case study report.
Hopefully some of these insights help you in comparing your performance. Some trends that caught my eye for 2025…
Grainger gave 2025 guidance – “Solid revenue growth expected across both segments – 2025 guidance, including 4.0% – 6.5% daily, constant currency sales growth”
That guidance indicates that 2025 may be a slower growth year for Industrial, but it appears the market will grow. That’s a positive sign for 2025.
What are you seeing from these companies? Competing against them? Selling through them? Are they taking share? Competing on price?
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