Last month Fastenal reported sales of $751.5 million, putting them on track for around $9 billion (or slightly more at their growth rate) at the end of the year.
May’s corporate sales were up nearly 15%.
Looking at it from customer market perspective:
- Heavy manufacturing customers up by 18.7%
- Non-residential construction sales increased by 16%
- Other manufacturing sales climbed by 11.5%
- and all other end markets were up by 12.4%.
From a customer base perspective, sales to OEM customers were up 16% and MRO sales increased 14.5%.
Fastenal YTD
But numbers can be deceiving. While yes, the highlight number is 15%, YTD they have grown only 13.3% in the US. Perhaps May is inferring there will be an uptick, or is it an anomaly?
Digging into the product category insights:
For OEMs:
- Fastener hardware is up, YTD, 15.9%
- Cutting tools and abrasives is up 13.2%
- Non-fasteners hardware is up 17.2%
For their MRO business:
- Fastener hardware is up, YTD, 15.3%
- Safety is up 13.8%
- Non-fasteners hardware and non-safety is up 14.7%
And contract customers are up 18% whereas non-contract customers are up only 8%. Further, their eBusiness is up only 11%.
Based upon this it can be inferred:
- Fastenal gained share in the heavy manufacturing sector. Either some / many of their customers had their sales growing, hence that trickled down to Fastenal, they took share within existing accounts, or they won new accounts.
- The non-residential growing “slower” is not a surprise as the commercial construction market is slow, and declining. There are many factors that continue to challenge this market. The 16% growth either highlights a focus on selected verticals that is driving account penetration or perhaps some new opportunities.
- They are focused on their large contract business. For the non-contract business to be up only 8%, and accounting for price increases, there is nominal growth in this customer group.
- For Fastenal competitors, especially independents, it says “Fastenal excels where they are embedded. They are vulnerable, or “not to be feared” in other accounts. Perhaps they win on the fastener / hardware category, and probably manufacturers have price / availability allegiance to them but if your strength is elsewhere, you can win on many other buying attributes.
Pulse of Industrial Supply
Last quarter our Q1 Pulse of Industrial Supply’s feedback, which, on the distributor side is predominately independent distributors, shared favorably with the major chains indicating that there is much business to go around (and if you want a free copy, email me.)
With Q2 coming to an end, we’re launching the Q2 Pulse of Industrial Supply survey. All input is confidential and respondents receive a free copy of the aggregated results.
The Q2 Pulse of Industrial Supply survey only takes 1-2 minutes to complete. Feedback will be shared with respondents at the end of the month. We need your input by Thursday, June 18th. Click here to participate.
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