W.W. Grainger Inc. now draws more than half of its revenue from e-commerce. The supplier of maintenance, repair and operating products today reported overall growth of almost 3% for fiscal 2017. And 56% of total revenue—$5.84 billion—came in through its e-commerce channels, including websites, EDI, its KeepStock managed inventory service and vending machines, and e-procurement systems, a spokesman says.
The company’s Other Businesses segment, which includes its Zoro.com and Japan-based MonotaRO.com B2B e-commerce sites, grew 12.5%, to $2.12 billion, for the year and 16%, to $559.4 million, in the fourth quarter. Grainger CEO D.G. Macpherson attributed most of that Q4 growth to higher sales volume, in today’s earnings call with analysts. Sales growth was primarily driven by MonotaRO.com in Japan, which offers industrial products, and Zoro.com in the United States, which offers off-price products, he said.
Grainger plans to expand online initiatives in 2018, Macpherson told analysts. Its Gamut.com e-commerce site, launched in June to provide quick access to products in a Spartan format dominated by basic product descriptions and groupings, will be combined with the flagship Grainger.com site, he said. And thanks in part to new tax reforms, Grainger will invest 0.2% of its capital in its “digital platform,” Macpherson said. He declined to offer specifics. Grainger’s stock market capitalization is $15.5 billion, and 0.2% of that would be more than $30 million.
In launching Gamut.com in June 2017, Grainger said it was designed with “a proprietary information system that manages and organizes a comprehensive list of product attributes, application-specific imagery and rich, technical data. This enables the website to generate relevant, curated search results that help customers quickly find and purchase the right products.”
For the fiscal year ended Dec. 31, Grainger, No. 32 in the 2018 B2B E-Commerce 300, reported:
- Net sales of $10.42 billion, up 2.8% from $10.14 billion a year earlier.
- Gross profit of $4.097 billion, down 0.4% from $4.114 billion.
- Net earnings of $585.7 million, down 3.3% from $605.9 million.
For the fourth quarter ended Dec. 31, Grainger reported:
- Net sales of $2.632 billion, up 6.6% from $2.470 billion a year earlier.
- Gross profit of $1.021 billion, up 3.2% from $989.69 million.
- Net earnings of $151.1 million, up 149.0% from $60.7 million. Most of the earnings jump came from increased U.S. sales volume and reduced expenses, Macpherson said.
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