Fastenal Co., a big distributor of original equipment (OEM), maintenance, repair, and operations (MRO), construction, industrial, and safety products, posted strong digital sales in the third quarter.
For the third quarter ended Sept. 30, ecommerce sales—including transactions processed on the web and through EDI—totaled about $216.2 million, or 13.9% of total sales of $1.554 billion.
Dan Florness, CEO, Fastenal Co.
Web sales alone increased by 43% year over year, CEO Dan Florness said on a third-quarter earnings call with stock analysts.
“You combine Fastenal Managed Inventory (FMI) and ecommerce, our digital footprint is now 44% of sales—45% of sales, excuse me, and that’s where we ended the quarter in September,” he told analysts. “And that number nine months ago was in the 30s, so really pleased with that.”
Fastenal said it ended the third quarter with 90,493 installed “weighted FMI devices,” up 10% from the year-earlier quarter. FMI devices include internet-connected vending machines and bins that provide customers access to fasteners and other products at job locations.
“Looking at the FMI component, as well as the ecommerce component of that, we’re pushing the hardest on the FMI because we think a great supply chain partner doesn’t simplify the ordering process,” Florness told analysts. “They simplify the supply chain process and why
This year, Fastenal started calculating growth in FMI devices by using a “weighted FMI measure that combines the signings, installations and sales” of its vending machines and bins “into a standardized machine equivalent unit (MEU) based on the expected output of each device.” An MEU is valued at $2,000, which is the targeted monthly revenue for each FAST 500 vending machine. are you physically ordering repetitive items, and we believe that’s a unique place for us to be.”
For the third quarter, Fastenal also reported:
- Total sales grew by 10% year over year to $1.554 billion from $1.413 billion in the third quarter of 2020.
- Net earnings increased by 9.9% to $243.5 million in the third quarter from $221.5 million in Q3 2020.
For the 9 months ended Sept. 30, Fastenal reported:
- Total sales increased by 4.4 % year over year to $4.479 billion from $4.289 billion for the first nine months of 2020
- Net earnings increased by 4.7% to $693.8 million from $633.0 million.
“Daily sales through ecommerce grew 44.1% in the first nine months,” the company says.
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