Global Industrial Co., a billion-dollar distributor of industrial and maintenance, repair and operations (MRO) products and services, finished 2021 with record gross profit margins despite a fourth-quarter 4.3% drop in net sales. But Global Industrial notes that Q4 2021 had five fewer days than the year-earlier period, resulting in a 3.5% increase in average daily sales.
The company, where ecommerce orders accounted for 56% of total transactions last year, is following a multipronged strategy of improving supply chains and customer accounts as well as ongoing investment in digital commerce to increase profits even when recent pandemic-related market pressures hurt demand and sales, CEO Barry Litwin says.
“We are currently optimistic that supply chain challenges may normalize as we move through 2022,” Litwin said on the company’s fourth-quarter and year-end earnings call last week. “However, if they continue, we have shown and remain confident in our ability to manage through these challenges.”
The company is putting an increased emphasis on boosting its bottom line, he told analysts. “Profitability remains strong as we mitigated significant product and transportation cost inflation and leveraged pricing intelligence to deliver another quarterly gross margin record of 37%,” he said, according to a transcript from Seeking Alpha.
“For the second consecutive quarter, we achieved double-digit operating margins, the first time the company has achieved this level of profitability in back-to-back periods.”
For the full year ended Dec. 31, 2021, Global Industrial reported a 3.3% year-over-year increase in net sales to $1.063 billion; net income was $33.2 million, compared with $1.3 million a year earlier.
Going forward, the company is focusing on its ACE (accelerate the customer experience) program of ongoing improvement in how Global Industrial interacts with and serves its customers across industrial, commercial and public sector markets.
“As we move into 2022, our ACE focus is one of continued investment and execution that we believe will allow us to expand market share and capitalize on our growth opportunity,” Litwin says. “In our sales organization, we will be expanding our sales team with a key focus on public sector sales as well as launching a strategic account management team that’s focused on larger, more complex accounts.” Global Industrial says it has access to more than 100,000 public sector buyers through its group purchasing organizations.
“On the digital front, Global Industrial is committed to remaining a leader in digital transformation,” Litwin adds. “It’s our mission to offer our customers a modern, informative, and friction-free user experience across all digital channels. We are currently developing a new website platform with a completely updated user experience across desktop, tablet, and mobile. With additional features, personalization, a new look and feel, and navigation.”
To improve supply chain operations, Global Industrial launched in 2020 a vendor portal, where it shares information with suppliers on customer demand and other matters to help suppliers manage their production and fulfillment operations.
Litwin will address how to build a multifaceted strategy for multichannel growth as a keynoter on June 10 at EnvisionB2B in Chicago.
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