Digital commerce is vital to distributor Global Industrial Co.’s sales and getting more so, CEO Barry Litwin said Tuesday.

Barry Litwin, CEO, Global Industrial Co.

Global Industrial sales for the second quarter ended June 30 increased 16.8% year over year to a record $318.5 million. Global Industrial does more than half of its customer transactions through digital commerce.

Litwin, speaking to investment analysts on an earnings call, attributed the quarter’s financial performance to “key digital sales, marketing, and distribution initiatives. We believe these investments will strengthen our competitive position and help us drive growth and capture additional market share in the highly fragmented industrial distribution space.”

Global Industrial sells more than 1 million SKUs of maintenance, repair and operations (MRO) products. That includes its own private label products and equipment branded by Caterpillar, that companies use to operate their facilities.

A new ecommerce platform

“We continue to make progress on key digital innovation, sales, marketing, customer, and logistics initiatives, highlighted by the initial phased rollout of our new ecommerce platform, which includes an enhanced user experience for desktop and mobile customers,” Litwin said. “We believe investments in these areas will strengthen our competitive position, help us drive growth, and allow us to capture additional market share in the highly fragmented industrial distribution marketplace.”

Litwin noted that Global Industrial recently launched a new digital ecommerce platform. It’s designed with an improved user experience. That includes “easier mobile navigation, personalized recommendations, auto reorder functionality, faster checkout, and the addition of Knowledge Center content to product category pages.” The company’s Knowledge Center provides customers with educational materials including product videos.

“It’s our mission to offer our customers a modern, informative, and friction-free user experience across all digital channels,” Litwin said in an interview earlier this year.

Litwin discussed Global Industrial sales, ecommerce and overall growth strategies in a keynote “fireside chat” at the EnvisionB2B Conference & Exhibition in June.

For the second quarter ended June 30, Global Industrial reported:

• Net income increased 3.6% year over year to $22.8 million.
• Gross profit increased 15.3% to $113.0 million, resulting in a gross margin of 35.5%, down from 36.0%.

Litwin attributed the margin drop to freight and fuel surcharges, promotional activity and flow through of higher-cost inventory. But he added that he noticed some ocean freight costs started to decline. He said he noticed that supply chains were showing increased product availability, which could lead to lower costs from suppliers.

For the first half, the company reported:

• Total sales increased 15.9% year over year to $607.1 million.
• Net income rose 20.4% to $44.8 million.
• Gross profit increased 26% to $220.8 million, resulting in a gross margin of 36.4%, up from 33.5%.

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