A big distributor hits a digital milestone

A major US distributor of industrial supplies ended 2022 with a bevy of digital firsts. Fastenal Co. also is planning more aggressive benchmarks for its digital sales channel.

The company generates digital sales through multiple channels including internet vending machines, ecommerce and electronic data interchange. Fastenal is almost to the day when electronic sales account for nearly half of all revenue.

“2022 was a year of milestones,” the company says. “Our ecommerce revenues surpassed $1 billion of sales, our international sales exceeded $1 billion and our company-wide net earnings topped $1 billion.”

Overall for the year ended Dec. 31, 2022, Fastenal reported an increase in sales to $6.980 billion. That’s up 16% from $6.010 billion in 2021. Meanwhile, net sales were $1.07 billion, compared with $925.1 million in 2021. Based on $1 billion in ecommerce sales, Digital Commerce 360 projects that ecommerce accounted for about 14% of all sales.

“Since 2015, we have seen a steady reduction in our traditional branches, primarily within the United States,” the company says. “Our focus on on-sites, shifting branch priorities, and the supply chain tools comprising our digital footprint have provided opportunities for network consolidation.” Fastenal now operates 1,683 branches in North America, a 2% decline from the previous year.

• Total sales of $1.695 billion, up 10.7% from $1.531 billion in Q4 2021.
• Net earnings were $245.6 million, up from $231.2 million in the prior-year period.
• Daily ecommerce sales grew 48.2% and represented 20.1% ($340.7 million) of total Fastenal revenue.

“We anticipate we will hit 65% of our sales running through our digital footprint in 2023,” Fastenal says.