MDM Premium
Need Help?
(888) 742-5060

In The News:

More From Mdm

How Manufacturers, Distributors View the Sharing of POS Data

 
MSC Industrial Takes Aim at $4B by 2016
Reprints
A A

In MSC Industrial Direct’s latest investor call to discuss its second quarter earnings, Erik Gershwind, president and COO, presented a framework in which the company will double in size to $4 billion in annual sales by 2016.

It’s a big step in achieving their current goal of becoming a $10 billion company. “We’re a growth-oriented company that gets excited by a big vision, but we move in increments,” Gershwind said.

To achieve $4 billion by 2016, MSC would have to attain a compound annual growth rate of 15 percent.

“It compares to historical CAGR during our life as a public company of roughly 14 percent,” Gershwind said. “And it also compares very favorably with industry growth.”

Gershwind was challenged on whether that goal was too low, based on the company’s history and improving market conditions. “Look, we’re an aggressive company, and you can imagine that since we are a performance-driven company, we set internal stretch targets for ourselves beyond what we share with you,” Gershwind said.

A majority of that growth is expected to be organic, with a focus on expanding programs including the company’s vending program.

Sales for the fiscal year second quarter ended Feb. 25, 2012, were $563 million, up 16.5 percent over the same period a year ago. The vending program, which is designed to aid customer management of inventories, currently contributes about 4 points to MSC’s growth rate, based on current customer volumes.

“Vending is exploding as a program, and it’s not just one customer,” Gershwind said.

The attraction to the program, according to CEO David Sandler, is its customizability and the technical expertise that MSC associates provide. “We’re winning because it’s not just about the machine,” Sandler said. “It’s the whole program that we bring to bear with the product and the technical expertise that really is unmatched.”

Copyright ©2014

Please do not reprint MDM's content on your website without MDM's express permission as it is copyrighted material. To gain permission, email us, or call 1-888-742-5060. For information on PDF or print reprints, visit www.mdm.com/reprints. MDM welcomes inbound links from your site. Please cite Modern Distribution Management.

Post a comment to this article

Partner Center