Case in point: W.W.Grainger recently held a distribution center tour in New Jersey. Some comments were outlined by BB&T Capital Markets analyst Holden Lewis and his team in their weekly newsletter. (Get on their mail list for some great insight on industrial and commercial equipment markets as well as a select group of distributors they cover.)
Among the interesting insights in this report, which can be downloaded below:
- Grainger is benchmarking other distributors, some of which have 500,000 SKUs, to explore further product expansion. BB&T notes it is contributing 200-300 basis points to annual sales growth.
- Grainger's global sourcing is now 11 percent of sales and rising.
- E-commerce is now 24 percent of sales with potential for eventual 40 percent.
- Managed inventory programs (both vendor and customer) are small but growing.