For those of you not from around the Midwest, the Fastenal purchase of Manufacturers Supply, AKA MANSCO, was a very interesting move. I have called on MANSCO for years. It is a great company. This is not a Fastenal branch, this is a company that I would have expected a company like Wurth or Supply Tech or maybe AFC Industries to have acquired, not Fastenal. While MANSCO has some MRO business, I think of them as an innovative, VMI provider with strong technical abilities and the ability to sell specials. They are not just selling commodity items out in the mean fastener streets and fighting it out on price.
I do not mean to dismiss how far Fastenal has evolved from its early days of opening store front after storefront. Fastenal has many national accounts and is very good at VMI programs, and they have some very good OEM customers to prove it. And, they kind of brought the vending machine to the Fastener world. It’s just that they have not acquired other companies like MANSCO before, at least not to my knowledge. They often let those acquisitions go to other multi branch distributors. Fastenal stock is publicly traded and while I do not closely follow the stock I’m guessing they can get their hands on money when they need it. Is their intention to continue to pursue these types of distributors in the future?
There seems to be a race to identify any and all distributors who are privately owned and where there is not an obvious succession plan. Every week there seems to be another announcement. At some point, there will be large acquisitions with multi-branch distributors being gobbled up by other larger distributors or holding companies. But there is still plenty of low hanging fruit as the fastener industry still has a good amount of small and medium sized companies that were started by individuals. And now it certainly appears Fastenal is in that game.
Our industry has caught the attention of the likes Warren Buffet and Amazon and yet we continue to see new, small operations started up by former Fastenal employees or individuals who once sold for one of the companies that has hundreds of salespeople spread throughout the country. We are a funny industry.