W.W. Grainger Inc.’s online-only Countless Assortment business has seen higher days, when annual sales increases ran in double-digit percentages. But the corporate expects a return to those increases and is well on its way on the outstanding distributor of maintenance, repair and operations products.
D.G. Macpherson, chairman and CEO, W.W. Grainger Inc.
D.G. Macpherson, chairman and CEO, said on an earnings call today that the Countless Assortment business — which offers online sales without the full-service approach Grainger provides through its High-Touch Solutions via sales teams and Grainger.com — nonetheless expanded its presence last yr with large in addition to small and midsized customers. He added that Zoro was also updating its product assortment to enhance what Grainger says had been an “unfavorable product mix” that led to a drop in Q4 gross profit margins.
W.W. Grainger Inc. is No. 11 within the Top 1000. The database is Digital Commerce 360’s rankings of the biggest online retailers in North America based on annual web sales.
Grainger online sales
“The Zoro team has progressed on their strategy, expanding their assortment, attracting latest customers and improving B2B customer retention,” he said.
Zoro’s Q4 sales rose 2.3% yr over yr to $264 million. MonotaRo’s Q4 sales increased 7.8% to $438 million. Combined Countless Assortment Q4 sales increased 6.0% to over $700 million.
Grainger’s total sales increased in Q4 by 5.1% to $3.997 billion and for the total yr by 8.2% to $16.5 billion.
Macpherson added that Zoro continued to deal with a technique of presenting a personalised product assortment, assessing price competitiveness, and “proactively communicating delivery times to focus on where we’re advantaged.”
Regarding Monotaro.com, Macpherson said “they appear stronger with enterprise customers [and] proceed to expand with small and midsize customers and are gaining operating leverage as they ramp into their distribution center in Davos.”
He added, “In January, I had the chance to go to MonotaRo and I used to be in a position to see that MonotaRo was supported by a good partnership between the U.S. supply chain organization and the Japanese counterparts.”
In Q4, Countless Assortment “growth was driven by B2B customers across the segment in addition to enterprise customer growth at MonotaRo, which was partially offset by declining sales to non-core, consumer-like customers at Zoro,” Grainger said.
Zoro added about 2 million SKUs in 2023, ending the yr with 13.1 million, an 18% increase. It also counted at yr’s end 5.17 billion registered users; MonotaRo counted 9.02 million.
Expanding DC space 35%
Grainger also announced today plans to open a 1.2-million-square-foot distribution center this spring within the Houston suburb of Hockley, Texas. Grainger says the brand new facility will house greater than 250,000 industrial supply items, starting from power tools to power transmission equipment, and employ about 400 people following its 2026 opening.
The Texas facility will follow the launch of two other distribution centers in Pineville, North Carolina, which is scheduled to open later this yr, and in Gresham, Oregon, scheduled for 2025. Overall, Grainger says it’s adding 3.5 million square feet of warehouse space, a companywide increase of 35%.
“These latest investments will strengthen our promise to customers who count on us to provide next-day complete orders to maintain their operations running,” Macpherson said on the earnings call.
Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. [email protected].
Percentage changes may not align exactly with dollar figures attributable to rounding. Check back for more earnings reports. Here’s last quarter’s W.W. Grainger report.
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