Fastenal Industrial Supplies
Fastenal was established as a small general mechanic shop in the 1960’s. The company was originally a hardware store which specialized in making all kinds of fasteners like nuts, bolts, washers, and other things. Their inventory was increased basing on the desires of the clients who said what they wanted, leading to many products. The company operations were expanded after sometime whereby they switched to importing and exporting. Currently, the company is distributing fasteners in all parts of the world using the large distribution network that has been established. The biggest strength of the company is their large distribution network and good services they offer to their customers.
Fastenal core competency is their ability to go the extra mile of focusing on their customer’s satisfaction for the reason that they want to keep their clients by guaranteeing exactly what is written on the label. At one point, in one of the audio clip, it is alleged that the industry only demands 10% accuracy in any box of fasteners, like nails. This implies that 901 is an okay fill in a box labeled as 1,000 nails. Fastenal demands that every box of product is 99.9% accurate. Fastenal do not only focus on people but they also protect their workers. Some people inquired about the new Automated System and whether or not its efficiency would take the work of some employees thus rendering them jobless. It was revealed that the company did not contract their workforce when the new changes were put in place
Most customers of the company are owners of hardware stores and warehouse locations in the region who are offered complete accuracy in their orders. Fastenal also ensures quick delivery times with the 99.9% accuracy mentioned above. The motto of the company is “Growth through Customer Service” and an incredible logistics team is required to make sure everything is delivered as ordered.
The company has expanded in many parts and now operates in all parts of America, Asia, and Europe with thousands of retail locations. The company allows for same-day delivery, extreme customizable orders, and easy order payments through their efficient system. The operations of the Fastenal are within construction, manufacturing, and retail which have all been automated.
One of the reasons the Automated System is so good for Fastenal is for the reason that it helps deliver on the strong promises made to customers. When orders are placed, the company is able to keep track the running of their trucks at any given moment, in that if a last-minute order is placed the company can redirect drivers in the field to handle the customer.
The Automated System is also of great benefit because it helps Fastenal run their extra storage space. One warehouse is 30,000 square feet, and the automated system is set up to maintain complete control over all inventories because every product needs to be tracked. The system also needs to update prices instantaneously, so that headquarters can keep track of every retail location with the push of a button.
The AS is very expensive ($23 million), thought it pays back due to its great benefits, for instance, the system helps to improve efficiency, slash customer complaints and is extremely good at logistical problem solving. My friend’s dad has a black belt in Six Sigma, and he untangles all problems that arise in his company’s distribution web. He scans hundreds of reports and generates graphs to explore different trends in orders. Every so often he is trying to cut price by combining two orders, other times he finds out it is financially worth it to cut a customer out.
Software like the automated system is awesome because it can be updated and can also track all important variables in shipping: fuel costs, total miles, employee costs, etc. It will help to bring prices down and put pressure on any competitors for the reason that their products cost less to make, store, and deliver.
The most impressive thing I found out about the company was that only one warehouse stored $9.5 million dollars’ worth of inventory, and the company does $4 billion worth of business every year. The impressive part is that the AS is supposed to keep track of it all, in every country around the world. The software helps in other ways, too, for instance it makes it easier to scan and keep track of inventory because the more than a million products makes it difficult to keep track. Barcode scans that are used allow for instant recognition and the computer keeps track of the number of inventory and logs it instantaneously in internal databases.
The faster the business works the more consumers like it because it reduces the chances of theft but also increases the risk of error. The system discourages employees from trying to skim product off the shelves. Fastenal’s system will improve management’s performance because they will be able to keep track of employees, provide better communication, and get everybody on the same page.
I enjoyed listening to Wise give his tours and stories for the reason that they were entertaining and informative. Fastenal was an interesting company, and I always like learning about places which focuses on the people.