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HUB-Supply Chain Supply Chain Case Studies

Fastenal’s 2020 Vision Balances Growth Drivers with its Core Values and Culture

As a B2B supply chain solutions company, Fastenal serves as a consultant, logistics company and technology provider.

“How do we create a world-class supply chain?” This was the challenge from Fastenal’s leadership to the supply chain team. Their response has been a blend of tradition and technology.

Start with Fastenal’s core values of innovation, teamwork, ambition, and integrity. Add the agility afforded by the company’s decentralized culture. Mix in an ability to adapt to new ideas and technology to be sustainable in the current market. Sprinkle some heavy collaboration across departments — and with that, they’ve found a recipe for success.

The Right Product, at the Right Time

The Winona, Minnesota-based company was founded in 1967, at which point it was the smallest of an estimated 10,000 fastener distributors in North America. By the mid-1990s, it had become the largest, almost entirely through organic growth, and has since moved beyond fasteners to support a broad range of industrial and construction supplies spanning 30 product lines.  

But products are just part of the picture. As a B2B supply chain solutions company, Fastenal serves as a consultant (with teams of experts in areas like safety, engineering, and lean Six Sigma), a logistics company (with a captive distribution and transportation system), and as a technology provider (with a suite of e-business and automated supply solutions, including well over 100,000 industrial vending devices currently operating at customer sites).

“Fastenal is not just a supplier, but truly a part of our customers’ supply chains,” said Melissa Puchalla, Fastenal’s director of supply chain compliance. “We’ve built a decentralized system that does a really good job at forecasting demand and responding quickly to fast-changing customer needs across a variety of markets and industries.”

The key, according to Puchalla, is the company’s network of 3,200 stocking and service locations, each providing custom in-market inventory and a dedicated service team to support local customers. The result is an extremely short, agile supply chain for the customer.

“We strive to be fluid to react to what our customers’ needs are,” says Fastenal’s director of supply chain, Wendy Suchla. “The end-goal is making sure we have the right product, in the right place, at the right time. Local engagement is what makes that happen.”

Accurate supply chain data plays a pivotal role in the process, providing local Fastenal personnel and customers with the information they need to make millions of sourcing, inventory, logistics, and purchasing decisions every day.

Streamlining Through Data Collection

“We are distributors, so a key challenge is gathering accurate data from our vendors and streamlining that to get the right product to the consumer,” Melissa Puchalla explains. “From product information to inventory levels, data fuels the supply chain.”

Fastenal continues to enhance its product information management system, which includes both product and vendor data. Information management is crucial as the company brings vendors on board to keep pace with customer demands around the world. Acquiring data frequently from its suppliers allows Fastenal to better manage inventory and ultimately provide better service in the field.

“We have internal goals and customer expectations to meet, so the better the data is on the front end, the more efficient we are as a supply chain partner to our customers,” Suchla says.

What Was Learned?

The elements of a world-class supply chain are data, market intelligence, and inventory strategies. Maintaining a culture of decentralized decision-making, while understanding and gaining efficiencies where needed, has proven to be a powerful combination.

Fastenal’s growth drivers have expanded to include not only public branches but also point-of-use vending solutions and onsite locations within customer sites. Looking to 2020 and beyond, Fastenal’s supply chain team will continue to enhance systems and processes to support personnel and customers with an even more “local” supply chain, both in terms of physical proximity and strategic alignment.  

“We’re fortunate to have a great culture and business model to build on,” Suchla adds. “It’s rewarding to evolve our supply chain so that it’s increasingly attuned to strategic customers’ needs.”


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