Fastenal’s variety competition

An article in Bloombergbusinessweek (Feb 27, 2012) describes the greatest growth compan since 1987 as Fastenal, a distributor of fasteners. Fastenal’s 10,261 pages of fasteners provides the greatest variety of fasteners, available at 2,600 outlets.  Does variety provide a distributor with a competitive advantage in small margin, low cost but high variety items ? Given sourcing flexibility, would service be a barrier to entry for other distributors and enable it to charge a premium ?

About aviyer2010

Professor
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One Response to Fastenal’s variety competition

  1. My old job used Fastenal and McMaster-Carr for anything high variety. It is far more than just fasteners, but the main idea is low mean, high variance manufacturing parts.

    Their prices are not very good compared to bulk purchasing, but they win on fast delivery and availability. The more customers they have, the better they can control their inventories because of their bulk purchases.

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