Grainger bucks convention, hikes inventory

Taking advantage of a weakened economy, the 75-year-old industrial supplier W. W. Grainger Inc. is increasing its inventories during 2002.

Grainger operates two stores in southwest Missouri. One is a 23,000-square-foot outlet at 808 N. Cedarbrook in Springfield; the other is a 5,000-square-foot store at 2919 E. Fourth St. in Joplin.

The company, which had $4.8 billion in sales in 2001, employs more than 15,000 people in almost 600 branches in all 50 states and worldwide. Its home office is in Lake Forest, Ill.

We're a "broad-line industrial distributor," said John Perkins, local branch manager for Grainger Industrial Supply. "In a nutshell, our product line would go from alkaline batteries to air compressors to toilet paper."

Size counts

"Typically, in times of recession, we are in a lot better position than our competitors because we have a very strong balance sheet," said Michael W. McGrew, external communications manager for Grainger. He said there are about 150,000 companies that operate in varying capacities and sizes in the same market Grainger does.

"At a time when a lot of our competitors are reducing inventory in order to cut costs we can really stack up. And right now we're in the process of adding approximately $100 million to our inventory nationwide," McGrew said.

The corporate philosophy behind this increase is poised preparedness to meet the industrial demand when the economy rebounds. The company wants "to make sure when our customers walk in, they walk out with something," McGrew said.

Boosting inventory levels should generate business "by default" because the product will be immediately available, Perkins said.

Southwest Missouri numbers

McGrew said most of the product being infused into Springfield's 26-year-old store has already arrived. The shared inventory value between the Springfield and Joplin stores is about $3 million. Combined the two outlets had sales of about $15 million for 2001, he added.

As part of its inventory increase, Grainger's Springfield store carries slightly more than 23,000 items, Perkins said. Joplin has about 4,000 items and is largely devoted to contractors' needs, he added.

The two stores cover about a 150-mile radius around Springfield and Joplin, Perkins said. He estimated that sales revenues divide at about 70 percent shipping and 30 percent walk-in for the two stores.

The company handles transportation and freight logistics in-house, using both local and national carriers for its less-than-truckload shipments, Perkins said.

Outfitting irregularities

Some of the more unique orders the company has filled have been bear repellent for people working on the Alaskan pipeline and orders for "jaws of life" equipment following the Sept. 11 tragedy, McGrew said.

Grainger is a Fortune 500 company and is traded as GWW on the New York Stock Exchange.

As of July 25, Granger was trading at $45.59 a share.

The company's web site is www. grainger.com