Fastenal Industry Situation Analysis - 15765 Words

1. INDUSTRY SITUATION ANALYSIS 1.1 Dominant Economic Characteristics of the Industry Environment †¢ Market size: The Industrial Distribution industry was estimated to be $400 billion in 2001, but the industry has many sub-industries within it (16). To name a few, Home Improvement revenues were $73 billion in 2003, $5.1 billion for the Building Materials Wholesale industry, $61 billion for the Electronic Wholesale industry, $10.4 billion for the Industrial Equipment Wholesale industry, and $211 billion for the Basic Materials Wholesale Industry (14). †¢ Scope of competitive rivalry: All of the top ten companies in the industry have a national impact with their companies, although some have expanded into small international ventures in†¦show more content†¦To the buyers, there is little difference in the products except for things like price or guarantees, etc. †¢ Scale economies: Large distributors have a better advantage negotiating with suppliers because they buy thousands of products in bulk. Market leaders have a huge competitive advantage because they get better prices; it is easier for scale of economies can be realized through acquisitions and mergers for larger companies because of their resource and financial strength. †¢ Learning and experiencing effects: Learning and experience effects are not a huge factor for products, but they are very important for service and e-commerce. Being able to keep up with and invent new and better services for customer is key o sustaining a competitive advantage. With e-commerce being so recent and innovative, learning and experience effects with internet operations are to be expected and anticipated. Companies within the industry must continually stay on top of shifting customer needs and concerns in order to continue growing and retaining its customer base. †¢ Capacity utilization: Capacity utilization is on of the factors that the level of activity in the industrial construction market depends on (3). The capacity utilization for the construction industry, machinery, and other related industries related to industrial distribution range between 80 and 90 percent, with an overall average of 82.9% (2). There is a common belief by economists when utilization rises aboveShow MoreRelatedBaby Rampers3956 Words   |  16 Pageschildren who don’t get much time from their parents. All through this report/analysis we will be discussing the whole concept of Baby Rompers. We will analyze and explore the market, the customer, our service type, its strengths and weaknesses, its probable competitors and last but not least, our goals and objectives. The Situation analyses (e.g. SWOT analysis, competition and market share analysis and the Macro factor analysis), Objectives, Strategies, Action Program, Financial projection, the Implementat ionRead MoreInvestment and Economic Moats46074 Words   |  185 Pagesany implied warranties of merchantability or ï ¬ tness for a particular purpose. No warranty may be created or extended by sales representatives or written sales materials. The advice and strategies contained herein may not be suitable for your situation. You should consult with a professional where appropriate. Neither the publisher nor author shall be liable for any loss of proï ¬ t or any other commercial damages, including but not limited to special, incidental, consequential, or other damagesRead MoreValue Line Publishing, October 200213010 Words   |  53 PagesValuation and Analysis of Home Depot Inc. Gracie Quintana Jeff Miller Christine Kyrish Steven Poon December 6, 2004 1 Table of Contents Financial Data Snapshot I. Overview of Valuation II. Business Summary Products and Services Competitors Industry Analysis Competitive Strategy III. Accounting Analysis Accounting Policies Degree of Accounting Flexibility Accounting Strategy Quality of Disclosure Quantitative Analysis Red Flags IV. Ratio Analysis and Forecasts Ratio Analysis Section Financial