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Fastenal Co. Buys Stake in Apex — Its Provider of Industrial Vending Machines

April 16, 2020
Industrial vending machines remain a core selling tool for Fastenal.

Fastenal Co., Winona, MN, purchased certain assets of Apex Industrial Technologies on March 30, according to an 8K filed by the company.

Over the past 12 years, Apex has provided Fastenal with thousands of industrial vending machines, and the distributor is generally considered to be the leader in the use of this on-site sales tool at industrial and commercial locations. According to the 8K, since 2008, Fastenal bought “more than 105,000 product dispensing and leased devices across 23 device types in 25 countries. These devices generated more than $1.1 billion in sales in 2019.”

Fastenal’s installed base of industrial vending machines has always been a bit mind-blowing, but according to the latest available financial information on its website, it has aggressive goals to install even more vending machines. Before the COVID-19 crisis, Fastenal set a goal of signing on 22,000 to 24,000 vending machines.

However, the downturn in business has had an impact. “We signed 4,798 industrial vending devices during the first quarter of 2020,” the company said in its 1Q 2020 earnings report. “Our installed device count on March 31, was 92,124, an increase of 10.4% over March 31, 2019,” “Daily sales through our vending devices grew at a low double-digit pace in the first quarter of 2020 over the first quarter of 2019 due to the increase in the installed base. These device counts do not include slightly more than 15,000 vending devices deployed as part of our lease locker program.

“With business activity slowing further, many customers closed and operating below capacity, and our own efforts to source critical parts for customers diverting energy from growth driver signings, visibility for signings has become limited.

 Fastenal said in its 8K that Apex created and developed the software, designed the equipment, and built the vending equipment supply chain, while it brought industry expertise, presence in the marketplace and a willingness to bring the platform to market.

 Fastenal’s President and Chief Executive Officer, Dan Florness, said in the 8K, “Fastenal’s founder, Bob Kierlin, conceived of industrial vending at the company’s inception in 1967. Our relationship with Apex Industrial Technologies in 2008 helped to make the industrial vending solution scalable. This transaction allows both organizations to move forward with their unique strategic plans while still providing an avenue for additional collaboration.

 “In connection with this transaction, Fastenal purchased a perpetual and unfettered use of key patents, designs, software and licenses, as well as direct access to the supply chain.”