Supply change: Andrew Davidson & Jozef Gallot

It’s common knowledge that factories across the world keep our lives running smoothly by providing us with the products that we rely on daily. But less thought is given to the services of industrial supply companies such as Fastenal – the backbone of manufacturing, without which modern industry could not function.

Regional Vice President Andrew Davidson and Director of Supply Chain – EMEA & APAC Jozef Gallot are key figures in the European operation of American industrial supply company Fastenal, and they are looking to extend its already growing impact across the industry.

"When I got to Europe in 2012, we had 10 locations," Gallot says. "We have over a hundred today and this growth has not involved any acquisitions. It was all organic growth."

"We really position ourselves as a supply chain partner providing supply chain solutions," Davidson adds. "When I look at Europe as a whole, the industrial market in many respects is slightly outdated in terms of how supply chains are managed."

According to Davidson, Fastenal’s holistic approach is the path forward.

"Instead of just focusing on the cost of every single product bought into a factory, we’re taking an all-encompassing look at how we eliminate all costs from the product and everything around the supply chain," he says.

"That means reducing inventory levels, inefficiencies and waste from within the production environment and reducing the total cost of ownership for manufacturing companies. There’s a lot of opportunity on the table."

Innovation, tech and data

As Davidson explains, Fastenal’s focus on innovation is helping companies avoid the trend of regional stagnation he’s observing.

"We’re not seeing enough innovation come out of Europe. It seems that it’s coming out of the United States and China to a large degree now, while Europe is kind of at a standstill," he notes.

As well as focusing on software innovation and using AI to help consolidate greater savings across its entire operation, Fastenal’s point-of-use supply solutions are providing an impact for its partners across Europe and the world.

"We are deploying physical hardware into our customers’ facilities to help manage their inventory more appropriately," Davidson explains.

"Our industrial vending program puts consumables used within manufacturing facilities and thus under control. So if a worker needs some personal protective equipment or they need certain tools to do their job, they can go and dispense that right at the point of use.

"In addition to providing controlled point-of-use access, the devices feed reporting and analytics tools to help Fastenal and its customers optimize supply chain decision-making."

Davidson estimates that there are more than 100,000 of these vending machines globally.

"That piece of hardware means that the right worker gets the right products at the right time. They don’t need to go around the factory looking for it; it’ll be at the right place at the right time," he says.

"No-one from the company has to undertake any administration or ordering; Fastenal does all of the fulfillment of these machines."

Core culture

Both Davidson and Gallot’s impressive career trajectories are reflective of Fastenal’s unique cultural approach, which includes a focus on developing and promoting leaders from within the organization.

"Every market we enter into geographically, we open up organically, we put all of our own people into it and we promote from within," Davidson explains.

Gallot was still in his 20s when he was entrusted to run a department on the other side of the Atlantic.

"What other company will give a 27-year-old the opportunity to go to Europe and lead a portion of the business?" Gallot says. "It’s unheard of."

"The vast majority of our leaders across the company all started at entry-level roles. So that means we need to be very disciplined about the development of our staff," Davidson continues.

"We’re expanding a lot more of our development plans this year. We have a Fastenal school of business where we do classes virtually, but we’re also putting a lot more emphasis on more structured mentoring to elevate all of our staff members to be executing at a level higher than where they’re at today."

Davidson credits this cultural approach as stemming from Founder Robert ‘Bob’ Kierlin and recognizes it as a key pillar of the company’s prolonged success.

"Bob’s whole philosophy was a belief in people. So we’re a very decentralized business. We extend a lot of ownership to our people in the field, and we allow people to make decisions," he says.

"We’re a very unique organization. If you love it here, you’re probably going to be around for at least a decade," Gallot adds. "Our retention rate has been exceptionally high in Europe over the past five years, north of 94 percent."

Value-driven relationships

As Director of Supply Chain, Gallot leads Fastenal’s efforts not only in Europe but also across Asia.

"It’s a very holistic approach that we take," he says. "Our strategic sellers will go out and they’ll solicit business; they look for customers that we can provide value for. Certainly, we’ve become more mature now that we have great partnerships with a few hundred suppliers."

Among its fleet of trusted suppliers is PIP Global Safety.

"We invest in technology, obviously, but we also invest in local branches to service our customers with local Fastenal labor. That’s what makes us really special," Gallot points out.

Davidson adds that what makes Fastenal truly special are its four core values – ambition, innovation, integrity and teamwork – which he and Gallot are carrying forward into the future.

"We hire from the ground up, so our leaders understand everything about the culture of the company; they understand all about the operations and the nuances," he says.

"They’re leading new employees through the same pathway, so there’s very little risk to losing our core values.

"I believe that a lot of the success we’ve seen in recent years has been driven by our culture."