Fastco Case Analysis

1505 Words 6 Pages
One of the ways to handle it is internally; even though this is an option the cost usually prohibits companies from utilizing this method. Also a company can work with a brokerage firm; this is a good method to help with service and quality assurance. There is also the option to partner with a trading company which is usually what happens. The reason this is the most popular method is because it is the cheapest and easier to partner with a company who will take full responsibility for quality, delivering, competitive pricing, and is already established. Fastenal decided to partner with an already developed trading company so they did not have to take on the extensive cost of creating a whole new company. Fastenal was not the only ones to benefit …show more content…
Even though Fastenal has been sourcing products from Asia since 1989 the creation of Fastco was a big move for the company. According to Fastener-world magazine, “Industrial and construction supplies make up 42% of total sales” (fastener-world, 2014). Since the industrial and construction supply sales make up such a large part of the company sales it made sense to offer a sourcing option for their customers. This move helped make the cost cheaper for the customers who wanted to source their supplies. FASTCO now brings 20 years of experience to Fastenal’s customer base while still having the local service of the over 2,600 Fastenal stores. Even though FASTCO was established to make things easier for the customer, sometimes things do not go as …show more content…
Since the product was late the company involved must have lost thousands of dollars since they had to close an assembly line because of 2,000 bolts. This goes to show how logistics can ruin a company, even though the situation was handled a company lost a lot of money because of shipping time. This is one of the major draw backs of having FASTCO in china. If a customer needs their parts right away they will have to over pay for us to make them here and ship from here. Having this kind of logistic nightmare is what can flaw a production

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