... session here with MSC Industrial. I'm Chirag Patel. I cover the machinery, multis, and distribution space here at Jefferies, along with Steve Volkmann. It's our pleasure to have Erik Gershwind, the CEO of MSC Industrial, and then Ryan Mills, head of Investor Relations. I was gonna actually start out with a quick little overview of the company and the business, and then let's jump right into the meat of it.
That sounds great. Thank you for having us, Chirag.
Just a brief overview of the business trends that you're seeing currently, the dynamics that you've kind of laid out in your latest earnings call, that are kind of important to be mindful of at this point.
Yeah, sure, and, so thank you again for hosting us. Chirag, as a reminder, we reported our-
fiscal .
So yeah, maybe a clarification if anybody is new to the story. We're on a fiscal calendar that runs September to August, so we are in day two of our fiscal '26, off to a rocking start here. We gave an update on our third quarter results on July 1st, so our third quarter would've been. I gotta get myself reoriented. March, April, May, and I would describe it as. So we sell, and a little backdrop on the company, industrial distributor selling over two million SKUs, primarily into heavy industry and manufacturing end markets in particular, so about 70%, nearly virtually all of the company's sales are North American.
70% of our sales, plus or minus, are into the manufacturing sector, which has been soft, and our end markets in particular, soft for the last 18-24 months. We did highlight that in our fiscal third quarter, we started to see some sequential improvement. So we were a little under flat, which by no means is anything to write home about, but I think we're starting to see a little bit of sequential improvement. And I think, which I'm sure we'll get into, but most notably, the most encouraging part was there's three customer types that we talk about publicly. Our core customer, which is around mostly made up of small and medium-sized businesses, which is around half of the company's sales.
The second customer type is our national accounts customer base, and third being public sector, which is around 10% of company sales. So I think most notable about our third quarter was seeing the most sequential improvement in our core customer base, which is heavily levered to manufacturing, even more heavily levered to metal-cutting manufacturing, which is kind of the roots and the bread and butter of MSC. It's been a customer base where we've underperformed for a number of years and have put a full court press on revitalizing, or as we call the re-energizing that base, started to see some sequential improvement. Since that point, and then I'll stop, Chirag, but we did share. You mentioned July, so June, July, we did share.
Our fiscal, because we're on a fiscal calendar, our June is a five-week month and actually ran through the July 4th week. So when we had reported our third quarter results, we gave an estimate for June. We were still in the midst of that last week that had June at about flat, which was continuing this slight progression. We ended up actually coming in considerably stronger that final week than we were expecting. So June ended up coming in at positive 2.5% growth, and the color we added was that July, which at the time, and we haven't shared anything since, was that July wasn't finished, that we were remaining in positive growth territory. That was how we put it. So I would say, you know, the environment is certainly not exactly booming. Customers are cautious.
It's a little bit uncertain still, but we are starting to see a little bit of positive trending there.
That positive trend that you saw through the June-July time period, is that still primarily based on, the core customers, that dynamic, or, or are we seeing a little bit more on the national account side?
So we didn't put color on the breakout, and we will come October. But I think the core customer I mentioned, we've got our eyes on that because it is 50% of the company's revenues. It is the highest margin part of the business, where we have underperformed. We've had several programs that have been in flight for a while now, aimed at re-energizing it. So it's definitely where we have our eyes on, and, you know, we'll give more color, but between tariffs, which I'm sure we'll get to, and pricing, along with core customer.
You brought it up.
I brought it up. You know, we feel like both of those are encouraging signs as we now look into 2026 and prospects.
And I guess the other thing I was looking at was the idea of the pricing dynamic. You know, in distribution, there's definitely a nice little favorable pricing trend historically. What are you kinda seeing right now in just underlying pricing? And then, what are you taking as far as actions on the tariff side of the equation? And remind me, I don't think you quantified the number, or maybe you did, and I missed it already, but-
So, part yes, part no. What we did, so our fiscal second quarter, so third quarter was July 1st. Our fiscal second quarter, we reported the morning-
Right
... pre-market after Liberation Day was post-market. And I think if I track back to that moment in time, which was just impeccable timing, out of the gate, I would say pricing had been slower to come by, meaning price increases, slower to come by than we were expecting. And just to be clear, out of our revenue base, roughly three-quarters of our business is we are not the importer of record, where we're selling an industry brand for resale as a distributor, and then there's a quarter where we're direct sourcing, and some of that quarter we're direct sourcing domestically here in the United States, and then somewhere we would be an importer of record. When I say pricing was slower going out of the gates, we saw...
In a normal inflation cycle, when there's an impetus like this, we would see our branded manufacturers move pretty quickly and pretty aggressively on price increases. Because of the way things have played out with all the to-ing and fro-ing, most of the manufacturing base was reluctant to move out of the gate. So this is going back to the April timeframe. So what we had done, at the time, was we did move in a targeted way on products where we were the direct importer of record and seeing a tariff increase. We reported on July 1st that we, for the first time, moved in a broader way-
Mm-hmm
... outside of that, where we did start to see manufacturers move on their list price increases. We described it as a low single digit, the color that we put on the increase. You know, I would say since that time, there certainly has been probably more of a firming up and a building momentum around supply, our supply base, putting pricing through. So, you know, as we look ahead, we normally try to be very selective in how often we go to market with price increases.
Mm-hmm.
Just we have a cadence with our customers. I would say this is not normal times though, so, you know, certainly, if conditions warrant and continue, we would consider moving again during the calendar year and early in our fiscal 2026, if warranted.
you know, pricing is one aspect of it. There's always the fear on the opposite side of demand destruction kind of associated with that. Are you seeing anything on that front at this point?
You know, so far, I would describe, and I'll go back to the comments we shared in July: the environment, cautious but stable.
Mm-hmm.
So it's not like things have dropped off a cliff. It's not like things have really inflected in terms of the environment. Cautious but stable is what I would describe. You know, I would say most of our customers are understanding. Everyone sees the headlines and reads the news. They understand that where tariffs are in play, prices will go up.
Mm-hmm.
I think the trick for us, and it's been received, I wouldn't say favorably, 'cause no one likes pricing, but unempathetically, is that, number one is, you know, we're trying to be transparent, and to focus pricing on where there's tariffs and not make it broad-based-
Mm-hmm
... which keeps our credibility high with our customers. The second thing is the conversation with the customer immediately turns to: "What are you, as a distributor, gonna do to help me offset the inflation? Where are you gonna help me find productivity?", and that actually plays into MSC's strengths pretty well, because, you know, One of the things we anchor ourselves in is being able to go and work with our customers on their plant floor to help them find productivity improvement. So that's been part of the discussion every time, and I think that's why it's been reasonably well-received. So to get back to your question about demand destruction, I would say we would characterize the environment as stable. So no major demand destruction to do-
Okay
... of note.
Very good, and I guess I wanted to kind of touch into the market environment and the end market dynamics that you're seeing, specifically starting with the heavy manufacturing side of the equation. What's kind of the expectation? What are you seeing currently play out in that? We're at the bottom of an ag cycle, seems to be a little improvement in construction side of the equation. What are you guys seeing?
Yeah, and I'll preface it by giving you the perch we sit on, which is, I mentioned, 70% manufacturing. As you said, Chirag, most of that's heavy manufacturing, and there's five top end markets that are the bulk of the manufacturing for us, which is machinery and equipment, which would capture ag as part of that, primary metals, fabricated metals, which would be where machine shops and job shops would play, automotive, and aerospace. If I look at the last 18, nearly 24 months, it's been a slog in heavy manufacturing, with the notable exception of aerospace.
Okay.
I would say, of late. You know, and just a proof point, one of the indicators that we track that's been remarkably correlated to MSC performance over time, has been something called the MBI or the Metalworking Business Index. So for those familiar with the PMI survey that's administered by ISM, it's a sentiment survey, 50 being neutral, greater than 50, growth, and less contraction. It's very much fashioned along those lines, but geared towards metal, the metalworking end markets. That reading had been negative for, I wanna say, 24, Ryan? Twenty-four, 25 straight months.
Yeah, it's been, yeah, with the exception of-
One-
... March
... one month, and you know, we looked back over the course of as long as that survey's been administered, decades, we've never seen that before. I would say... You know, I mentioned cautious but stable right now. There's probably, from our view, more upside than there is downside from where we sit right now. It's just been most of the end markets depressed for a while. We certainly think that once we do get through tariff noise, that a lot of the administration's push to bring manufacturing back to the United States will be good for the economy, good for us.
Mm-hmm.
Some of the tax work that could stimulate reinvestment and, you know, interest rates, the outlook is probably, as I said, more upside than downside in the next 12 to 18 months.
So we are kind of waiting on the uncertain macro for customers to kind of unlock a little bit of the opportunity as we go forward, then?
I think so. I think, and we'll get to it, Chirag, from our standpoint. So I think that's right in the macro. We do feel like there's a real self-help story at MSC, both on the revenue and the operating margin line, whereby we don't feel like we should need to see a really robust macro in order to drive growth.
Okay.
That if we get just some stability, based on some of the things we have going on, you know, we would expect to grow.
Gotcha. And we're talking about a stable, kind of a quarter over quarter kind of client base or customer base currently. Is there any sort of inventory issues that you're worried about from the customer standpoint at this point, or...?
We think that, you know, we gauge this all the time with our customers, that for the most part, inventory levels are appropriately sized from what we can tell, and that customers are ordering as they need it. So I would say it doesn't feel like, again, there's not a lot of downside in terms of destocking. If there were to be an inflection, usually there'd be a build in inventory that we could benefit from if that were to happen. So I would say again, probably sized right, with more upside than downside if there's improvement.
Very good. And then we touched a little bit on the end markets, but one of the big things is the strategic efforts that you guys are making internally on the digital side of the transformation. I kinda wanna touch on that first, and then talk through some of the other changes that are happening at the business level.
Yeah, sure, so I think probably the biggest headline here, I mentioned the Core Customer, and re-energizing growth in the Core Customer, which not only hits the revenue line, but would generate leverage and improve the margin profile for sure. We've had, you know, there's four initiatives that we've had in flight for the past two fiscal years that are pretty much behind us now, which means that we're at the point where we would expect to be able to begin to harvest benefits, so the first was realigning our public-facing web pricing. That was completed last fiscal year, and there's still fine-tuning being done, but for the most part, that would be behind us. The second being upgrading our e-commerce experience and web platform, which was a while in the making.
The new platform is pretty much live as of the end of our fiscal second quarter. The third initiative being accelerating and enhancing our marketing program-
Mm-hmm
... using some technology, which that is now in flight, and the fourth being optimizing seller coverage, which also has been done over the past, year or so. So we feel like most of the ingredients are there. It's always difficult to time out. You know, some of these things, like when we install some of our high-touch programs, we install a vending machine, we put an In-Plant
Mm
... that have us encouraged, and I'm happy to, you know, touch on any of those four.
Yeah, and actually, I do wanna kind of delve in a little bit deeper into those.
Mm.
But one of the things I wanna look on the overarching side is that, you know, those actions that you've taken, what's kind of the expectation for how that should translate to market share gain as you kind of look through that?
So the biggest proof point, I think, for the public world is going to be, there's gonna be our overall growth. If we expect to grow, and historically have, at 400 basis points above the industrial production index. Now, that's inclusive of volume and price, but that would be overall. More specifically, I mentioned the core customer, restoring that segment to growth, you know, in a stable environment, so call it a flat IP environment, I think will be a good marker.
Mm
... as to progress. And then, you know, obviously we're measuring carefully, particularly our e-commerce upgrade and our marketing efforts. We have several KPIs for each of those two programs that we're tracking carefully to say, "Are they doing what they're supposed to be doing? Are we seeing traction that should lead to improvement in the core customer?
Got you. What's a good way to kind of track and get a sense for the impact that your enhanced website and e-commerce platform is getting us?
So there'll be a couple of ways that you'll be able to easily see. One is gonna be the core customer growth, which we report on quarterly. So we gave the color in our fiscal third quarter, that again, I mean, getting close to flat is nothing to write home about, but we did see from Q2 to Q3, the core customer sequentially, in average daily sales, grew. It was the fastest grower in our business, and that was the first quarter in which the new web platform was in market.
Mm-hmm.
So that was encouraging. We also publicly, we produce, we publish our e-commerce revenues. So you could see our total revenues and revenues as a percentage of sales.
Mm-hmm.
That's gonna be another metric we track, and then we'll share on an ongoing basis some of the KPIs we look at on both initiatives. We gave a few proof points on our last earnings call, so for instance, with respect to the website, we're looking at what percentage of the traffic that comes to the website is converting to find what they're looking for and ultimately place a purchase, and are we seeing those conversion rates go up? We saw some early encouraging indicators, yes. On our marketing programs, we're looking, you know, under the covers at return on ad spend, at conversion rates and effectiveness, and, you know, again, we saw some early proof points, but I think ultimately what you'll be able to see publicly is core customer growth rate and digital growth.
Okay. Are you seeing an increase in the wallet share that you're gaining through the e-commerce platform from a customer? Or, you know, is the enhanced website finding you the extra dollar as well?
So there's the formula on the web, and what I would say is we only have publicly one quarter under our belt, so it was early. But there's basically three metrics in its most simplest form, three things we're tracking. Number one is, how much volume are we getting to the site? Which is really a marketing effectiveness question. How much volume is coming at what cost? Two is, how is that volume translating into orders, which is conversion rate, and the third is our average order size. Are we seeing an increase in the average order size? And what we noted was that we saw some early signs in terms of improvements on conversion rate and average order size.
Mm-hmm.
So, you know, again, early indicators, one quarter, but some encouraging signs, yes.
Moving from that, I wanted to talk a little bit about the vending and in-plant opportunities. Roughly about 18%, a little under 20% of the total sales at this point. One, how large can that business be for you as you go through it? What's the advantage of having that kind of a part of the platform?
Yeah, okay, so this is actually the flip side of the core customer-
Right
... story, where the company over the last decade has put a heavy focus on becoming what we refer to as mission critical to our customers, which means going beyond just selling product, shipping it to our customer's loading dock, and stopping. But we've put a heavy emphasis on expanding the role that MSC plays inside of our customers, and particularly our larger customers that value total cost of ownership, that want a more integrated relationship, where MSC is actually reaching inside of the customer's plant floor. So if you go to MSC customers today, you'll find an MSC VMI, or Vendor Managed Inventory program, managing inventory.
You'll see MSC industrial-grade vending machines, and in some cases, as you mentioned, you'll see MSC people full-time in our customers', playing a role, anything from procurement, to put away, to kitting, to really being an extra set of eyes and ears for the customers. The In-Plants
You know, I think the benefit for the customer is they're getting arms and legs. They're getting somebody to give them fresh eyes, bring in new ideas, and we're closing. I mean, when I visit customers, the single biggest issue continues to be access to qualified, skilled labor. We're helping solve the biggest challenge that they have. For MSC, there's an added cost for sure. We're adding to our fixed cost base.
Right
... because what we've seen is when the economy goes down, our in-plant associate, our vending machines, the cost is still there. The revenue base drops, but what we are getting is share of wallet, and retention rates are really strong. So you know, the flip side of that, as manufacturing restores, we should have what we refer to as kind of like a coiled spring effect, where the fixed cost is already in place, and we get the revenue back. So we think it's pretty good. The signings rate continues to grow on implants over 20%, for vending, Ryan, close to 10%?
Yeah, high single digits.
On a high base?
Yep.
So if I think about runway, there's plenty of it. You know, to try to put some color on that, our national accounts program, as a percentage of revenues, is, let's call it mid-thirties. And, you know, I think many of our national accounts, if the economics can work and be a win-win-
Mm-hmm
... would be potential candidates for an implant program. Not to mention companies we don't do business with, so I think there's a lot of runway still.
Gotcha. Is there... We talk about the fixed cost structure to that. Is there a potential for when volumes are good? How does the margin work on that versus for the total company?
It's the reverse effect, which means that. So, Ryan's been sharing the data that our in-plant program count is north of 20% growth year on year, and yet our in-plant revenue base, was it 10% last quarter?
Yeah, it was down high single digits, yeah.
So on a per site basis, down high single digits. Now part of that is because we're bringing on all these new accounts, and the new accounts are smaller in absolute dollars, and they're averaging down. But part of it is also that you had a lot of accounts that, you know, large accounts that are just soft-
Mm-hmm
... that have been implants for a couple of years. We kind of ride the tide with them, but as they restore the volume restore, we get very strong incrementals 'cause the costs are all fixed, and it's just pick, pack, ship cost on the way back up.
Increasing the signings currently, what's the ramp-up time in a normal condition?
The timing, we sign an implant for revenue generation beginning to occur, typically takes three months.
Okay.
And then from there, you know, we experience a strong ramp in revenue for about six months till we get closer to that contracted spend. So I'd say on average, about nine months until that implant program's fully ramped. Now, to Erik's point, that implant program is heavily tied to that customer's production rates.
Mm-hmm.
So if they're going at one shift, that ramp's gonna take higher.
Yep.
That ramp's gonna take longer. And then going back to your original question on the op margin for the implants, you know, when an implant gets to about $2.5 million in sales annually, you get to a point where you're flexing your fixed costs at a point where that implant's operating margin is at or slightly above company average. So that's what has excited as we think about a potential recovery because we should benefit from that, from both the top line and margin perspective.
Have you given a number on number of implants that are currently out there, just a total?
Yeah, three hundred and ninety-nine.
Okay, three hundred and ninety-nine.
Yeah, last quarter.
Correct.
All right, and so I guess, the next piece of this is having done the strategy part, having kind of implemented these actions at this point, what should we be thinking about from the finance part, or financials part? Or, as we get volumes back, what are the incrementals that we should be thinking about? What should we be thinking about will drop to the bottom line here at MSC?
Yeah, so I think, the punchline is, we're now in fiscal 2026, so we've been trying to position the business for, you know, who knows what happens with the macro? But if environment stays stable, and let's define stable as a roughly flat IP, we would expect to restore top-line growth at a flat IP, and that would be a combination of continuing the momentum and the high-touch stuff that has already been working, plus some price from tariffs, plus some improvement in the core customer. And, you know, we feel like, you know, our aspiration has been 400 basis points or more above IP. We feel like we should be positioned to do that. So if we can grow mid-single digits in our fiscal year-...
We feel like the business is positioned to drive 20% incremental margins or better, possibly.
Mm-hmm.
And the story there beyond the revenues would be, you know, a roughly stable gross margin picture, which we think would be a good outcome, and most notably, on the operating expense line, the last couple years we've had some big step-ups in OpEx as revenues are dropping. Those moderate, and on top of that, we've done a lot of work in the last two years on rebuilding a productivity pipeline that's, and we've talked a little about it during fiscal 2025 on the supply chain front, but there's a bunch of stuff behind it that has been building and will build in the numbers. So we feel like we're positioned to do at least 20% at mid-single digit, which, you know, on a relative basis compared to prior points in history, I think would be a pretty good outcome.
And then, of course, if we get any, you know, improvement from the macro, we would expect the incremental margin output to get better.
Very good. Can we talk a little bit about the competitive landscape? You know, out there in the world, you know, you're playing against some other large industrial distributors that are out there. Talk about where MSC sits in this. Talk about a little bit about the opportunity that you see.
So, yeah, it's a fascinating market. The first thing I'd say is just it's an amazingly fragmented market, given its size. So the industrial distribution market is around $250 billion in North America, and the top 50 distributors have only 35% of the market. So that means 65% of the market, we're competing against local, regional distributors, kind of MSA by MSA. So there's a pretty massive runway for share capture, and that can be organic. That doesn't mean a roll-up through acquisition necessarily, but organic market share capture from companies that don't have the scale, the technology, you know, the capitalization that an MSC or some of our peers would have. So I think there's a massive opportunity there. Within that, the niche we've attempted to carve out for ourselves, we are really focused on...
Certainly, we're oftentimes known for metalworking, which is about 40%-45% of our revenue is metalworking-related products, so cutting tools, abrasives, machine tool accessories. The reason but from our standpoint, we think that the competitive positioning kind of goes beyond metalworking, and it really goes to focus on improving a manufacturing customer's operations, and that means helping them get more products out faster and doing it at a lower cost, so the reason metalworking is important in that is because compared to other industrial supplies, you know, safety to a degree, or janitorial, or power tools, the cutting tools, the metalworking supplies, actually influence the output of the customer, so they're really important, so we're really focused on helping customers improve operations, so we're doing that with our product offering. We're doing that with technical experts.
So, you know, relative to peers, we've got a large percentage of our sales force, which is in the thousands, with deep machining and manufacturing backgrounds, so they can be on the plant floor making recommendations. We supplement them with technology.
Mm-hmm.
So we're using technology, we're using AI to make them smarter and to bring savings opportunities to our customers. So an example, we have something that we've referred to publicly, MSC MillMax, which is using data, basically data science, to help customers optimize how they machine things. So I, you know, I would say we feel pretty good about our footprint and our competitive advantage. I think beyond that, I mentioned some of the value-added services, where we're reaching inside of our customers' operations with vending and In-Plant.
Gotcha. Is there, given the expertise of those local salespeople on the metal side of the equation, does it behoove you guys to also introduce additional products as well, to kind of make it a more full kind of experience, or...?
Yeah, I mean, we do regularly. So our product portfolio is sitting at two plus million SKUs. So the offering's robust. It's constantly getting replenished. I think on the metalworking side, it's kind of like a three-part formula that allows us to uniquely bring value to the customer. Number one is we bring in somebody who's an expert. Number two is they have a portfolio of products. They're carrying all the brands.
Mm-hmm.
So there's a degree of objectivity that, as a distributor, we can bring, that others can't bring. And then the third thing, we're taking these people with a lot of experience, and we're using data and technology to inform them. So we're mining decades' worth of testing data that we have from all of our other customers.
Mm-hmm
... and we're putting those at our reps' fingertips, so they can go and not just go on gut feel, which does matter, but also use science.
Gotcha.
Then the other thing I'd add, Chirag, is if you think about the local and regional in today's environment, as Erik mentioned, you know, the demand's been soft for about two-plus years right now. You throw in tariff-related inflation, you know, these locals and regionals are struggling and probably bleeding off some working capital.
Mm-hmm.
Product availability is the number one thing our customers care about, given, you know, our working capital investment, our breadth of inventory, you know, we're using that as a lever to gain shares too, as well.
Given that market dynamic, are you seeing those local and regional competitors try to exit, or what's kind of the dynamic of that right now is?
I would say what's fairly... They usually don't exit.
Mm-hmm.
They will usually... At times, there's an opportunity for acquisitions. You know, I would say that market right now, given interest rates, is fairly subdued.
Okay.
It's more an opportunity to take market share, so the strong local distributor will typically have a handful of really good customer relationships that, under normal times, are difficult to penetrate, but when there's times of disruption, it's tougher to get product. They're under financial strain. They're not carrying as much inventory. Maybe they can't carry receivables as long. It creates a wedge, where it's an opportunity for us to, you know, take market share organically.
and that market share gain from that kind of an action, how sticky is that at the end of the day?
If we're using some of the things I described, the kind of arrows in the quiver of the technical expertise, the inventory management solutions like vending and an In-Plant, it becomes very sticky. The retention rate really shoots up.
Gotcha. And one of the other things I wanted to kind of cover here while we have a couple minutes left, is just the idea of what's driving the core customer to kind of utilize some of the tools that you're providing to them right now? What's the impetus for them to make that investment in that digital aspect of things or
I think if we do it right, we actually don't need the customer to do much of anything differently. A lot of the actions for the core customer are around meeting the customer where they're at with an effective offer, a fair price, and an effective marketing engine that's compelling them to buy. And, so that's a lot of the work that's gone on, Chirag. So I mean, we're using a lot of data science and AI to help us do that, both to improve the web experience, to make our marketing offers sharper-
Mm-hmm
... and more relevant. So you know, just to give you an example of what we're talking about, that if a customer's on our website, as opposed to just following them up with a generic offer, like, we're able to get very specific to see what they're looking at, and follow up with them with offers that we know are what they've already looked at. Or, if there's an item that's backordered and we know that we have, you know, our engine can bring back a recommended alternative that's an equivalent, to follow up with them. Those sorts of things that are really timely. So we wanna make it such that the customer doesn't have to work very hard. That, to us, is success.
And one of the things that's just our enhanced search and product navigation-
Mm-hmm
... on the website, making it easier for the customer to find what they're looking for, is something that they value pretty immensely. You know, for instance, a cutting tool could be attributed 200-plus ways, so we built that search engine in-house by people who know the native language and speak the industry. And then also streamlining our checkout experience. We reduced the amount of time or number of clicks by 50%. So just making it more smoother and seamless to transact on mscdirect.com is another one.
And if I'm on the website trying to buy a couple products, you know, how is my pricing different from Ryan, who buys thousands of products from you? Is there a difference in the pricing?
Yes.
Okay.
Yes, yes. If a customer just comes as a guest, they will not see their pricing, but most of our customers are logging in, or the site's remembering them, they will see their pricing.
But what we did-
That's right
... last fiscal year is we went on a SKU-by-SKU basis and developed a market competitive range for each SKU, to make sure that that web price was, competitively priced, regardless if you're Ryan at Ryan's Job Shop, who has ten employees, or you're a large, manufacturer with 1,000 employees, where you're spending a lot, so.
Excellent, and I think one last thing I wanted to touch on is just the. You know, talked about the stabilization of the core customer. Talk a little bit about what you're seeing on the national account side of the equation, and the penetration that you've had, the growth that you see as an opportunity.
Yeah, I think that's probably, if I look back over the past couple years, one of the areas that's actually worked quite well. Most of our national accounts, they're sophisticated, they've got multiple sites, and they're looking for productivity, whether that's cost down or improved throughput. And, you know, all the stuff that we talked about with MSC is resonating there well. So I mean we continue to feel really good about the prospects for the national accounts business.
Excellent. Thank you guys so much for the time.
Yeah.
Appreciate you coming through.
Thank you for hosting us, Chirag.
Thank you.