Global Fastener News

3/20/2013 3:12:00 PM
FASTENER HISTORY
2007 FIN – Roseman: The Fastener World is Shrinking

July 10, 2007 FIN – The fastener industry faces increased competition as a result of free cross-border trading and more transparency, the president of the National Fastener Distributors Association observed in his state-of-the-industry speech at Fastener Tech 07.
“The world has shrunk,” Joel Roseman declared. Fastener manufacturers and distributors are “buying and shipping all over the world.”
Customers are demanding more value-added services from distributors and “are applying pressure to invest in technology and labor infrastructure.” To provide value-added services, “fastener distributors need first class suppliers with outstanding production quality,” Roseman added.
“There is increasing emphasis on assisting OEM customers in design and assembly,” Roseman found.
The U.S. has approximately 5,000 fastener distributors serving a $10 billion market. But fewer than 20 corporations have annual fastener sales higher than $100 million.
Larger companies continue to acquire “small players,” Roseman pointed out that just five North American manufacturers now account for one third of fastener production: Acument, Emhart, Alcoa, Precision Castparts, and ITW.
According to a new Freedonia Report, the world market for fasteners is US$35 to $40 billion with the U.S. consuming $10 billion of that total.
In general, distributors in the U.S. are stronger than in Europe, though Roseman noted that the distribution potential in Europe “is finally waking up.”
“The European Union is flexing its muscles instead of listening to the U.S.”, Roseman observed. Europe has 495 million people compared to 300 million for the U.S. China is the largest with 1.3 billion, followed by India with 1.1 billion, Russian with 143 million and Japan at 127 million. A majority of European fastener demand is from Germany, the UK and France. OEMs buy 65% of the fasteners. The European automotive market takes 29% of production and construction 23%.
China is now producing 29% of fasteners, Europe and the U.S. 15% each, and Taiwan 11%.
Roseman said the largest growth in world demand for fasteners is in Asia and the Pacific.
U.S. suppliers are following customers elsewhere, Roseman noted. For example, Southern California-based Duncan Bolt has opened a branch in Shanghai.
Roseman cited several examples of global expansion by fastener companies. Among them he noted Chicago-based Anixter International Inc. acquired aerospace fastener distributor Eurofast SAS of France. Anixter also bought UK-based fastener distributor Total Supply Solutions Ltd.  GE Supply was acquired by Rexel Group of France and rebranded Gexpro. GE Supply includes fastener distributor GE Supply Logistics, which GE established after acquiring fastener distributor Questron Technologies Inc. Consolidations are happening with OEM customers, too, Roseman noted. Most of Roseman’s fastener career was on the manufacturing and importing sides with Bell Fasteners/Vertex.
In 2004 Roseman joined the distribution side as executive vice president of Canton, MA-based Arnold Industries. Reflecting on the differences, Roseman described “manufacturing is mental: ‘We make something’. Distribution is a mentality. We supply and so does everyone else.”
“Distribution has returned to its roots,” the veteran of 44 years in the fastener industry observed. Recalling when “all we had was the general supply house” and then came the age of specialization from fasteners or safety equipment or other products.
Today fastener distributors are “customer driven vs. market driven,” Roseman finds.
In his own prediction for the future of the fastener industry, Roseman quoted Charles Darwin: “It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change.” ©2007/2013 Fastener Industry News
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