快扣 (FAST) 2023 Q3 法說會逐字稿

Hello and welcome to the Fastenal 2023 Q3 Earnings Results Conference Call and Webcast. (Operator Instructions) As a reminder, this conference is being recorded.

您好，歡迎來到 Fastenal 2023 年第三季獲利結果電話會議和網路廣播。 （操作員指示）謹此提醒，本次會議正在錄製中。

It's now my pleasure to turn the call over to Taylor Ranta of the Fastenal Company. Please go ahead, Taylor.

現在我很高興將電話轉給 Fastenal 公司的 Taylor Ranta。請繼續，泰勒。

Welcome to the Fastenal Company 2023 Third Quarter Earnings Conference Call. This call will be hosted by Dan Florness, our President and Chief Executive Officer; and Holden Lewis, our Chief Financial Officer. The call will last for up to 1 hour and will start with a general overview of our quarterly results and operations, with the remainder of the time being open for questions and answers.

歡迎參加 Fastenal 公司 2023 年第三季財報電話會議。本次電話會議將由我們的總裁兼執行長 Dan Florness 主持；和我們的財務長霍爾頓劉易斯。電話會議將持續長達 1 小時，首先將概述我們的季度業績和營運情況，其餘時間則開放提問和回答。

Today's conference call is a proprietary Fastenal presentation and is being recorded by Fastenal. No recording, reproduction, transmission or distribution of today's call is permitted without Fastenal's consent. This call is being audio simulcast on the Internet via the Fastenal Investor Relations homepage, investor.fastenal.com. A replay of the webcast will be available on the website until December 1, 2023, at midnight Central Time.

今天的電話會議是 Fastenal 專有的演示，並由 Fastenal 錄製。未經 Fastenal 同意，不得錄製、複製、傳輸或散佈今天的通話。本次電話會議透過 Fastenal 投資人關係首頁 Investor.fastenal.com 在網路上音訊聯播。該網路廣播的重播將在 2023 年 12 月 1 日中部時間午夜之前在網站上提供。

As a reminder, today's conference call may include statements regarding the company's future plans and prospects. These statements are based on our current expectations, and we undertake no duty to update them. It is important to note that the company's actual results may differ materially from those anticipated. Factors that could cause actual results to differ from anticipated results are contained in the company's latest earnings release and periodic filings with the Securities and Exchange Commission, and we encourage you to review those factors carefully.

提醒一下，今天的電話會議可能包括有關公司未來計劃和前景的聲明。這些聲明是基於我們目前的預期，我們不承擔更新它們的義務。值得注意的是，公司的實際結果可能與預期有重大差異。可能導致實際結果與預期結果不同的因素包含在公司最新的收益報告和向美國證券交易委員會提交的定期文件中，我們鼓勵您仔細審查這些因素。

I would now call over to Mr. Dan Florness.

我現在打電話給丹‧弗洛內斯先生。

Thank you, Taylor. Good morning, everybody, and thank you for joining our Third Quarter Call.

謝謝你，泰勒。大家早安，感謝您參加我們的第三季電話會議。

I'll start on the -- reference the flipbook on Page 3. Conditions remained challenging in the third quarter of '23, reflected in a daily sales growth rate of 4%. Still, regardless of the year, we celebrate milestones when they occur. I remember just over 10 years ago, when we hit $10 million in daily sales for the first time, we recognized that on this call as well as internally to celebrate that milestone. Some years later, we hit $20 million. Here in the month of September, we broke $30 million in sales per day for the first time in our history, and my congratulations to the Fastenal organization for hitting that milestone.

我將從第 3 頁的翻頁書開始。23 年第三季的情況仍然充滿挑戰，每日銷售額成長率為 4%。儘管如此，無論是哪一年，我們都會在里程碑發生時慶祝它們。我記得就在 10 多年前，當我們的日銷售額首次達到 1000 萬美元時，我們在這次電話會議以及內部慶祝這一里程碑的活動中認識到了這一點。幾年後，我們的銷售額達到了 2000 萬美元。 9 月份，我們歷史上首次突破了 3000 萬美元的日銷售額，我祝賀 Fastenal 組織實現了這一里程碑。

Our earnings -- our sales growth in the quarter translated into EPS growth -- EPS of $0.52, 4.1% growth over the same period last year. Our results reflect the unique profile, product profile, of our business.

我們的收益——本季的銷售成長轉化為每股收益成長——每股收益為 0.52 美元，比去年同期成長 4.1%。我們的成果反映了我們業務的獨特概況、產品概況。

Fasteners still constitute about 1/3 of our sales, and within that subcategory, about 63% is an OEM-oriented fastener. And that business can be very cyclical because of the production needs of each of the customers we're serving. If you look at the rest of the business, it tends to be much more MRO-oriented. Our fastener daily sales, as you've seen in our monthly sales release, have decelerated at a faster rate than our non-fastener business as we've gone through the calendar year.

緊固件仍占我們銷售額的約 1/3，在該子類別中，約 63% 是面向 OEM 的緊固件。由於我們所服務的每個客戶的生產需求，該業務可能具有強烈的週期性。如果你看看其他業務，你會發現它往往更加以 MRO 為導向。正如您在我們的月度銷售發布中看到的那樣，我們的緊固件每日銷售額在整個日曆年中的減速速度比我們的非緊固件業務更快。

The third quarter margin hit was 21%, which matched last year despite the one less selling day. And so earlier, I spoke about the $30 million we do in a day. The quarter had one less day. Many of our -- some of our expenses are tethered, most are not, and so I'm pleased that the team was able to match the operating margin of 21% from last year.

第三季利潤率達到 21%，與去年持平，儘管銷售日少了一個。早些時候，我談到了我們一天的收入為 3000 萬美元。該季度少了一天。我們的許多費用——我們的一些費用是固定的，而大多數則不是，所以我很高興團隊能夠達到去年 21% 的營業利潤率。

But I believe that understates the reality of the performance. If you looked at it on a same-day basis, we believe we would have increased the operating margin because we would have had roughly $10 million more, about 1/3 of that $30 million, in operating income because a good chunk of that flows through because of the change in the nature of the expense.

但我認為這低估了表演的真實性。如果你以當天為基礎來看的話，我們相信我們的營業利潤率會增加，因為我們的營業收入會多出大約1000 萬美元，大約是3000 萬美元的1/3，因為其中很大一部分都在流動由於費用性質的改變。

The Blue Team. If I think about the last several years, we had a unique opportunity to serve the marketplace because of our pristine balance sheet. When COVID hit the globe back in 2020, we were able to step forward and secure and purchased and fund with cash a meaningful increase in inventory primarily centered on safety supplies, because our customers and society in general needed something to get through that period, and we were proud to be part of the solution. We were able to do that because of our balance sheet.

藍隊。如果我想想過去幾年，由於我們原始的資產負債表，我們有一個獨特的機會來服務市場。當2020 年新冠疫情席捲全球時，我們能夠挺身而出，確保並以現金購買並資助庫存的大幅增加，主要集中在安全用品上，因為我們的客戶和社會總體上需要一些東西來度過那段時期，並且我們很自豪能夠成為解決方案的一部分。我們能夠做到這一點是因為我們的資產負債表。

As the global economy reemerged from the pandemic, we saw firsthand, and you saw it in daily news clippings, about the congestion that was going on in supply chains around the planet. Again, as supply chains became more rocky and you couldn't rely on how many days it would take to get product, there's a solution to that: It's stock more products. And we beefed up our balance sheet and our cash flow suffered as a result, but I believe our standing with our customers and in the marketplace never performed better because the market could rely on the covenant that Fastenal provided to them in being a great supply chain partner.

隨著全球經濟從疫情中復甦，我們親眼目睹了全球供應鏈正在發生的擁堵，你也可以在每日新聞剪報中看到這一點。同樣，隨著供應鏈變得更加不穩定，你不能依賴需要多少天才能獲得產品，有一個解決方案：庫存更多產品。我們加強了資產負債表，我們的現金流因此受到影響，但我相信我們在客戶和市場中的地位從未表現得更好，因為市場可以依賴 Fastenal 為​​他們提供的作為一個偉大供應鏈的契約夥伴。

As we move deeper into 2022 and now in 2023, we've been able to unwind a piece of that. And as a result, on a year-in basis, we have converted 121% of our net earnings into operating cash flow. That's our highest performance in a decade that's averaged just shy of 100%, about 95%.

隨著我們進入 2022 年以及現在的 2023 年，我們已經能夠擺脫其中的一部分。因此，我們已將 121% 的淨利潤轉化為營運現金流。這是我們十年來的最高績效，平均接近 100%，約 95%。

If I look at it from the standpoint of relative to a year ago, in the quarter, operating cash grew about 51%. Year-to-date, our operating cash has grown 69%. Again, part of that is a reflection of the investments we made to serve our marketplace and our ability to unwind that in the current environment and translate it into cash flow for the organization to serve our shareholders and to serve the business as we move into the future.

如果我從與一年前相比的角度來看，本季的營運現金成長了約 51%。今年迄今為止，我們的營運現金成長了 69%。同樣，這部分反映了我們為服務市場而進行的投資，以及我們在當前環境下將投資轉化為現金流的能力，以便組織為我們的股東服務，並在我們進入市場時為業務提供服務。 。

Our Onsite and FMI installed bases and our digital footprint continue to expand. And earlier this year, we did some restructuring, and we announced the elevation of Jeff Watts, the Chief Sales Officer in the organization. We did some restructuring of the sales side of our organization because we wanted to double down on the challenge we had put in place in front of everybody going back to the 2015 time frame, and that was really stepping into what we saw as an untapped opportunity to grow our business faster, and that was to expand our Onsite presence.

我們的現場和 FMI 安裝基礎以及我們的數位足跡不斷擴大。今年早些時候，我們進行了一些重組，並宣布提升該組織的首席銷售官傑夫·瓦茨(Jeff Watts)。我們對組織的銷售方面進行了一些重組，因為我們想加倍努力應對我們在 2015 年時間範圍內向所有人提出的挑戰，這確實是進入了我們認為尚未開發的機會為了更快地發展我們的業務，那就是擴大我們的現場業務。

It was earlier this year that, for the first time, the number of Onsites in the organization outnumbered the number of branches in the organization, and that delta continues to expand. And we believe that each of our district managers has the potential in their market to land 2 Onsites per year. And it's our job, and part of the purpose of the restructuring of the sales team, was to really decide, hey, we believe it, but we haven't done it. Let's do this thing.

今年早些時候，該組織中的現場數量首次超過了該組織中的分支機構數量，而這一增量仍在繼續擴大。我們相信，我們的每位區域經理都有潛力在其市場中每年獲得 2 個現場服務。這是我們的工作，也是銷售團隊重組的部分目的，就是真正做出決定，嘿，我們相信這一點，但我們還沒有做到。我們來做這件事吧。

We expanded. Not too many years ago, we were signing 80 Onsites a year and we laid out the plan to get to 400 a year. We expect -- as you see on the next page, we'll do about 350 this year. But we haven't hit that number and we've been kind of stuck. Now COVID threw some challenges our way. It's never an easy time to move in with somebody when they're trying to isolate from the rest of the world. And that challenged our ability to grow coming out of COVID. But looking at the opportunity that's out there, I believe we can do that. We need to turn that belief into reality.

我們擴大了。不久前，我們每年簽約 80 個 Onsite，並制定了每年 400 個的計劃。我們預計——正如您在下一頁看到的那樣，今年我們將進行大約 350 次。但我們還沒有達到這個數字，我們有點陷入困境。現在，新冠疫情為我們帶來了一些挑戰。當某人試圖與世界其他地方隔離時，搬去和他們住在一起從來都不是一件容易的事。這對我們從新冠疫情中恢復成長的能力提出了挑戰。但看看現有的機會，我相信我們可以做到這一點。我們需要將這種信念變成現實。

Flipping to Page 4. Speaking of Onsites, we did sign 93 in the quarter. So our active sites are 1,778, 13.5% greater than they were at the end of third quarter of 2022. In our daily sales in those Onsites, excluding transferred business when you open an Onsite, is in the low double-digit rates. So we're seeing good growth there, we're just not signing enough. And as I said, we still anticipate signing roughly 350 this year.

翻到第 4 頁。說到 Onsites，我們本季確實簽下了 93 名球員。因此，我們的活躍站點為 1,778 個，比 2022 年第三季末增加了 13.5%。在這些 Onsite 的日常銷售額中，不包括開設 Onsite 時轉移的業務，處於較低的兩位數比率。所以我們在那裡看到了良好的成長，只是我們簽約的還不夠。正如我所說，我們仍然預計今年會簽下約 350 名球員。

FMI technology. There, we set lofty goals as well. We said, can we do 100 a day? Not 100 quarter, but 100 a day of our weighted device count. We did 5,969 during the quarter, 95 per day versus 81 a year ago. The team's performing really well here. We're not at the 100. The 100 is a goal, and we will push and push and push until we get there. But I'm really proud of what the team is doing, and you see that shine through.

FMI 技術。在那裡，我們也設定了崇高的目標。我們說，一天可以做100個嗎？我們的加權設備數量不是每季 100 台，而是每天 100 台。本季我們完成了 5,969 次，每天 95 次，而一年前為 81 次。球隊在這裡表現得非常好。我們還沒有到達第 100 名。第 100 名是一個目標，我們將繼續努力，直到我們到達那裡。但我真的為團隊所做的事情感到自豪，你會看到這一點。

When you look at our sales by product line in our monthly and quarterly releases, one thing you do see is our safety business grew almost 10% in the month of September. And a lot of that could be attributed to the success we're seeing in FMI. And it's our anticipation we'll sign between 23,000 and 25,000 MAUs this year. And that's a combination of FASTBin and FASTVend.

當您在每月和每季發布的產品線中查看我們的銷售額時，您確實會看到我們的安全業務在 9 月增長了近 10%。這在很大程度上要歸功於我們在 FMI 中看到的成功。我們預計今年將簽署 23,000 至 25,000 個月活躍用戶。這是 FASTBin 和 FASTVend 的組合。

E-commerce. We can -- it's still, in the scheme of things, a relatively small piece of our business. It's just under 25%, but it's up from single digits not too many years ago. And it currently grows -- it grew about 41% during the quarter. And that's really a case of the marketplace saying to us, we'd prefer to purchase from you this way, and our team in the field and our team and technology building an ever-better mousetrap to serve into that market. As I've shared on prior calls, we still have a ways to go on this piece of our business because a chunk of e-commerce is that unplanned spend, and our goal is to keep making that easier for our team to do in the field.

電子商務。我們可以——從整體上看，它仍然是我們業務中相對較小的一部分。這個比例略低於 25%，但比幾年前的個位數上升。目前它還在增長——本季度增長了約 41%。這確實是市場對我們說的一個例子，我們更願意以這種方式向您購買，我們的現場團隊以及我們的團隊和技術正在建造一個更好的捕鼠器來服務該市場。正如我在之前的電話會議上分享的那樣，我們仍然有辦法繼續開展這部分業務，因為電子商務的很大一部分是計劃外支出，我們的目標是繼續讓我們的團隊在場地。

Finally, if you roll up FMI and e-commerce, we talk about our digital footprint. How much of our revenue is touching some digital aspect of engagement? We were at 57% in the quarter versus 49.5% a year ago. Our challenge to the team is targeting 60% some time before we exit this year. And our long-term expectation is still at that 85% we've talked about in the past that we believe will be part of our digital footprint as we move into the future.

最後，如果綜合 FMI 和電子商務，我們會談論我們的數位足跡。我們的收入有多少涉及到參與度的某些數字方面？本季這一比例為 57%，而一年前為 49.5%。我們對團隊的挑戰是在今年退出之前的某個時間實現 60% 的目標。我們的長期期望仍然是我們過去談到的 85%，我們相信隨著我們走向未來，這將成為我們數位足跡的一部分。

In addition to our earnings release, there's several 8-Ks that have gone out around the earnings time, and I thought I'd share just some insight on the 3.

除了我們的財報發布之外，還有幾款 8-K 在財報發布期間發布，我想我只想分享一些關於 3 的見解。

The first one, and I believe it went out yesterday evening after market close, we announced as we do typically on a quarterly basis, a dividend. We bounced to $0.35 dividend, which is consistent with the dividend we paid in each of the first 3 quarters of the year.

第一個，我相信它是在昨天晚上收盤後發布的，我們像通常每季一樣宣布了股息。我們的股息反彈至 0.35 美元，這與我們今年前三個季度支付的股息一致。

We also announced a few leadership changes. One is a press release we put out. One of the individuals that's been very influential in our ability to beef up our inventory during COVID and ramp it back down and overseeing the distribution and transportation teams as well, is Tony Broersma. Tony has been with the organization roughly 20 years, and he's demonstrated through a career, and we identified that. We lay out his career in the press release the different roles he's had. But he's demonstrated excellence.

我們也宣布了一些領導層變動。其中之一是我們發布的新聞稿。布羅斯瑪 (Tony Broersma) 是我們在新冠疫情期間增加庫存、減少庫存以及監督分銷和運輸團隊的能力非常有影響力的人物之一。托尼已經在該組織工作了大約 20 年，他的職業生涯已經證明了這一點，我們也確定了這一點。我們在新聞稿中介紹了他的職業生涯和他所扮演的不同角色。但他卻展現了卓越的能力。

And yesterday, I asked the Board of Directors to elevate him to Executive Vice President over operations. So essentially elevating his role in that his responsibility will be largely unchanged from what we had previously, but it's recognizing his performance and what we see in the future of Tony within the organization.

昨天，我要求董事會將他提升為負責營運的執行副總裁。因此，本質上提升了他的角色，因為他的職責與我們之前的職責基本上沒有變化，但這是對他的表現以及我們對托尼在組織內的未來的認可。

A second filing went out. It's a required filing related to one of our officers who has decided to move on to a new chapter in his career. And it's Terry Owen, our Chief Operations Officer. I've known Terry for many years. He's been with the organization -- I believe, all told, he's been with the organization about 28 years. The official documents say it's 24.5 because he was, in the earlier years, part time with the organization, but then came full time and had a break in service there.

第二份文件發出了。這是一份與我們的一位官員相關的必填文件，他決定開啟職業生涯的新篇章。這是特里·歐文，我們的首席營運長。我認識特里很多年了。他一直在這個組織工作——我相信，總而言之，他已經在這個組織工作了大約 28 年。官方文件稱這個數字是 24.5，因為早年他曾在該組織兼職，但後來轉為全職工作並在那裡休息了一段時間。

But Terry has demonstrated a career of exemplary service to the organization. We've had some conversations in recent months about some aspirations he had in the -- he's looking at the number of years he has left in his career and what he wants to do as he moves into his next chapter of life. He had discovered an opportunity that he thought was quite compelling that would serve his desire for the future as well as his family. Terry had relocated to the East Coast of the U.S. several years ago for family reasons.

但特里在職涯中為該組織提供了堪稱典範的服務。近幾個月來，我們就他的一些願望進行了一些對話——他正在考慮他的職業生涯還剩多少年，以及在進入人生的下一個篇章時他想做什麼。他發現了一個他認為非常有吸引力的機會，可以滿足他和家人對未來的渴望。特里幾年前因家庭因素搬到了美國東海岸。

And all I can say to Terry is, you're a good friend. I wish you best of luck in your next endeavor. And thank you for the team that you developed, Tony being one of them, but thank you for the team you developed.

我只能對特里說，你是個好朋友。我祝你在接下來的努力中一切順利。感謝你建立的團隊，托尼就是其中之一，但感謝你建立的團隊。

The organization has always prided itself on our ability to build leaders and promote from within. And every time we see a person decide to take a new chapter in life, whether that's after retirement or going into a family business or whatever the case might be, we always see another layer of talent right behind that person ready to step in and discover their future and their opportunity.

組織一直為我們培養領導者和從內部提拔的能力感到自豪。每當我們看到一個人決定開啟人生的新篇章時，無論是退休後還是進入家族企業或其他任何情況，我們總是會看到那個人背後的另一層才華準備介入並發現他們的未來和機會。

With that, I'll turn it over to Holden.

有了這個，我就把它交給霍爾頓。

Thank you, Dan. Good morning, everyone. I'm going to start on the slide deck on Slide 5.

謝謝你，丹。大家，早安。我將從幻燈片 5 的幻燈片開始。

Total sales in the third quarter of 2023 were up 2.4%. Adjusting for the fact that we had one fewer selling day in the quarter, our daily sales were up 4%. Frankly, the dynamics of the quarter varied very little from the second quarter of 2023. Macro data points and feedback from the regional leadership continue to point to sluggish demand and a cautious outlook for spending and production. We are certainly encouraged by the improvement in our September daily sales rate to up 5%. However, it seems to have more to do with easing comparisons in certain parts of our business than a clear signal of firming customer demand or brightening outlooks.

2023 年第三季總銷售額成長 2.4%。考慮到本季銷售日數減少的事實，我們的每日銷售額成長了 4%。坦白說，該季度的動態與 2023 年第二季度的變化很小。宏觀數據點和地區領導層的反饋繼續表明需求疲軟以及支出和生產前景謹慎。我們對 9 月份日銷量提高 5% 感到鼓舞。然而，這似乎與我們業務某些部分的比較的緩和有關，而不是客戶需求堅挺或前景光明的明確訊號。

Dynamics around our products, customers and end markets have also trended similarly over the past 3 and 6 months. Manufacturing grew 6.4% despite soft demand, benefiting from further growth in the Onsite installed base and initiatives in national accounts in the field to target key account planned spend, which is disproportionately manufacturing-oriented. Non-manufacturing was down 1.3%, though the rate of decline moderated as we began to hit easier comparisons in nonresidential construction, reseller and warehousing customers.

在過去的 3 個月和 6 個月中，我們的產品、客戶和終端市場的動態也呈現類似的趨勢。儘管需求疲軟，製造業仍增長了 6.4%，這得益於現場安裝基礎的進一步增長以及該領域國民賬戶針對關鍵客戶計劃支出（不成比例地以製造業為導向）的舉措。非製造業下降了 1.3%，但隨著我們開始對非住宅建築、經銷商和倉儲客戶進行更簡單的比較，下降速度有所放緩。

From a product standpoint, fasteners are relatively weak at down 2% due to their more cyclical profile and rapid pricing moderation. In contrast, nonfastener products remained healthy due to further growth in our vending installed base and improved comparisons. As it relates to pricing, it remains positive but has come back to a range of 0% to 2% that we consider to be typical under normal economic conditions. We did experience very modest deflation within our fastener product line.

從產品角度來看，由於緊固件更具週期性且價格快速調整，其跌幅相對較弱，下降了 2%。相較之下，由於我們的自動販賣機安裝基礎的進一步成長和比較的改善，非緊固件產品保持健康。就定價而言，它仍然是積極的，但已回到我們認為正常經濟條件下典型的 0% 至 2% 的範圍。我們的緊固件產品線確實經歷了非常溫和的通貨緊縮。

Now to Slide 6. Operating margin in the third quarter of 2023 was 21%, equaling our margin from the third quarter of 2022. We typically believe that given mid-single-digit daily sales growth, we should be able to defend our margin. However, that we were able to do so despite the headwinds related to the one fewer sales day that Dan described in his prepared remarks, points to what we believe was more effective cost management by the Blue Team relative to the second quarter of 2023.

現在看投影片6.2023 年第三季的營業利潤率為21%，與2022 年第三季的利潤率持平。我們通常認為，鑑於日銷售額中個位數成長，我們應該能夠捍衛我們的利潤率。然而，儘管丹在準備好的演講中描述了與銷售日減少有關的不利因素，但我們仍然能夠做到這一點，這表明我們認為藍隊的成本管理相對於 2023 年第二季度更加有效。

Gross margin was 45.9%, flat in the period from the prior year. Freight remained favorable, reflecting modest leverage of our captive fleet expenses, reduced use of external freight providers, lower fuel and reduced shipping costs. We also benefited from the absence of last year's $3.4 million glove write-down and slightly positive price/cost. These favorable variables matched the margin drag related to product and customer mix.

毛利率為45.9%，與去年同期持平。貨運仍然有利，反映出我們自營車隊費用的適度槓桿、減少了對外部貨運提供者的使用、較低的燃料和運輸成本。我們還受益於去年 340 萬美元的手套減記的消失以及略為正的價格/成本。這些有利的變數與產品和客戶組合相關的利潤拖累相符。

The impact of mix was slightly less negative and the impact of price/cost was slightly more positive than anticipated at the second quarter call. We did not take any incremental pricing actions in the period, and the favorable price/cost in the current period largely regains the negative price/cost we discussed in the third quarter of 2022. We expect price/cost to trend neutral in coming quarters.

與第二季電話會議的預期相比，混合影響的負面影響略小，價格/成本的影響稍微正面。在此期間我們沒有採取任何增量定價行動，並且當前有利的價格/成本在很大程度上恢復了我們在2022 年第三季度討論的負價格/成本。我們預計未來幾個季度價格/成本將趨於中性。

SG&A was 25% of sales, up from 24.8% of sales, mostly due to the one fewer sales day. We experienced modest payroll leverage with lower incentive pay, reflecting slower growth in the third quarter of 2023 versus the third quarter of 2022. This was more than offset by rising information technology spend, an increase in general insurance costs, increased expenses to maintain our selling-related truck fleet and higher bad debt. Relative to the second quarter of 2023, the organization tightened its management of discretionary expenses with spending on travel, meals and supplies being down 0.6% year-to-year and continued moderation of growth in our FTE count.

SG&A 佔銷售額的 25%，高於銷售額的 24.8%，主要是由於銷售日減少了一個。我們經歷了適度的薪資槓桿和較低的激勵薪酬，反映出2023 年第三季的成長較2022 年第三季放緩。這被資訊科技支出的增加、一般保險成本的增加、維持銷售的費用增加所抵消。相關的卡車車隊和更高的壞帳。與 2023 年第二季相比，該組織加強了對可自由支配費用的管理，差旅、餐飲和用品支出年減 0.6%，FTE 人數成長持續放緩。

Putting everything together, we reported third quarter 2023 EPS of $0.52, up 4.1% from $0.50 in the third quarter of 2022.

綜合考慮，我們報告 2023 年第三季每股收益為 0.52 美元，比 2022 年第三季的 0.50 美元增長 4.1%。

Turning to Slide 7. We generated $388 million in operating cash in the third quarter of 2023 or 131% of net income in the period. Cash generation is traditionally strong in third quarters, though conversion in the current quarter was stronger than is historically typical. This reflects reduced need for working capital as demand slows down and improvements in inventory. The resulting strong cash flow means our balance sheet remains conservatively capitalized at the end of the third quarter of 2023, with debt ending at 7% of total capital versus 9.4% in the second quarter of 2023 and 14.9% in the third quarter of 2022.

轉向幻燈片 7。我們在 2023 年第三季產生了 3.88 億美元的營運現金，佔該期間淨利潤的 131%。傳統上，第三季的現金產生能力很強，儘管本季的轉換率比歷史上的典型水準要強。這反映出隨著需求放緩和庫存改善，營運資金需求減少。由此產生的強勁現金流意味著我們的資產負債表在2023 年第三季末仍維持保守資本，債務佔總資本的7%，而2023 年第二季為9.4%，2022 年第三季為14.9%。

Year-over-year, accounts receivable were up 5.4%, which is a combination of sales growth and the impact of mix due to faster growth of larger customers, which tend to have longer terms. Inventories fell 9.8%. Slower customer demand reduced working capital needs. We are unwinding inventory layers built in late 2021 and early 2022 to manage supply chain constraints. And our field and hub operations have sustainably streamlined inventory processes.

應收帳款年增 5.4%，這是銷售成長和大客戶成長較快（這些客戶的期限往往較長）的綜合影響。庫存下降9.8%。客戶需求放緩減少了營運資金需求。我們正在取消 2021 年底和 2022 年初建立的庫存層，以管理供應鏈限制。我們的現場和樞紐運作持續簡化了庫存流程。

Our days on hand fell again to 134.6 days, the lowest since 2002, which reflects improved velocity of inventories through our internal network, a reduction of retail stock in branches and improvements in stocking processes. We reduced our net capital spending range to $180 million to $190 million, down from $210 million to $230 million. This largely reflects timing and deferrals related to hub automation and expansion projects that we do expect to be included in next year's capital spending plans.

我們的庫存天數再次下降至 134.6 天，為 2002 年以來的最低水平，這反映出我們內部網路庫存速度的提高、分支機構零售庫存的減少以及庫存流程的改進。我們將淨資本支出範圍從 2.1 億美元至 2.3 億美元減少至 1.8 億美元至 1.9 億美元。這在很大程度上反映了與樞紐自動化和擴建項目相關的時間表和延期，我們預計這些項目將包含在明年的資本支出計劃中。

The third quarter of 2023 profiled very similarly to the second quarter of 2023. We continue to experience stagnant demand, a cyclical shift favoring non-fasteners and a secular shift favoring larger manufacturing-oriented customers. Growth driver performance is not quite where we would like it to be, but it's at levels that continue to support good growth in our installed base, success in providing differentiated value to our customers and further cost and asset efficiency.

2023 年第三季的情況與 2023 年第二季非常相似。我們繼續經歷需求停滯、有利於非緊固件的周期性轉變以及有利於大型製造業導向型客戶的長期轉變。成長驅動力的表現並未完全達到我們希望的水平，但它的水平足以繼續支持我們的裝置基礎的良好成長，成功地為我們的客戶提供差異化價值以及進一步的成本和資產效率。

Operating margin performance remained stable despite the slow growth, and our capacity to generate cash to reinvest in the business remained strong. We did begin to experience easier comparisons in certain markets, and our management of discretionary expenses improved over the preceding quarter. We continue to believe we are positioned to meaningfully accelerate sales growth when underlying demand improves while sustaining strong profitability and returns.

儘管成長緩慢，營業利潤率表現仍然穩定，我們產生現金再投資於業務的能力仍然強勁。我們確實開始在某些市場進行更容易的比較，我們對可自由支配費用的管理比上一季有所改善。我們仍然相信，當潛在需求改善時，我們將能夠大幅加速銷售成長，同時保持強勁的獲利能力和回報。

With that, operator, we'll turn it over to begin the Q&A.

這樣，操作員，我們將把它移交給開始問答。

(Operator Instructions) Our first question is coming from Nigel Coe from Wolfe Research.

（操作員說明）我們的第一個問題來自 Wolfe Research 的 Nigel Coe。

So the price/cost definitely coming a bit better than what we expected. Is this as simple as thinking about the ocean freight rate normalization, and we're starting to see that now coming through from inventory? So I'm just wondering if -- when we obviously talk about the freight benefits, just wondering if that's more ocean-bound freight as opposed to domestic.

所以價格/成本肯定比我們預期的要好一些。這是否像考慮海運費正常化一樣簡單，我們現在開始從庫存中看到這一點？所以我只是想知道，當我們顯然談論貨運收益時，只是想知道海運貨運是否比國內貨運更多。

I think, Nigel, there's a little bit of that, that's flowing through. But we've definitely seen lower costs related specifically to our fastener line. And I think that's largely what you're seeing. So yes, when we think about what caused a lot of the inflation in our business, there was an element of it that was raw material, but there was a fairly significant element that was related to transportation. And so yes, I think you're just seeing some of that gradual impact play through.

我想，奈傑爾，有一點這樣的東西正在流動。但我們確實看到了與我們的緊固件系列相關的成本降低。我認為這很大程度上就是您所看到的。所以，是的，當我們思考是什麼導致了我們業務中的大量通貨膨脹時，其中有一個因素是原材料，但還有一個相當重要的因素與運輸有關。所以，是的，我認為你只是看到了一些逐漸產生的影響。

But I want to also give a lot of credit to the organization, particularly sort of the field and the national accounts teams and the folks that manage pricing. I mean, I believe 5 years ago that we wouldn't as effectively have been able to align our pricing and cost in the way we have. The variance that we've had against what's going on in the market has been fairly tame.

但我也想對這個組織給予很大的信任，特別是該領域、國民帳戶團隊以及管理定價的人員。我的意思是，我相信五年前，我們無法像現在這樣有效地調整我們的定價和成本。我們與市場上發生的情況的差異相當溫和。

If you remember, this quarter last year, we were talking about a 20 basis point deficit, and we felt that, that was going to -- we felt at the time that we hadn't quite caught up with where costing went with fasteners. I think our guidance at the time was we kind of expect that costing to catch up. It has caught up and probably came in a little bit. But I think over coming quarters, you're going to see the benefit that we saw this quarter, which largely recaptures the deficit we saw a year ago, I think you're going to see that begin to moderate.

如果你還記得，去年這個季度，我們談論了 20 個基點的赤字，我們認為，這將會——我們當時認為我們還沒有完全跟上緊固件成本計算的方向。我認為我們當時的指導是我們希望成本能夠趕上。它已經迎頭趕上，並且可能有所進步。但我認為在接下來的幾個季度中，您將看到我們在本季度看到的收益，這在很大程度上彌補了我們一年前看到的赤字，我認為您將看到這種情況開始放緩。

So it wasn't what we expected either. As you know, we target neutral. We continue to target neutral. But I don't think that it's a sustained trend either. I think as we go through the next couple of quarters, it's going to trend back to neutral.

所以這也不是我們所期望的。如您所知，我們的目標是中立。我們繼續以中性為目標。但我也不認為這是一個持續的趨勢。我認為，當我們經歷接下來的幾個季度時，它將會恢復到中性。

Okay. And then on the CapEx, the pushouts of the projects, was that an elected push out? Just want to see if that was maybe just, I don't know, supply chain challenges or delays from a supply side. Or was that elective?

好的。然後在資本支出上，專案的推出，是選舉推出的嗎？只是想看看這是否只是（我不知道）供應鏈挑戰或供應方的延誤。還是那是選修的？

The majority of it was not elective. We had a -- there's a piece of property in there, the signing of which just got pushed out from fourth quarter to first quarter. That's just a calendar timing issue. We did have some automation projects where it's just a matter of when the product is going to come in. We always knew it would be later in the year, and it's just going to sort of cross the calendar line.

其中大部分不是選修的。我們那裡有一處房產，簽約剛從第四季推遲到第一季。這只是日曆時間問題。我們確實有一些自動化項目，問題只是產品何時上市。我們一直都知道會在今年晚些時候，而且會跨越日曆線。

So the majority of it relates to projects that we remain committed and excited about and will fall into the 2024 and it was more a function of timing. Now I will say that, earlier in the year, we did say, "Look, take a look at your budgets. It's not a great year in terms of demand and tighten some stuff up." So I think there's some elements in there of what you're talking about, and that's just about enforcing discipline across the organization. But I think the larger portion of it relates to projects that will be coming back into the business in 2024.

因此，其中大部分與我們仍然致力於並感到興奮的項目有關，這些項目將在 2024 年進行，這更多的是時間的函數。現在我要說的是，今年早些時候，我們確實說過，“看看，看看你的預算。就需求而言，今年不是好年頭，需要收緊一些東西。”所以我認為你所談論的內容中有一些要素，那就是在整個組織中強制執行紀律。但我認為其中很大一部分與 2024 年將重新投入業務的項目有關。

Your next question is coming from Chris Snyder from UBS.

你們的下一個問題來自瑞銀集團 (UBS) 的 Chris Snyder。

I wanted to follow up on some of the price/cost commentary. I understand that price/cost was positive from a year-on-year perspective. But I think you said the deficit was largely caught up, which would kind of maybe imply that you're still a bit price/cost negative at the moment. So when we think about that trajectory back to neutral, is that like incremental price/cost positive to get there? Or is that incremental price/cost giveback to get there?

我想跟進一些價格/成本評論。據我了解，從同比角度來看，價格/成本是正面的。但我認為你說赤字很大程度上已被追上，這可能意味著你目前仍然對價格/成本持負面態度。因此，當我們考慮回到中性的軌跡時，這是否意味著增量價格/成本正值才能實現這一目標？還是為了實現這一目標而增加的價格/成本回饋？

I mean, I guess I'm viewing the next couple of quarters as being the inverse of the last few. Again, if you remember, in Q3, we talked about fasteners, we had a little bit of a deficit in price/cost. And the guidance at the time was that, over the next few quarters, you would see that deficit begin to decline.

我的意思是，我想我認為接下來的幾個季度將與過去幾季相反。再說一次，如果你還記得，在第三季度，我們談論了緊固件，我們在價格/成本方面有一點赤字。當時的指導是，在接下來的幾個季度裡，你會看到赤字開始下降。

Was there a faster deficit in Q4? Yes, there was. Is it possible that we get that fastener deficit from Q4 back in Q4 of this upcoming quarter? Yes, I think that that's possible. But the deficit Q4 last year was not as wide as the deficit in Q3, and I'm not expecting the benefit in Q4 this year to be at the same level as the benefit we saw in Q3.

第四季赤字是否出現更快？是的，有。我們是否有可能在下個季度的第四季恢復第四季的緊固件赤字？是的，我認為這是可能的。但去年第四季的赤字沒有第三季那麼大，我預計今年第四季的效益不會與第三季的效益處於同一水平。

Really, again, this feels very much like the inverse of what occurred last year. And at the end of the day, yes, we'll probably wind up, over the course of multi years, kind of being neutral from a price/cost standpoint. But within that overall trend, there's been a little bit of swingy-ness.

真的，這又感覺與去年發生的情況非常相似。最終，是的，我們可能會在多年的過程中從價格/成本的角度來看保持中立。但在整體趨勢中，存在著一些搖擺不定的情況。

I appreciate that. And then maybe could you just talk a little bit about pricing on the non-fastener side? I think -- I understand that the fastener is seeing some price pressure, whether it's the metal or the freight. But can you talk about the non-fastener side of the business?

我很感激。那麼也許您可以談談非緊固件方面的定價嗎？我認為——據我了解，緊固件面臨著一些價格壓力，無論是金屬還是運費。但您能談談業務的非緊固件方面嗎？

Yes. We don't talk about it a lot because it's behaving largely like we would expect it to. Pricing in the non-fastener areas has moderated just like our overall pricing has. But much like our overall pricing levels at this point, it's kind of back in the range that we would normally expect it to be in. It's still positive. It's lower than it was a year ago. But frankly, that area is performing largely as we expected.

是的。我們不太談論它，因為它的行為很大程度上與我們期望的一樣。正如我們的整體定價一樣，非緊固件領域的定價也有所放緩。但就像我們目前的整體定價水平一樣，它有點回到了我們通常預期的範圍內。它仍然是正面的。它比一年前要低。但坦白說，該領域的表現基本上符合我們的預期。

Historically, we have not traditionally seen negative pricing in non-fastener products. And I don't expect that, that's going to happen in this cycle either. So we view that conditions for pricing in those products to be pretty stable here.

從歷史上看，我們從未見過非緊固件產品的負定價。我也不認為這種情況會在本週期中發生。因此，我們認為這些產品的定價條件相當穩定。

Your next question is coming from David Manthey from Baird.

您的下一個問題來自貝爾德 (Baird) 的大衛曼蒂 (David Manthey)。

Dan, Holden, first question, could you talk about the feedback and early returns after you reopened the front doors of your stores last month?

Dan，Holden，第一個問題，您能談談上個月重新開放商店前門後的回饋和提前退貨嗎？

I don't -- there hasn't been a lot of feedback. One thing I do every day, and I've done this -- quite frankly, I've done this for the last 8 years, is I end each day in every web feedback that comes in from customers, I try to read. I'm not going to say I read 100%, but I've tried to. And that tells you it's a small-enough number that I'm able to even try to when you consider the hundreds of thousands of customers we have.

我不知道——還沒有太多反饋。我每天都會做的一件事，而且我已經做到了這一點——坦率地說，我在過去 8 年裡一直這樣做，就是在每天結束時我嘗試閱讀來自客戶的每一條網絡反饋。我不會說我讀了100%，但我已經盡力了。這告訴你，當你考慮到我們擁有數十萬客戶時，這個數字已經足夠小了，我甚至可以嘗試這樣做。

And over time, you pick up different themes. And obviously, you could -- if I go back to the COVID era, boy, were there themes jumping out. The themes were a society really frustrated, not with us, just with some -- just frustrated, scared about what's going on. Most of our business is in the U.S., and so scared about what was going on and things that were going on and chaos around them.

隨著時間的推移，你會選擇不同的主題。顯然，如果我回到新冠疫情時代，你會發現有哪些主題會跳出來。主題是一個真正沮喪的社會，不是我們，而是一些人——只是沮喪，對正在發生的事情感到害怕。我們的大部分業務都在美國，因此對周圍正在發生的事情和混亂感到非常害怕。

And oftentimes, I would call -- I would -- once a week, maybe twice a week, call somebody up. Kind of throws them a little off-kilter when they get a call from me right after they've put something, but you learn a lot that way.

通常，我會每週一次，也許每週兩次，打電話給某人。當他們在放完東西後立即接到我的電話時，有點讓他們有點不適應，但這樣你可以學到很多東西。

It's largely almost too quick to see, but my predecessor had a phrase he used sometimes, and he used to keep it on his computer screen. So if you want to grow your business, make it easy to buy. And sometimes, if you confuse the market -- it's kind of like in today's world -- you've got to eat. It's a rare time that I go out to eat that I don't check on my phone to see if the place is even open. Mondays and Tuesdays especially, you can't necessarily count on it, especially in a town of 25,000 people. Economics don't work for that business to be open certain nights.

這在很大程度上幾乎太快了，但我的前任有時會使用一個短語，並且他經常將其保留在電腦螢幕上。因此，如果您想發展業務，請讓購買變得容易。有時，如果你混淆了市場——就像當今世界一樣——你就必須吃飯。我很少出去吃飯，我不會用手機檢查這個地方是否有營業。尤其是週一和週二，你不一定能指望它，尤其是在一個擁有 25,000 人的城鎮中。從經濟角度來看，該企業在某些晚上營業是行不通的。

And so the biggest thing we needed to do is be really, really consistent with what we're doing. And the market reacts to that by saying, "Okay, this makes sense." And -- but if you get there and the door is closed, and you were expecting it to be opened. So I don't have a lot of insight for you, Dave, other than to say, there's probably fewer comments about, I stopped there at 8 in the morning or 10 in the morning and your door was closed. What's going on?

因此，我們需要做的最重要的事情就是與我們正在做的事情保持真正、真正的一致。市場對此的反應是：“好吧，這是有道理的。”而且──但是如果你到達那裡，門是關著的，而你卻期望它會被打開。所以我對你沒有太多的見解，戴夫，除了說，關於我在早上 8 點或 10 點停在那裡，你的門關著的評論可能較少。這是怎麼回事？

And on the flip side, it's also empathy is a 2-way street. And it's really looking at it and saying -- it's finding that spot where the business can meet the roads -- the wheel can meet the roads, or the rubber meets the road, whatever that expression is. But it's good for both parties. And good is that we can provide a high level of service and it's economically good business for, again, both parties. I believe we can find it.

另一方面，同理心也是一條雙向路。它實際上是在審視它並說——它正在尋找業務可以與道路相遇的地方——車輪可以與道路相遇，或者橡膠可以與道路相遇，無論這個表達是什麼。但這對雙方都有好處。好處是我們可以提供高水準的服務，這對雙方來說都是經濟上的好生意。我相信我們能找到它。

A lot of that business is -- has migrated, and we've seen it in our own internal statistics, really since COVID started, the amount of that business that's migrated to the Internet. And it's really -- in some ways, the market making that transition of, boy, it's a lot easier if I pop an order online and then go pick it up. It's easier for the customer. And so I think that's part of it.

很多業務已經遷移，我們在自己的內部統計數據中看到了這一點，實際上自新冠疫情爆發以來，有多少業務遷移到了互聯網。從某些方面來說，市場確實正在發生這種轉變，天哪，如果我在網上下訂單然後去取貨就會容易得多。對客戶來說更容易。所以我認為這是其中的一部分。

And it's also reminding our teams locally that our goal in everything we do is always trying to figure out how to make the market opportunity bigger and find good, productive use of our time to serve the marketplace and serve our customer. I like it from the standpoint, I think it's a better message for our team, go out and grow the (expletive) business and don't -- and stop spending time about what you're not going to do.

它也提醒我們當地的團隊，我們所做的一切的目標始終是試圖弄清楚如何擴大市場機會，並找到有效、富有成效的方式來利用我們的時間來服務市場和服務我們的客戶。從我的角度來看，我喜歡它，我認為這對我們的團隊來說是一個更好的信息，出去發展（髒話）業務，而不是 - 並且停止花時間在你不會做的事情上。

And just probably the one piece of perspective I might add, David, is for a long time or for several years, we had a lot of different models occurring within the branch, right? There were some branches that did in fact close their doors. There were some branches that had very specific local hours. There were some branches that stayed open. There are branches that flipped their counters, branches that didn't.

大衛，我可能要補充的一個觀點是，在很長一段時間或幾年裡，我們在分支機構內出現了很多不同的模型，對嗎？事實上，有一些分支機構確實關門了。有些分行有非常特定的當地時間。有些分行仍然營業。有些分行翻轉了櫃檯，有些分行則沒有。

And I think what you're really seeing and picking up on is, after several years of experimentation, which is really what Fastenal does. It came time to say, let's settle on and align around kind of an agreed approach to it. And so what you picked up is essentially us having looked at the various experimentations that were run throughout the organization for a number of years and saying, "Hey, here's the path forward that we're going to take."

我認為，經過幾年的實驗，您真正看到和發現的是 Fastenal 所做的事情。是時候說，讓我們確定並圍繞某種商定的方法進行協調。因此，您得到的實質上是我們在研究了整個組織多年來進行的各種實驗後說：“嘿，這就是我們將要採取的前進道路。”

Our next question is coming from Jacob Levinson from Melius Research.

我們的下一個問題來自 Melius Research 的 Jacob Levinson。

I know you guys sell into lots of different end markets. And maybe it's not always easy to tell exactly where the product is going at the end of the day. But maybe you can just walk us through what you're hearing from the field in terms of some of the positive and negative outliers on a vertical basis.

我知道你們銷往許多不同的終端市場。也許要準確地知道產品最終的去向並不總是那麼容易。但也許您可以向我們介紹一下您從現場聽到的垂直基礎上的一些正面和負面異常值。

Yes. Unfortunately, we don't have great granular insight market by market. The example I often give is there's a lot of manufacturers out there that are considered manufacturers in our business, but they might have enormous oil and gas exposure, but we don't see that oil and gas exposure. So I wish I could give you more detail end market by end market, we just don't have it. The data doesn't break out that way.

是的。不幸的是，我們沒有對各個市場進行深入的洞察。我經常舉的例子是，有很多製造商被認為是我們行業中的製造商，但他們可能擁有巨大的石油和天然氣風險，但我們沒有看到石油和天然氣風險。因此，我希望能夠逐一向您提供更多詳細的終端市場信息，但我們只是沒有。數據並非如此。

The feedback from the field continues to be fairly uniform. I think aerospace is doing fairly well. I'm not getting a lot of feedback that anything else is really inflecting more favorably. I'm getting the feedback that everything else remains fairly tepid. And that generally speaking, managers across our business are fairly cautious on where the market is today.

來自現場的回饋仍然相當一致。我認為航空航天做得相當不錯。我沒有得到太多反饋表明其他任何事情確實會產生更有利的影響。我得到的回饋是其他一切仍然相當不溫不火。一般來說，我們整個業務的經理對當今的市場狀況相當謹慎。

But I wish we could give you more granularity end market by end market, we just don't have the means to measure it that way.

但我希望我們能夠為您提供更詳細的終端市場信息，我們只是沒有辦法以這種方式進行衡量。

The only thing I'll add to it, and my ask of everybody hearing this, don't read too much into it because it's a relatively small piece of our business. But when I'm going through the numbers, the individual that pulls the stuff together, I often wear him out a little bit with questions and just to understand it myself.

我要補充的唯一一點是，我要求每個聽到這個的人不要過度解讀它，因為它只是我們業務中相對較小的一部分。但當我查看這些數字時，我經常會因為問題而讓他有點疲憊，而只是為了讓我自己理解。

And the other end markets, which is about 11% of our business, it's a bunch of stuff in there, hence the term other. And it peaked up. And in one of the components of that is our business. And our government business has been gaining strength as we've gone through the year, but it didn't gain strength sequentially in September, and sometimes that's just a function of comp.

而其他終端市場，大約占我們業務的 11%，裡面有很多東西，因此有了「其他」這個詞。它達到了頂峰。其中之一就是我們的業務。我們的政府業務在這一年中一直在增強，但在 9 月並沒有連續增強，有時這只是比較的函數。

But generally speaking, it's been gaining because we've been really successful in Onsite and in government locations that we have in the business. And so I was asking him, I said, "I know government didn't tick up. Why did that tick up?" And a big chunk of that other is transportation. And it's not -- automotive transportation is not in there. It's transportation that we sell into, and that saw a real uptick.

但總的來說，它正在取得進展，因為我們在現場和政府場所都取得了真正的成功。所以我問他，我說，“我知道政府沒有採取行動。為什麼採取行動？”其中很大一部分是交通。但事實並非如此——汽車運輸不在那裡。我們銷售的是交通運輸業，銷售確實有所上升。

I'm not sure what that means. So maybe I created more questions with that answer than an answer with that answer. But that was the one thing that jumped out at me. I was -- I'm still scratching my head on it, but at least I know that's what drove the other end markets to grow 12.5%.

我不確定這是什麼意思。所以也許我用這個答案創造了更多的問題，而不是用這個答案創造的答案。但這是讓我震驚的一件事。我仍然摸不著頭腦，但至少我知道這就是推動其他終端市場成長 12.5% 的原因。

Okay. That's helpful color. Maybe just switching gears quickly on -- I think, maybe in past cycles, FAST would have maybe had trouble holding the margin line and revenue growth at these lower levels. And I guess the question is, structurally, what's really changed in the business today versus prior cycles, and gives you that confidence in maybe it being able to have higher incremental margins going forward, even if the growth rates aren't necessarily, in this macro backdrop at least, higher?

好的。這是有用的顏色。也許只是快速切換——我認為，也許在過去的周期中，FAST 可能很難將利潤率和收入成長保持在較低的水平。我想問題是，從結構上講，與之前的周期相比，今天的業務真正發生了哪些變化，並使您有信心未來能夠獲得更高的增量利潤，即使增長率不一定如此。至少在宏觀背景下，更高嗎？

Yes. I think there's a few things in there. One is, when we came through the tariff period, that was brutal from the standpoint of our pricing tools, being so decentralized, communicating what was changing almost on a week-by-week basis was incredibly difficult.

是的。我認為裡面有一些東西。其一是，當我們度過關稅期時，從我們的定價工具的角度來看，這是殘酷的，因為我們是如此分散，幾乎每週都在變化的情況溝通起來非常困難。

And there was one quarter I sat down with our IT -- John Soderberg, our leader of IT, and I said, "John, I'm going to ask you something that I never -- that I told you I'd never ask you to do. We're going to shut down all IT development for whatever time it takes. And we're going to focus 100% on of our energy on a better pricing tool for our organization to use because this is a disaster we're going through right now, and we can't handle these fluctuations because our system isn't built for that."

有四分之一的時間我和我們的IT 部門——約翰·索德伯格（John Soderberg），我們的IT 主管，坐下來，我說，「約翰，我要問你一些我從未問過的問題——我告訴過你我永遠不會問的你要做的。我們將關閉所有IT 開發，無論需要多久。我們將把100% 的精力集中在更好的定價工具上，供我們的組織使用，因為這對我們來說是一場災難。現在正在經歷，我們無法應對這些波動，因為我們的系統不是為此而構建的。”

And we shut down IT and we focused on building what we call our price review tool. And then we had other folks in the organization that took that, our district managers. We have a key person here in Winona, Kevin Fitzgerald, who took that and created a great tool. And our ability to price -- and pricing isn't -- is much about not being too high as it is about not being too low. Because sometimes, if your price isn't precise and you're too high, you might actually hurt your margin because you don't sell enough of that. Or if you were 3 points lower, you would sell more of it, and it'd help your margin.

我們關閉了 IT，專注於建立我們所謂的價格審查工具。然後我們組織中的其他人，我們的地區經理，接手了這份工作。我們在威諾納有一位關鍵人物，凱文·菲茨杰拉德（Kevin Fitzgerald），他利用了這一點並創建了一個很棒的工具。我們的定價能力——定價並非如此——很大程度上在於不要太高，也不要太低。因為有時候，如果你的價格不準確且價格太高，你實際上可能會損害你的利潤，因為你賣得不夠多。或者如果你的價格低 3 個點，你就會賣出更多的產品，這會提高你的利潤。

So on the gross margin side, we've gotten better at our ability to price. And in the recent years, our transportation team has gotten really agile at managing the expense side. So that's on the gross margin piece. And there's a bunch of other things, but I don't want to give you a 15-minute answer.

因此，在毛利率方面，我們的定價能力有所提高。近年來，我們的運輸團隊在管理費用方面變得非常敏捷。這就是毛利率部分。還有很多其他的事情，但我不想給你 15 分鐘的答案。

On the operating expense side, we focused a lot of energy on people development, on leadership development. Earlier, when I was talking about the transition with Terry, one of the things that always makes me feel good about transition within Fastenal is the incredible bench of talent we have that exists throughout the organization. It's from a promote-within culture.

在營運費用方面，我們將大量精力集中在人員發展和領導力發展上。早些時候，當我與 Terry 談論過渡時，總是讓我對 Fastenal 內部過渡感到滿意的一件事是我們整個組織中擁有令人難以置信的人才庫。它來自於內部晉昇文化。

Because of all that investment, our leadership team, whether it be in a support area, at the district level, at the regional level, our leadership team has never been better. And one thing I'll credit, especially to Casey Miller, who leads our U.S. business; and Jeff Watts, who leads our global business. They both have done an incredible job over the last 5, 6 years of challenging their leaders to be better at managing the expense side. Because in a decentralized organization, there's nothing more difficult than that. You have to be out ahead of stuff. And they've just done a wonderful job on that.

由於所有這些投資，我們的領導團隊，無論是在支援領域、區一級、地區一級，我們的領導團隊從未如此出色。我要歸功於一件事，尤其是領導我們美國業務的凱西‧米勒(Casey Miller)；以及領導我們全球業務的 Jeff Watts。在過去的五、六年裡，他們都做了令人難以置信的工作，要求他們的領導者更好地管理費用方面。因為在一個去中心化的組織中，沒有比這更困難的了。你必須走在前面。他們在這方面做得非常好。

And then the other piece, not to slight anybody, our distribution team and their ability to manage expenses through the cycle is second to none. Sometimes, I look at the information I see, and I click my heels and I'm like, "I can't believe how good this team is." And I think we're just better at it. And that's not about one person, that's about an organization that's gotten better over time.

然後是另一件事，不要輕視任何人，我們的分銷團隊以及他們在整個週期內管理費用的能力是首屈一指的。有時，我看著我看到的信息，然後我就想，“我不敢相信這支球隊有多棒。”我認為我們在這方面做得更好。這不是一個人的事，而是一個隨著時間的推移而變得更好的組織的事。

Our next question is coming from Patrick Baumann from JPMorgan.

我們的下一個問題來自摩根大通的派崔克·鮑曼。

Maybe one for Holden first. Just wanted to follow up on the near-term gross margin expectations. It sounds like the price/cost will be favorable year-over-year in the fourth quarter. And then you also have an easy comp, I think you had called out like weaker product margins last year. Maybe that's the nonfastener business. I guess just given that and your third quarter performance, are you thinking the gross margin in the fourth quarter is going to be up year-over-year? And then can it also be up maybe from the third quarter as well?

也許第一個是霍爾頓的。只是想跟進近期毛利率預期。聽起來第四季的價格/成本將比去年同期有利。然後你也有一個簡單的比較，我想你去年曾經呼籲產品利潤率下降。也許這就是非緊固件業務。我想考慮到這一點和您第三季的業績，您是否認為第四季的毛利率會比去年同期上升？那麼從第三季開始可能也會上升嗎？

No, not up from the third quarter. The -- first off, I think you have a number of things from Q3 to Q4. The first is there is seasonality in play. And I think it's typically, give or take, 30 basis points of seasonality between third quarter and fourth quarter. That's just proven true over time. It relates to the mix of our business in the fourth quarter, et cetera.

不，比第三季還沒有上升。首先，我認為從第三季到第四季有很多事情。首先是遊戲存在季節性。我認為，第三季和第四季之間的季節性變化通常為 30 個基點。隨著時間的推移，這被證明是正確的。這與我們第四季度的業務組合等有關。

And the delevering of our trucking network.

以及我們貨運網絡的去槓桿化。

And the delevering of our trucking network. So I think, first off, you have that sequential headwind.

以及我們貨運網絡的去槓桿化。所以我認為，首先，你會遇到連續的逆風。

Now in the past, I've argued that it might be slightly more muted into Q4, but that was also based on a lot of freight advantage. And I will tell you, in the third quarter, we've begun to see cyclically, sometimes when things get challenging, you can see some of your freight revenue piece begin to soften a little bit. And we saw some of that during the third quarter. And the leverage that you get when you grow the freight revenues reverses when you don't.

過去，我認為進入第四季可能會稍微減弱，但這也是基於許多貨運優勢。我會告訴你，在第三季度，我們開始看到週期性，有時當事情變得具有挑戰性時，你可以看到你的一些貨運收入開始略有軟化。我們在第三季度看到了其中的一些情況。當貨運收入成長時，你所獲得的槓桿作用就會隨著貨運收入的成長而逆轉。

And that was a bit of a challenge at the end of the third quarter that, if that carries into the fourth quarter because demand is still weak, I think that, that goes from something that was doing fantastically for us in Q2 and becomes perhaps a little bit weaker. So I think that plays out perhaps a little bit softer as well. And then I guess I do believe that there'll be some moderation in price/cost.

這在第三季末是一個挑戰，如果這種情況持續到第四季度，因為需求仍然疲弱，我認為，這可能會從第二季度為我們帶來的出色表現變成可能稍微弱一點。所以我認為情況可能也會比較溫和一些。然後我想我確實相信價格/成本將會有所調整。

So I think relative to the third quarter level, I think you're likely to see the fourth quarter come down, a little bit greater-than-normal seasonality in this case.

因此，我認為相對於第三季度的水平，我認為您可能會看到第四季度的下降，在這種情況下，季節性略高於正常水平。

Great. Helpful color. I really appreciate that. And then I got one more in terms of the branch size now. It looks like it's close to that target you laid out in the fourth quarter -- around the fourth quarter conference call, that you said 1,450 for U.S. plus Canada.

偉大的。有用的顏色。我真的很感激。然後我現在又得到了一個關於分支規模的資訊。看起來它接近您在第四季度製定的目標 - 在第四季度電話會議上，您說美國和加拿大為 1,450。

So maybe if you could update us on, is that over now? And then a couple of things in context of that, like how should we think about that sales momentum in the nonresin reseller accounts, which I think has been hurt by some of this consolidation. And then also the occupancy expense account, where I think you've been benefiting from some of that in terms of costs coming out of the business. Thanks for any color on that, I appreciate it.

那麼也許您可以告訴我們最新情況，現在結束了嗎？然後是與此相關的一些事情，例如我們應該如何考慮非樹脂經銷商帳戶的銷售勢頭，我認為這種整合已經損害了非樹脂經銷商帳戶的銷售勢頭。然後還有佔用費用帳戶，我認為您已經從業務成本方面受益。謝謝你的任何顏色，我很感激。

That may be 4 questions.

這可能是 4 個問題。

Yes. I'll try to unpack that in reverse order. And if I missed something, help me out. But first off, branch count, 1,450 is our target number. That's not a, we're at this number, and an edict comes out that says, "Thou shalt not close," or "Thou shalt not open."

是的。我會嘗試以相反的順序解壓縮它。如果我錯過了什麼，請幫助我。但首先，分支數量，1,450 是我們的目標數量。那不是，我們到了這個數字，就會有一條法令出來，上面寫著「你不得關閉」或「你不得開放」。

That number could -- perhaps we should talk in ranges instead of exact points because 1,450 was what our internal team identified as a target number, looking at demographics. And I believe it -- I don't have the stat in front of me, so if I'm wrong, I apologize. It would have been in the flipbook from the first -- from January. But I believe at 1,450, we were within 30 minutes of 93% of the U.S. manufacturing base. And so it's a theoretical number.

這個數字可能——也許我們應該在範圍內而不是精確的點上討論，因為 1,450 是我們內部團隊根據人口統計數據確定的目標數字。我相信這一點——我面前沒有統計數據，所以如果我錯了，我很抱歉。從一月開始，它就會出現在活頁簿中。但我相信，在 1,450 公里處，我們可以在 30 分鐘內到達美國 93% 的製造基地。所以這是一個理論數字。

Could I see it go down to 1,400? Yes. Could I see it go to 1,500? Yes. The closure piece will become ever-quieter. And as we move into 2024, I know just yesterday, I was chatting with Casey and Jeff about some of that and what they're seeing because there's still a few closures on the horizon. Part of it is reminding folks that the openings are okay, too.

我能看到它跌至 1,400 嗎？是的。我能看到它漲到 1,500 嗎？是的。封閉件將變得更加安靜。隨著我們進入 2024 年，我知道就在昨天，我正在與凱西和傑夫談論其中的一些內容以及他們所看到的情況，因為仍有一些即將關閉。部分原因是提醒人們開口也沒問題。

And so I think we'll be in that 1,400, 1,500 range, so don't read anything into it moving up or down 20.

所以我認為我們會在 1,400 到 1,500 的範圍內，所以不要對它上下移動 20 進行任何解讀。

And then since it wraps into the concept, what you will see is, as the rate of closings moderate versus the last several years, you're going to have a little bit less of an incremental sort of take out of costs than we've had over the last several years. We still believe occupancy is ultimately leverageable, but you had inflation at the same time that you've had closures, and those things have tended to offset one another. And that's going to moderate as you go into 2024 and beyond to some degree.

然後，由於它包含在這個概念中，您將看到的是，隨著關閉率與過去幾年相比有所放緩，您的增量成本將比我們少一些在過去的幾年裡。我們仍然相信入住率最終是可以利用的，但在關閉的同時也出現了通貨膨脹，而這些因素往往會相互抵消。進入 2024 年及以後，這種情況將會在某種程度上有所緩解。

So if I look at occupancy in the third quarter, we actually didn't leverage it. And part of the reason for that is, within occupancy, we have 2 components. We have our branch and Onsite network. We have, obviously, our distribution centers. But we also have our FMI, our vending and FASTBin.

因此，如果我看看第三季的入住率，我們實際上沒有利用它。部分原因是，在入住率方面，我們有兩個組成部分。我們有我們的分店和現場網路。顯然，我們有我們的配送中心。但我們也有 FMI、自動販賣機和 FASTBin。

And the reason we classify that as occupancy. When we started vending 15-plus years ago, looked at it and said, a vending machine is basically a shelf. We've taken a shelf out of the branch, we've wrapped it in a metal box, and we put that shelf in a customer's facility. But it's a shelf.

這也是我們將其歸類為佔用率的原因。當我們 15 多年前開始自動販賣時，我們看著它並說，自動販賣機基本上就是一個貨架。我們從分公司取出一個架子，將其包裹在金屬盒中，然後將該架子放在客戶的設施中。但它是一個架子。

And we really challenged our district leaders to think about that as occupancy. In our internal P&L, we classify it as occupancy because if a branch grows from $100,000 to $150,000, and for simple purposes, let's just say that, that $50,000 of growth is all vending. I shouldn't need a bigger building, and my occupancy grows because I have the depreciation and expense associated with my vending platform. And it was a way of more holistically thinking about it.

我們確實向地區領導人提出了挑戰，要求他們將其視為入住率。在我們的內部損益表中，我們將其歸類為佔用率，因為如果一家分店的銷售額從100,000 美元增長到150,000 美元，出於簡單的目的，我們可以這麼說，50,000 美元的增長全部來自自動售貨。我不需要更大的建築，而且我的佔用率會增加，因為我有與我的自動販賣機平台相關的折舊和費用。這是一種更全面地思考它的方式。

Our FMI numbers, as you know, we're signing 95 devices a day. Our FMI grew 6%, our expenses within occupancy. And that was about 55%. So our occupancy grew just under 4%, and about 55% of that related to vending. But even though we closed some branches and closed some locations, our rent has not gotten cheaper in the last 12 months, and we will continue to be challenged with that.

如您所知，我們的 FMI 資料是，我們每天簽署 95 台設備。我們的 FMI 成長了 6%，我們的入住費用。大約是 55%。因此，我們的入住率成長了不到 4%，其中約 55% 與自動販賣有關。但即使我們關閉了一些分行和一些地點，我們的租金在過去 12 個月裡並沒有變得更便宜，我們將繼續面臨挑戰。

One of the things we've talked about on prior calls is the thing we call lift. And lift is about efficiency of where we're picking the product to replenish FMI vending today with FMI more broadly. But it also means -- if I have 50 vending machines out of -- that are serviced out of a branch, and I don't need to stock all of that inventory in the local branch because I'm picking it in an automated distribution center in a highly efficient, way. Now that distribution center isn't free, but I also don't need to expand the footprint of my branch because I freed up 40 feet of shelving that was dedicated to Fast -- to vending in the past.

我們在之前的電話中討論過的事情之一就是我們所說的「電梯」。提升是指我們今天選擇產品來補充 FMI 自動販賣機的效率，更廣泛地使用 FMI。但這也意味著，如果我有 50 台自動販賣機，這些機器是由分支機構提供服務的，而且我不需要在本地分支機構儲存所有庫存，因為我是在自動配送中挑選的以高效的方式集中。現在這個配送中心不是免費的，但我也不需要擴大我的分支機構的佔地面積，因為我騰出了 40 英尺的貨架，這些貨架過去專門用於快速自動售貨。

But it's given us some challenges on the fact that occupancy has grown. And as you can imagine, the further you get from the middle of the country, the more expensive the space gets. And when you get into some of our businesses in Europe, it's more expensive than it is in Winona, Minnesota. But I feel good about our ability over time to continue to manage that and lever it. As I said with our FMI, that business is growing quite handsomely, and we grew our expenses 6%, so we levered that nicely.

但入住率的成長給我們帶來了一些挑戰。正如您可以想像的那樣，距離該國中部越遠，空間就越貴。當你進入我們在歐洲的一些業務時，你會發現它比明尼蘇達州威諾納的價格還要貴。但我對我們隨著時間的推移繼續管理和利用它的能力感到滿意。正如我在 FMI 中所說，業務成長相當可觀，我們的開支增長了 6%，所以我們很好地利用了這一點。

Next question is coming from Tommy Moll from Stephens.

下一個問題來自史蒂芬斯的湯米·莫爾。

I wanted to start on fasteners and ask whether it's possible to parse the down 2% DSR into an MRO versus OEM component. And it's really the OEM side that's the crux of the question. But any context you could give there. And then I'll have one follow-up on OEM.

我想從緊固件開始，詢問是否有可能將下降 2% 的 DSR 解析為 MRO 與 OEM 組件。事實上，OEM 方面才是問題的癥結所在。但你可以在那裡提供任何背景。然後我將對 OEM 進行跟進。

Yes. So what we're seeing in the quarter is you continue to have MRO fasteners down, and we actually had OEM fasteners that were still rising. The perspective you need to have, though, is we continue to see our OEM fasteners grow as a proportion of the mix because they tend to benefit from the growth in our Onsite. So today, a lot of our growth is coming through Onsites, and therefore, a lot of those innings, those new implementations also bring in OEM fasteners.

是的。因此，我們在本季看到的是 MRO 緊固件繼續下降，而我們實際上 OEM 緊固件仍在上升。不過，您需要看到的是，我們繼續看到我們的 OEM 緊固件在組合中所佔的比例不斷增長，因為它們往往會從我們現場的增長中受益。因此，今天，我們的大部分成長都是透過現場實現的，因此，在許多局中，這些新的實施也帶來了 OEM 緊固件。

And so in the past, we've talked about OEM, and I think people have been surprised that OEM hasn't gotten negative given sort of the behavior. But if you go back to like mid last year, OEM fasteners were growing mid-20s. If you come to current period, it's growing low single digits. And so you've seen significant moderation in OEM fasteners as the production environment has softened over the past 12 months, but it's still growing because of the success we continue to have signing and implementing Onsites.

因此，在過去，我們討論過 OEM，我認為人們很驚訝 OEM 並未因這種行為而受到負面影響。但如果你回到去年中期，OEM 緊固件的成長速度在 20 多歲左右。如果你看看當前時期，它的成長速度很低。因此，隨著過去 12 個月生產環境的疲軟，您可以看到 OEM 緊固件的數量顯著放緩，但由於我們繼續成功簽署和實施現場協議，其數量仍在增長。

That's helpful. I guess to keep going with the same theme. Some of the commentary you've offered today on the OEM side has sounded similar to recent quarters. And recently, you talked about the destocking dynamic at customer locations, particularly for the OEM business. Is there anything you can do to parse real underlying demand there versus shorter product delivery cycles, and maybe customers are just ordering later in their production cycle?

這很有幫助。我想繼續保持相同的主題。您今天在 OEM 方面提供的一些評論聽起來與最近幾季相似。最近，您談到了客戶所在地的去庫存動態，特別是 OEM 業務。您可以做些什麼來解析那裡真正的潛在需求與較短的產品交付週期，也許客戶只是在生產週期的後期訂購？

Yes. If you think about what we do in a perfect world, where we're supplying OEM fasteners, the customer isn't ordering it per se. We're supplying it when they need it. And that shouldn't change depending on the cycle. The question is, if you peer downstream from the manufacturing activity to the -- to our customer or their supply chain to the end market, how much inventory is there? Because if -- there shouldn't be a different stage of where you're ordering OEM fasteners.

是的。如果您考慮我們在完美世界中所做的事情，即我們提供 OEM 緊固件，那麼客戶本身並不是在訂購它。我們會在他們需要時提供。這不應該根據週期而改變。問題是，如果你從製造活動的下游觀察到我們的客戶或他們的供應鏈到最終市場，有多少庫存？因為如果 - 您訂購 OEM 緊固件的階段不應該存在不同的階段。

The pull-through is what the pull-through is. Now some of the changes from what Holden talked about a year ago, there was elements of inflation in there. But there was also elements of folks had such an unstable supply chain for everything else. Fortunately, they were partnered with Fastenal, and their supply chain for fasteners was great. And I'm having a little fun with you there.

拉通就是拉通。現在霍爾頓一年前談到的一些變化，其中有通貨膨脹的因素。但也有一些因素是人們對其他一切的供應鏈都不穩定。幸運的是，他們與 Fastenal 合作，他們的緊固件供應鏈非常好。我和你在那裡玩得很開心。

But they might have had other stuff, or their end markets, possession is 9/10 of the law, and so they just ordered it because they were worried about getting it. And so I think you do have cases of, downstream from our manufacturer customers, there's some stuff that piled up. But I think that's worked through. I think the pull right now is the pull.

但他們可能有其他東西，或者他們的終端市場，佔有是法律的 9/10，所以他們只是訂購它，因為他們擔心得到它。所以我認為確實有這樣的情況，在我們的製造商客戶的下游，有一些東西堆積起來。但我認為這已經解決了。我認為現在的拉力就是拉力。

I was talking with our leader in Continental Europe the other day, and his business had ticked up, and I was just asked them some components about it. And he was talking about some of these transportation customers that had picked up. He said their businesses is pulling through what they're selling, but they're being very, very cautious about not getting ahead of anything. So I think there, it's just true demand coming through.

前幾天我正在與我們歐洲大陸的領導人交談，他的業務有所增長，我只是向他們詢問了一些相關內容。他正在談論一些已經增加的運輸客戶。他說，他們的企業正在努力完成他們所銷售的產品，但他們非常非常謹慎，不會超前。所以我認為這只是真正的需求。

Yes. Maybe another anecdote as well. At the end of any given year, particularly years where demand is poor, oftentimes, we get suppliers that approach us to say, "Hey, we sold just something for a discount. Would you take some of this stuff off our hands, so we can normalize our own production rates?" And that's fairly typical.

是的。也許還有另一件軼事。在任何一年的年底，特別是需求疲軟的年份，我們經常會收到供應商來找我們說：「嘿，我們只是打折出售一些東西。您能從我們手中拿走一些東西嗎？這樣我們就可以了。”能讓我們自己的生產力正常化嗎？”這是相當典型的。

And I'll say that -- the -- it's still early, and we don't know what December is going to look like in many respects. But we haven't seen as much activity from our suppliers inquiring about our willingness to enter into those kind of sort of year-end types of deals. And what that might suggest to you is that a lot of our suppliers might have inventories that are pretty close to where they need to be.

我想說的是——現在還很早，我們不知道 12 月在很多方面會是什麼樣子。但我們還沒有看到我們的供應商有太多活動詢問我們是否願意進行此類年終交易。這可能向您表明，我們的許多供應商的庫存可能非常接近他們需要的庫存。

Those are anecdotes. We're not even in November, December yet. But I'm probably feeling somewhat encouraged about where the inventory levels within and throughout our supply chain are getting to.

這些都是軼事。我們還沒到十一月、十二月。但我可能對我們供應鏈內部和整個供應鏈的庫存水準感到有些鼓舞。

Next question is coming from Ryan Merkel from William Blair.

下一個問題來自威廉·布萊爾的瑞安·默克爾。

I had a couple of questions on gross margin. So usually, gross margins kind of flat sequentially into 3Q. And obviously, it was up 40 bps. Can you just unpack what the drivers are there? Just because that was the surprise factor.

我有幾個關於毛利率的問題。因此，通常情況下，毛利率在第三季會連續持平。顯然，它上漲了 40 個基點。你能解壓裡面的驅動程式嗎？只是因為那是令人驚訝的因素。

Yes. As I indicated in my preamble, mix wasn't quite the headwind that I expected it was going to be. And price/cost was more of a tailwind than I expected it to be relative to the guidance that I gave at the Q2 call. Those are the 2 pieces.

是的。正如我在序言中指出的那樣，混合併不完全是我預期的逆風。相對於我在第二季電話會議上給予的指導，價格/成本比我預期的更有利。這是 2 件。

And when you say price/cost, you're talking on product, you're talking on freight? Because it sounds like freight was the thing that you mentioned first driving the gross margin.

當您說價格/成本時，您是在談論產品，還是在談論運費？因為聽起來貨運是您首先提到的推動毛利率的因素。

Yes. But in many cases, freight rolls into our product cost, right? The biggest reason why there's been inflation and deflation over the past 3 or 4 years isn't the cost of steel. There's a bit of that. It has a lot more to do with what the cost of moving product has been. So the price/cost in our -- when we talk about price/cost, in many cases, elements of freight are moved into our product price.

是的。但在很多情況下，運費會計入我們的產品成本，對嗎？過去三、四年通貨膨脹和通貨緊縮的最大原因不是鋼鐵成本。有一點這樣的。它與行動產品的成本有很大關係。因此，當我們談論價格/成本時，在許多情況下，運費的要素會被轉移到我們的產品價格中。

Yes, because we consider that our landed cost to the shelf, as opposed to when we're moving it around North America or moving it around in our business.

是的，因為我們考慮到貨架的到岸成本，而不是我們在北美或在我們的業務中移動它時的成本。

Now there's transportation that does not fall into product costs. Those are our Ram trucks in the field, et cetera. But when you're talking about the cost of moving things from overseas to domestic, that goes into product cost. As Dan said, it's part of landed, and that gets reflected in our price/cost dynamics.

現在，運輸不屬於產品成本。這些是我們在現場的公羊卡車等。但是，當您談論將物品從海外轉移到國內的成本時，這會涉及產品成本。正如丹所說，這是到岸的一部分，這反映在我們的價格/成本動態中。

Got it. Okay. That's helpful. And then sequentially, you think maybe gross margin could come down a little bit more than seasonality. Is that because price/cost is going to decline, and the reason there, you're going to lower fastener prices to match the lower product costs? Or is it also this idea that maybe charging for freight is getting a little bit harder?

知道了。好的。這很有幫助。然後，您認為毛利率可能會比季節性下降更多。這是因為價格/成本將會下降，並且您將降低緊固件價格以匹配較低的產品成本嗎？或者說，這也是運費收費變得有點困難的想法嗎？

No. I mean, there's a few reasons why I think gross margin will come in a bit. One of it is the seasonality you talked about. The second thing I talked about a moment ago was simply freight revenues has softened a little bit in the face of a weaker cycle. And again, we have a certain degree of leverage around our freight that works great when the freight revenues are at record levels, and it's not quite as good when they're not. That's another element of it.

不，我的意思是，我認為毛利率會上升有幾個原因。其中之一就是你談到的季節性。我剛才談到的第二件事是，面對疲軟的週期，貨運收入略有下降。再說一次，我們對貨運有一定程度的槓桿作用，當貨運收入達到創紀錄水平時，這種槓桿作用非常好，而當貨運收入處於創紀錄水平時，它就不太好。這是它的另一個要素。

And then the moderation in price/cost that I anticipate is probably has more to do with the field continuing to make modest adjustments where they're required by contract or what have you to do so. And again, we're talking about a relatively small number here. It's not dramatic. But those are the moving pieces that I see playing out to a slightly weaker fourth quarter gross margin relative to third.

然後，我預計價格/成本的緩和可能更多地與該領域繼續根據合約要求或您必須這樣做的情況進行適度調整有關。再說一次，我們在這裡討論的是相對較小的數字。這並不戲劇性。但我認為這些因素會導致第四季的毛利率略低於第三季。

Thanks, Ryan. I see it's about 2 minutes before the hour, and I realize everybody on this call has a busy week of earnings conversations to be engaged in. Thank you for your time. Good luck in the fall. And my thanks to the Fastenal team. Have a good day, everybody.

謝謝，瑞安。我看到現在是整點前 2 分鐘，我意識到參加這次電話會議的每個人都忙於一周的收益對話。感謝您抽出寶貴的時間。祝秋天好運。我還要感謝 Fastenal 團隊。祝大家有美好的一天。

Thank you, everyone.

謝謝大家。

Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.

謝謝。今天的電話會議和網路廣播到此結束。此時您可以斷開線路並度過美好的一天。我們感謝您今天的參與。