快扣 (FAST) 2019 Q2 法說會逐字稿

Greetings. Welcome to the Fastenal Company Second Quarter 2019 Earnings Results Conference Call. (Operator Instructions) Please note, this conference is being recorded.

問候。歡迎參加 Fastenal 公司 2019 年第二季收益業績電話會議。（操作員說明）請注意，本次會議正在錄音。

I would now like to turn the conference over to Ellen Stolts, Investor Relations. Ms. Stolts, you may now begin.

現在我將把會議交給投資者關係部的艾倫·斯托爾茨。斯托爾茨女士，您可以開始了。

Welcome to the Fastenal Company 2019 Second 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 2019 年第二季財報電話會議。本次電話會議將由我們的總裁兼執行長丹·弗洛內斯和我們的財務長霍爾頓·劉易斯主持。電話會議將持續最多 1 小時，首先將對我們的季度業績和營運情況進行總體概述，剩餘時間將用於提問和解答。

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 September 1, 2019, at midnight Central Time.

今天的電話會議是 Fastenal 的專有演示，並由 Fastenal 進行錄音。未經 Fastenal 同意，不得對今天的通話進行任何錄音、複製、傳輸或分發。本次電話會議將透過 Fastenal 投資者關係主頁 investor.fastenal.com 在網路上進行音訊同步直播。網路直播的回放將在網站上提供，直至2019年9月1日中部時間午夜。

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.

提醒各位，今天的電話會議可能涉及公司未來的計劃和前景。這些聲明是基於我們目前的預期，我們不承擔更新這些聲明的義務。值得注意的是，公司的實際業績可能與預期業績有重大差異。可能導致實際結果與預期結果不同的因素已包含在公司最新的收益報告和定期向美國證券交易委員會提交的文件中，我們建議您仔細閱讀這些因素。

I would now like to turn the call over to Mr. Dan Florness.

現在我將把電話交給丹‧弗洛內斯先生。

Thank you, Ellen, and good morning, everybody. Before I start, I just want to share a thought with the group. And I had the distinct pleasure over my 23 years at Fastenal to have worked with some really fine people. And 2 of them I'll mention are our original CEO, Bob Kierlin, and his successor, Will Oberton, 2 individuals that I think were stellar in the role, and I learned a tremendous amount from and not only were they great at their role, they're really good people. I remember back in, I believe it was 1998 October, and our business growth dropped in 1 month about 1/3, we went from 20-some percent growth, we dropped 10 point, I think we went from 27% to 17%, don't quote me on that, but I think that's what it was.

謝謝你，艾倫，大家早安。在開始之前，我想先跟大家分享一下我的想法。在 Fastenal 工作的 23 年裡，我非常榮幸能與一些非常優秀的人共事。其中兩位我要特別提及，他們分別是我們的首任執行長鮑勃·基爾林和他的繼任者威爾·奧伯頓。我認為他們兩人在這個職位上表現非常出色，我從他們身上學到了很多。他們不僅工作能力強，而且人品也非常好。我記得大概是 1998 年 10 月，我們的業務成長在一個月內下降了大約三分之一，成長率從 20% 左右下降了 10 個百分點，我想是從 27% 降到了 17%，別引用我的話，但我想應該是這樣。

And we did 6 simple things. And if you want to -- if you're a CEO out there and you want to know 6 things to do at a time like this, these are really useful. The first thing you do is you take a step back, you revisit your long-term priorities. These priorities should center on your goals or something's wrong to start with, but you take a look at your priorities. And that's step 1.

我們做了6件簡單的事。如果你是一位CEO，想知道在這種時候應該做的6件事，那麼這些真的很有用。首先，你要做的就是退後一步，重新審視你的長期優先事項。這些優先事項應該圍繞著你的目標展開，否則一開始就出了問題，但你應該審視一下你的優先事項。這是第一步。

Step 2 is you remind everybody about these priorities and you remind everybody, hey, we keep doing these things. 20 years ago, that was opening branches because we were spreading across North America. Today, it's executing on our growth drivers.

第二步，你要提醒大家這些優先事項，並提醒大家，嘿，我們要繼續做這些事。20年前，我們開設分公司是因為我們正在向北美擴張。今天，它正在執行我們的成長驅動策略。

Step 3, you take a step back and you identify those things that are really, really important to your long-term success. But you pull back on that a bit, and you explain to everybody why. And a good example of something that we were pulling back, back in late May, I sat down with Reyne Wisecup, our Head of HR; and Peter Guidinger, our Head of our Fastenal School of Business, and I said, "You know what? We need to pull back expenses and we need to do it in a bunch of places." We need to pull back our instructor-led programs for the second half of the year because we need to pull back the travel expenses, so if you're an airline right now or a hotel in Winona, Minnesota where one of our distribution centers, you will lose some business in the next 6 months because we pulled back on about -- we pulled back about 40% of our online -- or, excuse me, our instructor-led trainings.

第三步，退後一步，找出對你的長期成功真正重要的那些事。但你要稍微收斂一些，並向大家解釋原因。一個很好的例子是，在五月下旬，我們開始撤回一些措施。當時我與我們的人力資源主管雷恩·懷斯卡普 (Reyne Wisecup) 和我們的 Fastenal 商學院院長彼得·吉丁格 (Peter Guidinger) 坐下來，我說：「你們知道嗎？我們需要削減開支，而且需要在很多方面都這樣做。 「我們需要削減下半年的講師指導課程，因為我們需要削減差旅費用。所以，如果您現在是航空公司，或者明尼蘇達州威諾納市（我們其中一個配送中心所在地）的酒店，那麼在接下來的6個月裡，您將會損失一些生意，因為我們削減了大約40%的在線培訓——或者，抱歉，是講師指導的培訓。

And the team didn't react with anger, didn't react with fear. They reacted with resiliency. And -- now, maybe they had some fear in their stomach, maybe they had some anger in their stomach, but they didn't let that show and they immediately identified, with some of the resources they would be freeing up, what could they do that helps Fastenal in the short term and long term. And they identified some courses they're going to develop because most of our courses are delivered online.

而球隊並沒有表現出憤怒，也沒有表現出恐懼。他們展現出了極強的韌性。現在，他們或許內心有些恐懼，或許內心有些憤怒，但他們沒有表現出來，而是立即意識到，利用他們即將釋放的一些資源，他們可以做些什麼來幫助 Fastenal 在短期和長期發展。他們確定了一些即將開發的課程，因為我們的大部分課程都是在線上授課的。

We identified an abrasives course, a metalworking course, a blueprint reading course, ISO quality course, several new courses relating to Lean and Six Sigma. Now my guess is there aren't anybody on this call that's signing up to take those courses, but they are really important to our employees and to our customers. And that's something that you do when you do trade-offs and you pull back expenses in the short term. Really important thing as an organization or individual, in the case of me, that believes in education more, but in the short term, you pull back because we don't have the dollars to pay for it.

我們確定了磨料加工課程、金屬加工課程、藍圖識讀課程、ISO品質課程以及幾門與精益生產和六西格瑪相關的新課程。我猜想這次電話會議中沒有人會報名參加這些課程，但這些課程對我們的員工和客戶來說都非常重要。這就是你在權衡利弊、短期內削減開支時會做的事情。對於一個組織或個人來說，這確實是一件非常重要的事情，就我而言，我更相信教育，但在短期內，我們不得不退縮，因為我們沒有足夠的資金來支付教育費用。

Step 4, you have to also identify those activities that don't support your long-term priorities or that, quite frankly, aren't really that necessary in the first place. Fortunately, for us, we're pretty frugal. So we don't have many of those, but we are human beings, so we -- you always develop some and those you just stop and you stop today.

第四步，你還必須找出那些不支持你的長期優先事項的活動，或者坦白地說，那些一開始就不是真正必要的活動。幸運的是，我們家比較節儉。所以我們沒有很多這樣的習慣，但我們是人，所以我們──你總是會發展出一些習慣，而有些習慣你只是停止了，今天就停止了。

The third thing you do is you communicate this throughout the organization. You create normalcy in your organization. You remove fear and replace it with resiliency.

第三件事是將這一點傳達給整個組織。你為你的組織創造正常秩序。你消除恐懼，代之以韌性。

And then step 6, you repeat that communication to everybody and you repeat it again and again. And you build resiliency in the organization.

然後，在步驟 6 中，你要把這個訊息重複給所有人，一遍又一遍地重複。這樣可以增強組織的韌性。

Six really simple steps, but they're really effective, in a time when all of a sudden your business has slowed down and you're not sure how long. I feel comfortable we're taking market share, but the business has slowed down.

六個非常簡單的步驟，但卻非常有效，尤其是在你的業務突然放緩，而你又不確定這種情況會持續多久的時候。我覺得我們正在逐步擴大市場份額，但業務成長速度已經放緩。

I had a call with our regional VPs at 7 this morning. Actually, Holden did. I chimed in at the tail end of it. I talked to them about a number of things we're doing right. I also talked about them on aspects of the quarter that don't fall into normalcy where our execution faltered. And gross margin is one that stands out.

今天早上7點，我和我們各區域的副總裁們通了電話。實際上，霍爾頓確實這麼做了。我在最後插話了。我跟他們談了我們做得對的幾件事。我還談到了本季度中一些不符合常規的情況，以及我們在執行方面出現的失誤。毛利率尤其突出。

To be honest with you, last fall, we thought we had a really good plan to address some of the inflation we were seeing in the -- there's been tariffs now in place on steel-based products for a year, on fasteners since late last fall. And felt we had a really good plan coming into the year how to approach it. I often encourage our team to think big about the business. Unfortunately, on that front, I fell shy on where we were last fall in that we had a good plan coming into the year, we didn't have a great plan, and part of the -- where we faltered was the resiliency part. We didn't prepare our team for a bunch of things coming their way.

坦白說，去年秋天，我們認為我們有一個非常好的計劃來解決我們當時看到的通貨膨脹問題——鋼鐵產品關稅已經實施一年了，緊固件關稅從去年秋末開始實施。我們覺得年初的時候就已經制定了一個很好的計畫來應對這種情況。我經常鼓勵團隊成員從宏觀的角度思考業務問題。遺憾的是，在這方面，我比去年秋天的情況要好得多，因為我們年初制定了一個不錯的計劃，但我們並沒有一個完美的計劃，而我們失敗的部分原因在於韌性方面。我們沒有讓團隊做好應對即將面臨的許多事情的準備。

We prepared them for that big wave coming in, was tariffs that were direct. That's an easy one to identify, that's an easier one to go after. It's not easy to take it downstream, no pun intended, but it is easier to go after. We also prepared them for some of the things that would be coming from our suppliers in the U.S. that import product and resell it to us. Not as easy to identify, but relatively easy. And I think on those 2 fronts, we did a relatively good job. We realized in the process, we were going to share some of it with our customers. We were going to share some of it with ouselves. We are a supply chain partner. Our customer is not a means to an end for us. Our customer -- we're not a business that just sells products and the customer goes away, and we don't really care what they do with it. We are a supply chain partner, and that's what we represent to our customer.

我們讓他們做好了應對即將到來的巨大衝擊的準備，那就是直接關稅。那很容易識別，也更容易追蹤。順流而下並不容易（此處並無雙關之意），但追擊起來卻容易得多。我們也讓他們了解了美國供應商的一些情況，這些供應商進口產品並轉售給我們。雖然不容易識別，但相對容易。我認為在這兩方面，我們做得都比較好。在這個過程中，我們意識到，我們將與客戶分享其中的一些內容。我們原本打算和自己分享一部分。我們是供應鏈合作夥伴。對我們來說，客戶不是達到目的的手段。我們的客戶－我們不是那種只賣產品，然後客戶就走了，我們也不在乎他們怎麼用產品的公司。我們是供應鏈合作夥伴，這就是我們對客戶的定位。

Where we failed though is, there wasn't just a couple of waves coming in, there was a bunch of riptides too. And those riptides came from a bunch of different directions, and we weren't ready for that. And as a result, and Holden will touch on a little more detail about that, we lost some gross margin. To me, that's the thing that stands out in this quarter that is troubling from the standpoint if the economy slows down, the economy slows down; if the economy expands, the economy expands, you react to both.

但我們失敗的地方在於，來襲的不僅是幾波巨浪，還有許多離岸流。而這些離岸流來自四面八方，我們毫無防備。因此，霍爾頓稍後會更詳細地談談這一點，我們損失了一些毛利率。在我看來，本季最令人擔憂的一點是，如果經濟放緩，經濟就會放緩；如果經濟擴張，經濟就會擴張，你需要對這兩種情況做出反應。

We did not execute on gross margin. And as a result, a statement I made to this group, I believe it was back on the January call, where I said, when I look at Fastenal, and I'm describing it to our folks internally, when we're a $10 billion company, I believe a 46% gross margin is a reality that we can achieve. I believe a 24% operating expense is a reality we can achieve, and we should aspire to an operating margin around 22%. I believed it then, I believe it now. I didn't think I'd be sitting here 6 months later talking to you about a quarter where we just put up a gross margin that's 46-and-change, 46.7% I believe is the number. And in that regards, we have some work to do as we go into Q3.

我們沒有實現毛利率目標。因此，我曾在1月份的電話會議上向這個團隊發表過聲明，當時我說，當我審視Fastenal，並向我們內部員工描述時，當我們成為一家市值100億美元的公司時，我相信46%的毛利率是我們能夠實現的現實。我認為 24% 的營運費用是我們可以實現的，我們應該力爭 22% 左右的營運利潤率。我當時相信，現在也相信。我沒想到6個月後我會坐在這裡和你談論我們剛剛實現的46%多一點的毛利率，我相信是46.7%。在這方面，我們進入第三季後還有一些工作要做。

I'll go to now the flipbook. The sales growth slowed to about 8%, it's our first sub-10% reading in 9 quarters. We continued to realize double-digit growth through vending and Onsites and our National Account customers, our growth drivers, if you will. Our fourth growth driver, construction, did weaken as we got deeper into the quarter. Not exactly sure what's driving all of that at this time. But overall, our activity in the end markets we serve slowed as we stepped into the quarter. I don't know if it continued to slow during the quarter, but it did slow as we stepped into the quarter, and I'll let Holden touch more on that in a few minutes.

我現在要去看翻頁書了。銷售成長放緩至約 8%，這是我們 9 個季度以來首次低於 10% 的成長速度。我們透過自動販賣機、現場服務和全國客戶（也就是我們的成長動力）繼續實現兩位數成長。隨著季度深入，我們的第四大成長動力——建築業——減弱。目前還不太清楚這一切背後的驅動因素。但總體而言，隨著我們進入本季度，我們在所服務的終端市場的業務活動有所放緩。我不知道本季是否繼續放緩，但進入本季後確實放緩了，稍後我會讓霍爾頓就此做更多說明。

There were a few milestones in the quarter, and one that occurred right after the quarter that I'll touch on as well. The first milestone was we installed our 100,000th, that's a hard thing to say, vending device during the quarter. We have a little over 85,000 vending machines now, we have another 15,000 that we lease to some customers where they use them for check-in, check-out, so 100,000 of them out there.

本季出現了一些里程碑事件，還有一個發生在季度末之後的事件，我也會談到。第一個里程碑是，我們在本季安裝了第 10 萬台自動販賣機，這很難說出口。我們現在有 85,000 多台自動販賣機，另有 15,000 台租賃給一些客戶，供他們辦理入住和退房手續，所以總共有 100,000 台自動販賣機。

I'd like to personally thank Oshkosh Corp and specifically their Pierce Manufacturing facility in Appleton, Wisconsin. They were an early adopter, I should say an early guinea pig, with our vending program back 11, 12 years ago, continue to have a great relationship with that organization and they added machine number 100,000 in early June. And I had the opportunity to go over there and thank them in person. It worked out really well because they're based in Appleton, Wisconsin, my father-in-law, Gus, lives about 10 miles away in Neenah, so I had a -- I didn't need to get a hotel that night. But I had a chance to learn a bit about their business, and what they do is petty special, they make fire trucks, a beautiful product.

我謹代表個人感謝奧什科甚公司，特別是位於威斯康辛州阿普爾頓的皮爾斯製造工廠。他們是我們的自動販賣機項目的早期採用者，應該說是早期試驗者，早在 11、12 年前就參與了我們的項目，我們一直與該組織保持著良好的關係，他們在 6 月初增加了第 10 萬台機器。我有機會親自去那裡感謝他們。這真是太好了，因為他們公司位於威斯康辛州阿普爾頓，而我的岳父格斯住在離那裡大約 10 英里的尼納，所以我那天晚上不需要住酒店。但我有機會了解了一些他們的業務，他們所做的事情非常特別，他們製造消防車，這是一款很棒的產品。

Late in the quarter, we signed Onsite number 1,000. I think that's a big accomplishment. It took us quite a few years to get to branch number 1,000. It took us a lot less time to get to Onsite 1,000. I'm not at liberty to share with you the name of that customer right now. I believe we're announcing it in a day or 2. We need to get all the formalities worked out, but I'd like to thank them incognito for Onsite 1,000. I think we're at 1,026 right now.

本季末，我們簽下了第 1000 份現場服務合約。我認為這是一項了不起的成就。我們花了相當長的時間才達到第 1000 家分行。我們用時很短就達到了 Onsite 1,000。我現在不方便透露那位客戶的姓名。我相信我們會在一兩天內宣布這件事。我們需要把所有手續都辦妥，但我還是要匿名感謝他們舉辦了 Onsite 1,000 活動。我認為我們現在是 1026。

A third milestone occurred, it's not in the flipbook, but yesterday, and it wasn't even in the quarter. Yesterday, our facility in Connecticut, Wallingford, Connecticut, Holo-Krome, back in 2009, we acquired Holo-Krome. They were in the business -- the process of being shut down. Within 2 years of the acquisition, we moved them from an 80-year old facility that was rather tired into a newly renovated facility. And -- but Holo-Krome Manufacturing started back in 1929, kind of an odd year to start given what happened in the next decade. But they celebrated 90 years of operation yesterday. My congratulations to the team at Holo-Krome. They've been a great addition to the Fastenal family.

第三個里程碑事件發生了，它沒有記錄在冊，但就在昨天，而且它甚至不在本季度內。昨天，我們位於康乃狄克州沃靈福德的工廠 Holo-Krome，早在 2009 年，我們就收購了 Holo-Krome。他們當時正處於被關閉的過程中。收購後兩年內，我們將他們從一個已有 80 年歷史、相當破舊的設施搬遷到了一個新裝修的設施。但是——Holo-Krome Manufacturing 公司成立於 1929 年，考慮到接下來十年發生的事情，這是一個有點奇怪的開始。但他們昨天慶祝了成立90週年。向Holo-Krome團隊表示祝賀。他們的加入為 Fastenal 大家庭增添了強大的力量。

Price realization, as I've alluded to, has been insufficient to fully offset the tariffs and general inflation we're seeing. We're seeing it in a bunch of fronts. Obviously, the direct impact of tariffs, but the indirect through companies we buy from, some pass it on in different ways, some spread it across all products, some apply it strictly to tariff-related products. Nonetheless, it's created a lot of supply chain inflation. In the short term, we've not been able to realize the price to fully pass that along. We have taken further price adjustments going into the third quarter. We will, as a supply chain partner, share some with our customer, we'll absorb some of it, but we plan to claw back the gross margin degradation that came beyond just customer mix in the current quarter.

正如我之前提到的，價格上漲不足以完全抵消關稅和我們所看到的普遍通貨膨脹。我們在很多方面都看到了這種情況。很明顯，關稅會產生直接影響，但透過我們購買商品的公司，也會產生間接影響。有些公司以不同的方式轉嫁關稅，有些公司將關稅分攤到所有產品上，有些公司則嚴格應用於與關稅相關的產品。然而，這也造成了供應鏈通膨。短期內，我們還沒能達到足夠的價格，將成本完全轉嫁給消費者。進入第三季度，我們進一步調整了價格。作為供應鏈合作夥伴，我們將與客戶分擔一部分損失，我們將承擔一部分損失，但我們計劃彌補本季度除客戶組合變化之外的其他因素造成的毛利率下降。

As a result, we struggled to obtain leverage. We did get operating expense leverage. The flipbook talks about that. I -- the only disagreement I'd have with the flipbook is that's looking at operating expense to sales growth. I think of operating expense to gross profit dollar growth. And in that regard, we did not lever. But I think the team did a good job of managing operating expenses in the second quarter. We are dialing them down as we go into the third.

因此，我們很難獲得談判籌碼。我們確實獲得了營運費用槓桿效應。這本翻頁書裡講到了這一點。我——我對翻頁書唯一不同意的地方是，它關注的是營運費用與銷售成長之間的關係。我考慮的是營運費用與毛利的美元成長率。在這方面，我們沒有利用槓桿。但我認為團隊在第二季對營運費用的控制方面做得很好。進入第三節，我們將逐漸降低強度。

On the next page, I don't need to read these all individually. What I can say as it relates to our growth drivers, the team did a great job continuing to take market share. We just need to continue to do a great job on executing the business.

下一頁的內容我不需要逐一閱讀。就我們的成長動力而言，我可以說團隊在持續擴大市場份額方面做得非常出色。我們只需要繼續出色地執行業務。

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

這樣，我就把麥克風交給霍爾頓了。

Great. Thank you, and good morning. Before jumping in, I just want to remind everyone that on May 22, we split our stock 2 for 1. Therefore, any references in the materials to per-share information such as EPS will reflect this action.

偉大的。謝謝，早安。在正式開始之前，我想提醒大家，5月22日我們進行了1拆2的股票分割。因此，資料中任何提及每股資訊（例如EPS）的內容都將反映此一變動。

Moving to Slide 5. Total sales were up 7.9%, which includes up 7% daily sales in June. Pricing in response to tariffs and general inflation contributed 70 to 100 basis points during the period. It's a lower range than what we saw in the first quarter. That largely reflects the current period having to grow over last year's rising contribution from price. Sequentially, we believe price realization was stable.

切換到第 5 張投影片。總銷售額成長了 7.9%，其中包括 6 月每日銷售額成長 7%。在此期間，受關稅和整體通貨膨脹的影響，價格上漲了 70 至 100 個基點。這比我們第一季看到的幅度要低。這主要反映了當前時期必須超越去年價格上漲帶來的成長。從順序上看，我們認為價格實現保持穩定。

From a macro standpoint, it's clear that activity slowed. The Purchasing Managers' Index averaged 52.2 in the first quarter, which is still suggestive of a growing market, but well off the 56.9 level recorded as recently as the fourth quarter. Similarly, U.S. industrial production in April and May was up 1.3%, which is well below the 3.7% growth that we experienced just in the fourth quarter of 2018. There's no panic in the market, and the month-to-month cadence through the quarter was mostly steady, but sentiment has become more cautious. In terms of end markets, manufacturing was up 9.1%, oil and gas remains soft, and our heavy equipment categories also slowed. Construction was up 7.2% in the second quarter with larger customers outperforming smaller ones.

從宏觀角度來看，經濟活動明顯放緩。第一季採購經理人指數平均為 52.2，這仍然表明市場正在成長，但遠低於第四季度創下的 56.9 的水平。同樣，美國 4 月和 5 月的工業生產成長了 1.3%，遠低於 2018 年第四季 3.7% 的成長率。市場並未出現恐慌，本季各月走勢基本穩定，但市場情緒變得更加謹慎。從終端市場來看，製造業成長了 9.1%，石油和天然氣產業依然疲軟，我們的重型設備類別也放緩了。第二季建築業成長了7.2%，其中大型客戶的表現優於小型客戶。

From a product standpoint, fasteners were up 5.5% with non-fasteners up 9.5%. Fasteners are the most cyclical of our product lines, and we believe the relatively faster deceleration from 1Q to 2Q likely reflects the slower macro environment.

從產品角度來看，緊固件上漲了 5.5%，非緊固件上漲了 9.5%。緊固件是我們產品線中週期性最強的產品，我們認為從第一季到第二季增速相對放緩可能反映了宏觀環境的放緩。

From a customer standpoint, National Accounts were up 12.5% in the quarter, with 72 of our top 100 accounts growing. Our non-National Account growth was less than 1%, with roughly 59% of our branches growing in the second quarter.

從客戶角度來看，本季全國性客戶的銷售額成長了 12.5%，前 100 名客戶中有 72 名實現了成長。我們的非國民帳戶成長率不到 1%，第二季約有 59% 的分公司實現了成長。

After 8 quarters where quarterly growth averaged 12.9%, our current rate is clearly disappointing. Still, ebbs and flows of the cycle aside, the goal every day is to capture more market share of a fragmented industrial distribution market. Judging by our outgrowth relative to industrial production, we believe the Blue Team continues to execute its growth drivers effectively.

此前 8 個季度平均成長率達到 12.9%，而我們目前的成長率顯然令人失望。撇開週期的起伏不談，每天的目標都是在分散的工業分銷市場中搶佔更多市場份額。從我們相對於工業生產的成長速度來看，我們相信藍隊繼續有效地執行其成長驅動因素。

Now to Slide 6. Our gross margin was 46.9% in the second quarter, down 180 basis points versus the second quarter of 2018, a larger decline than was expected. There were a handful of smaller drags, including the year-to-year comparison in transportation. But there were 2 primary factors behind the decline: First, customer and product mix. This remains an expected outcome of our success in driving market share gains through our current growth drivers. However, the greater deceleration in our higher-margin non-National Account customers, which grew less than 1% in the quarter, served to widen that mix drag, which was 80 to 90 basis points in the quarter.

現在來看第 6 張投影片。我們第二季的毛利率為 46.9%，比 2018 年第二季下降了 180 個基點，降幅比預期更大。還有一些較小的拖累因素，包括交通運輸領域的年度比較。但下滑背後有兩個主要因素：首先是顧客和產品組合。這仍然是我們透過當前成長動力推動市場佔有率成長的預期結果。然而，我們利潤率較高的非全國性客戶的成長速度明顯放緩，本季成長不到 1%，這加劇了這種組合拖累，本季拖累幅度達到 80 至 90 個基點。

Second was a widening in our price cost deficit to an estimated 40 to 60 basis points. As Dan alluded to, initial steps to raise price to offset tariffs were effective as far as they went, but were not expansive enough in terms of the range of products covered or their ability to offset generalized inflation above and beyond and, frankly, catalyzed by the tariffs.

其次，我們的物價成本赤字擴大到估計 40 至 60 個基點。正如丹所暗示的那樣，提高價格以抵消關稅的初步措施在一定程度上是有效的，但就涵蓋的產品範圍而言，這些措施還不夠廣泛，也無法抵消關稅之外的普遍通貨膨脹，坦白說，這種通貨膨脹是由關稅引發的。

We continue to pursue a range of actions to mitigate these effects, including a broader price increase that we've already instituted in the third quarter. Broadening our sales streams and realizing the incremental benefits of the pricing we recently introduced should improve our gross margin performance in the second half.

我們將繼續採取一系列措施來減輕這些影響，包括我們已經在第三季實施的更廣泛的漲價措施。擴大銷售管道並實現我們最近推出的定價策略帶來的增量收益，應該能夠提高我們下半年的毛利率表現。

Our operating margin was 20.1% in the second quarter of '19, down 110 basis points year-over-year. We leveraged operating expenses despite the slowdown in sales growth, but not sufficiently to overcome the lower gross margin.

2019 年第二季度，我們的營業利益率為 20.1%，年減 110 個基點。儘管銷售成長放緩，我們仍利用營運費用來彌補，但這不足以彌補毛利率的下降。

Looking at the pieces, we achieved 20 basis points of leverage over employee-related costs, which were up 6.8%. This growth was largely due to a 6.6% increase in absolute and FTE growth in the period. We realized 25 basis points of leverage over occupancy-related costs, which were up 2.5%, comprised of higher vending expenses as we expand the installed base and flattish occupancy expenses. We generated 20 basis points of leverage over other operating and administrative expenses, which were actually down slightly in the period. In light of the slower top line growth, we will seek to reduce our own spending, we'll continue to add resources as necessary to finance our growth drivers and support our ability to take market share but costs and investments that do not support those growth drivers will be more tightly managed.

從各項數據來看，我們在員工相關成本方面實現了 20 個基點的槓桿效應，而員工相關成本卻上漲了 6.8%。這一增長主要歸功於該時期絕對值和全職員工人數增加了 6.6%。我們實現了對佔用相關成本 25 個基點的槓桿作用，這些成本上漲了 2.5%，其中包括隨著安裝基礎擴大而增加的自動販賣機費用和基本持平的佔用成本。我們相對於其他營運和管理費用產生了 20 個基點的槓桿效應，而這些費用實際上在此期間略有下降。鑑於營收成長放緩，我們將努力減少自身支出，我們將繼續根據需要增加資源，為我們的成長動力提供資金，並支持我們獲取市場份額的能力，但對於不支持這些成長動力的成本和投資，我們將進行更嚴格的管理。

Putting it all together, we reported second quarter '19 EPS of $0.36, which was down 3.2% from the $0.37 in the second quarter of '18. Recall, however, that last year's quarter did benefit by $0.02 from a onetime tax gain. If we adjust this out, our EPS were up 1.5% in the second quarter.

綜合來看，我們公佈的 2019 年第二季每股收益為 0.36 美元，比 2018 年第二季的 0.37 美元下降了 3.2%。但需要注意的是，去年同期由於一次性稅收收益而獲得了 0.02 美元。如果剔除此因素，我們第二季的每股盈餘成長了1.5%。

Now turning to Slide 7. Looking at the cash flow statement. We generated $128 million in operating cash in the second quarter, which was 63% of net income. Remember that cash generation in second quarters are typically seasonally lower, the conversion rate in the current quarter is below last year's 72%, though last year, we would have been closer to 66% absent onetime benefits deriving from the tax act. Overall, we view the current quarter's conversion rate to be consistent with the typical 2Q conversion rate.

現在來看第7張投影片，現金流量表。第二季度，我們產生了 1.28 億美元的營運現金流，佔淨利的 63%。請記住，第二季的現金流量通常季節性較低，本季的現金流轉換率低於去年的 72%，儘管去年，如果沒有稅收法案帶來的一次性收益，我們的轉換率會接近 66%。整體而言，我們認為本季的轉換率與典型的第二季轉換率一致。

Net capital spending in the second quarter was $67 million, up from $25 million in the second quarter of 2018, but consistent with our expectations. This reflects investments in hub, property and equipment and vehicles that are necessary to support our high levels of service as well as investments in vending equipment to support growth in our installed base.

第二季淨資本支出為 6,700 萬美元，高於 2018 年第二季的 2,500 萬美元，但與我們的預期一致。這反映了我們在樞紐、房地產、設備和車輛方面的投資，這些投資對於支持我們高水準的服務至關重要；同時也反映了我們在自動販賣設備方面的投資，以支持我們現有客戶群的成長。

Our 2019 range for total net capital spending is unchanged between $195 million and $225 million, with the same factors driving the second quarter increase impacting the full year.

我們 2019 年的總淨資本支出範圍保持不變，介於 1.95 億美元至 2.25 億美元之間，推動第二季成長的因素同樣影響了全年。

We increased funds paid out in dividends by 16% to $123 million. We finished the quarter with debt at 16.6% of total capital, above last year's 16%, but down sequentially and from year-end, and at a level that we believe provides ample liquidity to invest in our business and pay our dividend.

我們將發放的股利增加了 16%，達到 1.23 億美元。本季末，我們的債務佔總資本的 16.6%，高於去年的 16%，但環比下降，也低於年末水平，我們認為目前的水平足以提供充足的流動性，用於投資我們的業務和支付股息。

The working capital picture remains challenging. Inventories were up 15.7% in the second quarter. Almost 40% of this increase relates to inventory added to support Onsites. We believe we can reduce overall inventory even while making these investments, and as a result, began to reduce our overseas purchasing in the fourth quarter of 2018. This can be difficult to discern both because of the lag between such an action and its impacting our balance sheet and because of the slower sales growth this quarter, which lowered our inventory burn rate. However, we would expect these actions to become more visible through the second half of 2019.

營運資金狀況依然嚴峻。第二季庫存成長了15.7%。其中近 40% 的成長與為支援現場服務而增加的庫存有關。我們相信，即使在進行這些投資的同時，我們也能減少整體庫存，因此，我們在 2018 年第四季開始減少海外採購。由於此類行動與對我們的資產負債表產生影響之間存在滯後，以及本季銷售成長放緩導致庫存消耗率下降，因此很難辨別這一點。不過，我們預期這些行動將在 2019 年下半年變得更加明顯。

Our accounts receivable grew 11.7% in the second quarter. Customers continue to aggressively push payments out past quarter end, and as a result, the 2.9 day increase in our receivables days is unsatisfactory. Still, the rate of increase has moderated versus last year, and there are signs that we're reacting more effectively to our customers' actions. As has been the case in recent quarters, we are not seeing any meaningful change in hard-to-collect balances.

第二季度，我們的應收帳款成長了11.7%。客戶繼續積極地將付款日期推遲到季度末之後，因此，我們的應收帳款週轉天數增加了 2.9 天，這是不令人滿意的。不過，與去年相比，成長速度已經放緩，而且有跡象表明，我們對客戶的行為正在做出更有效的反應。與最近幾季的情況一樣，我們沒有看到難以收回的欠款餘額出現任何實質變化。

That is all for our formal presentation. So with that, operator, we'll take questions.

我們的正式報告就到此為止。那麼，操作員，我們開始接受提問。

(Operator Instructions) Our first question comes from the line of Ryan Merkel with William Blair.

（操作說明）我們的第一個問題來自瑞安·默克爾和威廉·布萊爾的對話。

So a couple of questions on gross margins to start here. So first, what exactly is the issue with recapturing product inflation? I recall you thought you'd recapture the 20 basis point price/cost deficit last quarter, this quarter, but it in fact got worse. So what exactly is going on?

那麼，先問幾個關於毛利率的問題。首先，重新捕捉產品通膨究竟有什麼問題？我記得你原本以為上個季度和本季都能彌補 20 個基點的價格/成本差距，但實際上情況更糟了。到底發生了什麼事？

The -- I mean, the goal coming into the year was to eliminate the price/cost deficit that we had. The -- that was the goal the prior year as well, but we still wound up with one. And so it comes down to execution. And the issue was we put in place a plan to address tariffs, in particular. And that resulted in our getting incremental price to offset those tariffs. What I think we underestimated, Ryan, was the degree to which there was general inflation in the marketplace, including general inflation that was being sort of caused and following on the tariffs that were going into place.

我的意思是，年初的目標是消除我們存在的價格/成本差距。——那也是前一年的目標，但我們最終還是只拿到了一個。所以關鍵在於執行力。問題在於，我們制定了一項計劃來應對關稅問題。因此，我們獲得了額外的價格來抵消這些關稅。瑞安，我認為我們低估了市場上的普遍通貨膨脹程度，包括關稅實施而引發的普遍通貨膨脹。

And on top of that, the pricing improvements that we put in affected a significant amount of product within our overall portfolio, but didn't necessarily affect all of it. And we had assumed that we would get enough price to sort of make up for what we didn't address in terms of the product categories, but we didn't quite get there. And again, a lot of the reason for that is simply the incremental inflation above and beyond tariffs that we saw in the marketplace.

此外，我們實施的價格改進措施影響了我們整體產品組合中的大量產品，但並非影響了所有產品。我們原本以為價格會夠高，可以彌補我們在產品類別方面沒有考慮到的不足，但我們並沒有完全達到這個目標。再次強調，造成這種情況的很大一部分原因只是我們在市場上看到的，除了關稅之外，通貨膨脹還在加劇。

So we've looked at the situation, we've sort of evaluated the issues that were in place, and we've taken additional pricing actions at the beginning of Q3, the end of Q2, really to address both the gap that we had for the inflation that we didn't build into the original expectations, so to catch up, if you will, as well as the new tariffs that are beginning to come through the system that we'll experience in our COGS in the latter half of the year.

因此，我們已經審視了形勢，評估了存在的問題，並在第三季初和第二季末採取了額外的定價措施，以彌補我們最初預期中未包含的通膨缺口，從而迎頭趕上，同時也應對了下半年將影響我們銷售成本的新關稅。

And just a follow-up. If I understood what you said correctly, it sounds like your systems aren't capturing inflation appropriately for you to be able to pass it on. Because you're not saying that you've been unable to pass on the price inflation to your customers or that they're pushing back too hard? Am I hearing that right?

還有一個後續問題。如果我理解正確的話，聽起來你們的系統沒有正確地捕捉通貨膨脹，所以你們無法將其傳遞給消費者。因為你沒有說你無法將價格上漲轉嫁給顧客，或是顧客的抵制情緒太強烈？我沒聽錯吧？

No, that's correct. The pricing that we put through, we captured. The -- what we didn't capture is the pricing that we didn't put through that we should have. And so the new pricing is intended to address the gap between what we did capture and the price increases that we've seen and sort of what we didn't wind up putting through the first time around.

沒錯。我們提出的定價方案，我們都採納了。我們沒有記錄的是那些我們應該記錄但最終沒有記錄下來的價格。因此，新的定價旨在解決我們實際獲得的收入與我們看到的價格上漲之間的差距，以及我們第一次未能實現的收入。

Okay. And then presumably, you've improved the system and you have a better handle on what more inflation is coming. So how much price do you estimate you're going to need in the second half of '19 and maybe into 2020 to offset rising product inflation?

好的。然後，想必你已經改進了系統，並且能夠更好地掌握未來通貨膨脹的走向。那麼，您估計在 2019 年下半年甚至 2020 年，需要多少價格來抵銷不斷上漲的產品通膨？

I think we've -- we've looked at it, and we are expecting -- we're putting into place a couple of percentage points of price.

我認為我們已經——我們已經研究過了，我們預計——我們正在實施幾個百分點的價格調整。

Okay. And you're confident that will cover or at least offset most of the price cost deficit?

好的。你確信這能夠彌補或至少抵消大部分價格成本缺口嗎？

Yes, we are.

是的，我們是。

The next question is coming from the line of David Manthey with Robert W. Baird.

下一個問題來自大衛·曼西和羅伯特·W·貝爾德。

First question on the gross margin. Holden, I think you gave some data on this. But could you just disaggregate the gross margin decline of 180 basis points into mix factors versus pricing factors?

第一個問題是關於毛利率的。霍爾頓，我想你在這方面提供了一些數據。但是，您能否將毛利率下降 180 個基點的原因分解為產品組合因素和定價因素？

And then, along with that, Dan, I'm wondering if you can address this -- the 46%. I'm wondering why is 46% a line in the sand when you're at 47-and-change today and your gross margin has been declining, I don't know, 70, 80 basis points annually for the last 5-plus years? Could you talk about that issue as well?

還有，丹，我想請你談談這 46% 的問題。我想知道為什麼 46% 會成為一個難以逾越的界限，而你目前的毛利率已經達到 47% 多一點，而且在過去的 5 年多時間裡，你的毛利率每年都在下降，我不知道，下降幅度是 70 到 80 個基點？您能否也談談這個問題？

Yes. I'll handle the mechanical side of it first, and then will pass it over. But the mix piece was about an 80 to 90 basis point drag, which was probably about 20 basis points more than I would have expected, frankly. The price/cost piece was a 40 to 60 basis point drag, which, again, was a widening versus what we saw in the first quarter. There was about a 20 basis point drag from freight. Then there is a couple other sort of organizational elements that make up the difference.

是的。我會先處理機械方面的問題，然後再交給其他人。但混合股下跌了約 80 至 90 個基點，坦白說，這可能比我預期的要多出約 20 個基點。價格/成本因素造成了 40 至 60 個基點的拖累，而且，與第一季相比，這拖累幅度再次擴大。貨運帶來的拖累約 20 個基點。此外，還有其他一些組織要素也造成了這種差異。

But David, I would think about it this way. Think about it as it's a desired outcome. If we desire over the next $5 billion of growth to expand our operating margin, there is 2 ways to do it. Either you do it by how much you allow your gross margin to move or how much you allow your operating expense to move or force your operating expense to move. Could you make the math work by it going to 44% and operating expenses going to 22%? That's conceivable, but that's really difficult to do. Because you really have to -- you have to understand how much of your business is going to be going through our Onsite model versus our branch model, what our average branch is going to do. The old pathway to profit that we talked about years ago was really about as that branch population matures, it becomes much more profitable because you run away from the lag of fixed costs.

但是大衛，我會這麼想。把它看作是一種期望的結果。如果我們希望在接下來的 50 億美元成長中擴大營業利潤率，有兩種方法可以實現。你可以透過控制毛利率的變動幅度，或是透過控制營運費用的變動幅度，或是透過強制營運費用的變動幅度來實現這一點。如果收益率達到 44%，營運費用達到 22%，你能把這筆帳算清楚嗎？這並非不可能，但做起來卻非常困難。因為你真的需要了解——你需要了解你的業務有多少會透過我們的現場服務模式進行，又有多少會透過我們的分公司模式進行，以及我們平均每個分公司會做什麼。我們幾年前討論的舊盈利途徑實際上是，隨著分支機構數量的成熟，盈利能力會大大提高，因為你擺脫了固定成本的滯後。

And so it's really a case of putting a line in the sand tells your team because this is about a message for internal as much as it's a message for external. It tells your team that if we want to be able to afford these things in the future, we have to claw back on this piece, this piece, this piece and this piece. Sometimes that's clawing back on gross margin and some on price. Sometimes it's about cost, sometimes it's about mix. Sometimes it's about how much freight you put on your own truck versus somebody else's, how much you charge for freight.

因此，這實際上是在劃清界限，告訴你的團隊，因為這既是向內部傳達的訊息，也是向外部傳達的訊息。它告訴你的團隊，如果我們想在未來能夠負擔得起這些東西，我們必須從這部分、這部分、這部分和這部分中節省下來。有時這意味著降低毛利率，有時則意味著降低價格。有時是成本問題，有時是產品組合問題。有時候，關鍵在於你用自己的卡車運送多少貨物，而不是用別人的卡車運送多少貨物，以及你收取多少運費。

It's looking at all those pieces and saying, if we can be a $10 billion company at 46%, we can afford to be at 24% and hit 22%. If we can't, and that goes to 45% or 44%, which is conceivably possible, I mean, in January I talked about that, if -- then we either need to decide is 24% the number, and we're willing to be at 20% or 21%, or do we squeeze that down to 23% and 22%. So the line in the sand is more about the desired outcome and what you're going to challenge your business internally to do to achieve that outcome.

它審視了所有這些因素，然後說，如果我們能以 46% 的收益率成為一家市值 100 億美元的公司，那麼我們就能承受 24% 的收益率，並最終達到 22%。如果做不到，例如降到 45% 或 44%（這也不是不可能，我在一月份就談到過這個問題），那麼我們就需要決定 24% 是否是最終數字，我們是否願意接受 20% 或 21%，或者我們是否要將這個數字壓縮到 23% 或 22%。所以，真正的底線在於你想要的結果，以及你將在企業內部推動哪些變革來實現這個結果。

Okay. That makes sense. Dan, I appreciate it.

好的。這很有道理。丹，謝謝你。

And one thing I would also mention is, recall, when we sort of had that initial conversation about those aspirations, we also noted that the impact of mix and stuff might pull the margin down to 45% and then improvements we make in the business would actually add another 100 basis points or what have you. Now that's from $5 billion to $10 billion. Obviously, we haven't had the time to get that additional 100 basis points of improvement just from the things we do to improve our supply chain, right. So when you think about the baseline, don't forget that always inherent in that guidance was the suggestion that over that period, we would also make process improvements on our own business that would offset some of that mix drag.

還有一點我想提一下，回想一下，當我們最初討論這些目標時，我們也注意到產品組合等因素可能會將利潤率拉低至 45%，而我們在業務方面所做的改進實際上會增加 100 個基點或其他數值。現在金額從50億美元增加到100億美元。顯然，我們沒有足夠的時間僅僅透過改進供應鏈的措施來獲得額外的 100 個基點的改進，對吧。所以，在考慮基準線時，不要忘記，該指導意見中始終隱含著一個建議，即在此期間，我們也應該改進我們自己的業務流程，以抵消一些組合拖累。

Got it. Okay. And then just quickly on the SG&A. I mean, you've only been growing it at a 5% or 6% rate in the first half before you've taken any actions relative to the slowing market, but -- and obviously, if things slow down, you'll get a little natural flex in OpEx lower. Where can you take that set point in the back half of this year? I mean, are you prepping this for sort of mid-single-digit top line and you can set that at 3%? Or can you take it to flat, I don't know? I mean, you have done a good job to this point. I'm just wondering how much further you can work down on that.

知道了。好的。然後簡單說說銷售、管理及行政費用。我的意思是，在上半年你還沒有針對市場放緩採取任何措施之前，你的成長率只有 5% 或 6%，但——顯然，如果市場放緩，你的營運支出自然會降低一些。今年下半年，你能把這個目標設定在什麼位置？我的意思是，你們是否打算把營收目標定在個位數中段，然後設定在 3%？或者你能把它搬到公寓嗎？我不知道。我的意思是，到目前為止你做得很好。我只是想知道你還能把那個地方再往下挪多少。

Yes. I'll answer it, Dave, in this context where my -- where our thinking is right now, based on what our business is doing right now. We are closing some branches every quarter. That frees up some expense every quarter. Based on our run rate, we're going to do about 100 branches that we close. So that gives us some flexibility. There are some branches that we need to expand the existing footprint and expand the cost. But we are able to fund all that through the branches that we are closing, and some of our Onsites, the customer might not have sufficient room and we might have a low-cost storage within a mile or 2 of our customer and while it's a lot cheaper than a branch, it's still an expense. And so that's funding that piece. And so our branch occupancy, Onsite occupancy, net-net is not growing. In fact, that has been contracting slightly. The growth in occupancy is coming from the fact we put more vending machines out there.

是的。戴夫，我會在這個背景下回答這個問題，也就是我們目前的想法，基於我們公司目前的業務狀況。我們每季都會關閉一些分行。這樣每季就能節省一些開支。根據我們的營運速度，我們將關閉約 100 家分行。這樣我們就有了一些彈性。有些分支機構需要擴大現有規模，這也意味著成本會增加。但是，我們可以透過關閉部分分行來籌集資金，而且我們的一些現場服務點可能空間不足，而我們可能在距離客戶一兩英里的範圍內提供低成本的存儲空間，雖然這比開設分行便宜得多，但仍然是一筆開支。這就是該專案的資金來源。因此，我們的分公司入住率、現場辦公入住率，整體而言並沒有成長。事實上，這個數字一直在略微收縮。入住率的成長源自於我們增加了自動販賣機的數量。

If you look at expenses, other nonlabor operating expenses, that, we've done a really nice job of just reining that in. And we have some pieces -- triggers we're pulling right now, for example, the travel component, because we reduced our training in the second half of the year. The real dollars is in labor, if you think about our operating expenses.

如果你看一下各項開支，特別是其他非人工營運開支，你會發現我們在控制這些開支方面做得非常出色。我們現在有一些觸發因素，例如旅行方面，因為我們在下半年減少了訓練。如果把營運成本算在內，真正的高成本在於勞動力。

So there, we have some flex points from the standpoint of how our incentive comp works. I can tell you this, the incentive comp for a number of folks within Fastenal is materially different in July of 2019 than it was in July of 2018. And that -- what that does, and you have described it aptly in the past as the shock absorbers, it gives us the luxury of not having to get crazy with expenses, right today, in the last 90 days, because you're not sure what's happening. And -- but we are pulling back head count growth rapidly and -- because that expense can't be growing at 6% or 7% in an environment where sales are growing 8% and gross profit's growing 4%. So that's really where you're going to see the toggle because the other 2 components which are 30% of SG&A, those are managed really well, and we have been managing the first one, labor, really well, but that was for a different environment, and we need to change our tact.

所以，從激勵薪酬的角度來看，我們有一些彈性調整的空間。我可以告訴你，Fastenal 公司許多員工在 2019 年 7 月的激勵薪酬與 2018 年 7 月相比有了實質的變化。而它的作用——正如你過去恰當地將其描述為減震器——使我們不必在今天，在過去的 90 天裡，因為不確定會發生什麼而瘋狂地增加開支。但是——我們正在迅速減少員工人數的增長——因為在銷售額增長 8% 和毛利潤增長 4% 的環境下，這項支出不能以 6% 或 7% 的速度增長。所以，你真正會看到切換的地方就在這裡，因為另外兩個組成部分（佔銷售、一般及行政費用的 30%）管理得非常好，而且我們一直很好地管理著第一個組成部分——勞動力成本，但那是針對不同的環境，我們需要改變策略。

Yes, if you think, David, our -- if you look at our head count adds, whether it be full-time or FTE, I mean, they were up 6.5%. And just to zip back to May, go back 1 month, and if I look at the absolute head count, it was up 7%. That's actually the highest rate of growth in our head count that we have seen through this cycle, right? And so, obviously, we need to take that rate down. And there is room to do so. Certainly outside of the selling functions, we all need to look at sort of where we have opportunities to be more conservative, but even within the selling organization, we are going to continue to invest in people to support the Onsite growth. We need to do that because it drives our market share gains, but if you look at where head counts are getting added, payroll's getting added there, you're seeing growth outside of the Onsite environment as well, even in an environment where we are closing some branches. And so whether it's in the selling organization outside of the Onsites to support growth or whether it's in the nonselling organization, we are coming off a quarter where we had pretty good growth in heads, that's simply that rate needs to come down given the reality of the growth in the marketplace and should be able to.

是的，大衛，如果你看看我們的人員數量成長情況，無論是全職員工還是全職員工，我的意思是，都增加了 6.5%。讓我們快速回顧一下五月的情況，也就是一個月前，如果我看一下絕對人數，就會發現增加了 7%。實際上，這是我們在本輪週期中員工人數成長率最高的一次，對吧？所以，很顯然，我們需要降低這個比率。而且還有這方面的空間。當然，在銷售職能之外，我們都需要思考在哪些方面可以採取更保守的做法，但即使在銷售組織內部，我們也將繼續投資於人才，以支持現場業務的成長。我們需要這樣做，因為這能推動我們市場份額的成長，但如果你看看員工人數的增加情況，以及工資支出的增加情況，你會發現即使在我們關閉一些分支機構的情況下，現場環境之外也存在增長。因此，無論是在現場以外的銷售組織中支持成長，還是在非銷售組織中，我們剛剛經歷了一個季度的人員成長相當不錯，但鑑於市場成長的現實，這個速度需要下降，而且應該能夠下降。

Yes. A good example over the last few years as we ramped up our Onsites, our implementation team that we have in the field, I believe, we took the number over the last 2 years from about a 140-ish, 130-ish to about 230 to handle all these implementing of National Accounts and Onsites, so it's not just Onsites, but National Accounts in general. That team, we're not having to grow as rapidly now, in fact, it's relatively stable because we're not going from signing 80 Onsites to 280 to 3-something to 400. We're kind of in that zone of around 400. We think that's a good cadence for our customers and for our business. So it doesn't require us to expand that group. So that group has been -- I think we're up 5 in the last 12 months. So it's things like that that we can do in the short term.

是的。過去幾年，隨著我們在現場實施團隊的壯大，我們在現場實施團隊的人數就是一個很好的例子。我相信，在過去的兩年裡，我們的現場實施團隊人數從大約 140 人、130 人左右增加到大約 230 人，以處理所有這些全國性客戶和現場實施工作。所以，這不僅僅是現場實施，而是整個全國性客戶。事實上，我們現在不需要像以前那樣快速發展團隊了，它相對穩定，因為我們不需要像以前那樣從簽約 80 名現場工作人員發展到 280 名，再到 300 多名，最後到 400 名。我們現在大概在 400 左右。我們認為這對我們的客戶和我們的業務來說都是一個好的節奏。所以我們不需要擴大這個群體。所以，我認為在過去的 12 個月裡，我們這個團隊取得了 5 場勝利。所以，我們可以在短期內做類似的事情。

Our next question is from the line of Nigel Coe with Wolfe Research.

我們的下一個問題來自沃爾夫研究公司的奈傑爾·科伊。

Just going back to the price increases. And I think, Holden, you mentioned 2%. Is that across the whole board? Or would that be the non-National Accounts? And certainly, the spirit of the question is, are you able to get price for National Accounts? Or is that still contractually locked in at this point?

再說回物價上漲的問題。霍爾頓，我想你提到了2%。這種情況普遍存在嗎？或者，那是指非國民帳戶嗎？當然，問題的本質是，你能否獲得國民帳戶的價格？或者說，目前這仍然受到合約的約束？

Well we are not looking at our business differently in that sense as it relates to the impact of cost increases and the price we're putting in place, right? We can't go after the 50% of our business that is non-National Account and not address the 50% of the business that is National Account. Now National Account has certain mechanisms that are built into the contracts that make that process perhaps a little bit more mechanical. But the intention is to work through that process and get price increases there where necessary as well because we're selling the same products into National Accounts as we are non-National Accounts and the costs are behaving the same. So no, we're not taking half of our business and setting it aside and saying, we're not going to touch this. We can't do that and be successful in what we're trying to achieve.

從成本上漲的影響以及我們制定的價格策略來看，我們並沒有以不同的視角看待我們的業務，對吧？我們不能只專注於占我們業務50%的非全國性客戶，而不關注占我們業務50%的全國性客戶。現在，國民帳戶體系的合約中內建了一些機制，使得這個過程可能更加機械化一些。但我們的目標是逐步推動這個過程，並在必要時提高價格，因為我們向全國性客戶和非全國性客戶銷售的產品相同，成本也相同。所以，不，我們不會把一半的業務擱置一邊，然後說，我們不會碰它。我們不能這樣做，否則我們就無法實現我們的目標。

One thing I'll just add, for a little color is, Holden cited an average. Average sometimes can be dangerous. We have -- if you think about China as an industrial producer, I believe 52% of the steel that's produced on the planet Earth is produced inside of China. I might be off a point or 2, but I'm in the ballpark. Our fastener product, which is roughly 1/3 of our business, is made out of steel. And a high percentage -- most of the -- there are the Holo-Kromes of the world, that's the company I cited earlier, but they represent a minority of the fasteners that are consumed in North America.

我還要補充一點，霍爾頓引用的是一個平均值。平庸有時也可能很危險。如果把中國看成一個工業生產國，我認為地球上生產的鋼鐵有 52% 是在中國生產的。我可能差一兩分，但大致沒錯。我們的緊固件產品約占我們業務的 1/3，由鋼材製成。而且，很大一部分——大部分——都是像 Holo-Kromes 這樣的公司，也就是我之前提到的公司，但它們只佔北美消費緊固件的一小部分。

So most of the fasteners, regardless of where you're getting them, I mean who is the distributor, who is the importer, most of the fasteners on this planet are made in China. And we've moved some production out. Actually, we've moved -- if you look at the amount we've moved in the last 9 months out of China and compare it to what the U.S. economy is moving, we've actually moved more than the U.S. economy has, if you look at the statistics. And -- but the reality is even in a 10% or a 25% tariff environment, they oftentimes are still the lowest-cost producer of an item.

所以，無論你從哪裡獲得緊固件，我的意思是，無論分銷商是誰，進口商是誰，地球上大多數緊固件都是中國製造的。我們已經將部分生產轉移到其他地方。事實上，我們已經轉移了——如果你看看過去 9 個月我們從中國轉移的金額，並將其與美國經濟的轉移金額進行比較，如果你查看統計數據，就會發現我們轉移的金額實際上比美國經濟轉移的金額還要多。但現實情況是，即使在 10% 或 25% 的關稅環境下，他們往往仍然是某種商品的成本最低的生產商。

And so there is -- while Holden might cite an average across a whole bunch of products, there is a lot of different parts in there. There is 4 lists of items that have been identified by the U.S. government. List 1 and List 2 didn't really impact us that much. We don't import raw steel. List 3 hit last September, hit us quite hard, and that list went from 10% to 25% here in the second quarter. That hits squarely into our fastener product. List 4, nothing has happened yet, it's on hold. I don't know what's going to happen there. We do have products on List 4, and most of those will be in the non-fastener area. And so there are parts where we are raising materially higher than 2% and there are parts we're not touching. And -- but be mindful of that.

因此，雖然霍頓可能會引用一大堆產品的平均值，但其中有許多不同的零件。美國政府已確定了 4 份物品清單。列表 1 和列表 2 對我們並沒有造成太大影響。我們不進口原鋼。去年九月，第三類不良事件頻傳，對我們造成了相當大的衝擊，該類不良事件在第二季從 10% 上升到 25%。這正好打擊了我們的緊固件產品。清單 4，目前還沒有任何進展，處於擱置狀態。我不知道那裡會發生什麼事。我們確實有產品列入了清單 4，其中大部分屬於非緊固件領域。因此，有些領域的稅率我們大幅提高了 2%，而有些領域我們則沒有動搖。但是——請注意這一點。

And as it relates to National Accounts versus non-National Accounts specifically, so yes, 2% is an average. Difficult to say whether National Accounts will be more or less given -- in any given quarter or what have you, but again, the intention, we are not setting aside 50% of our business and saying this is not something we think that we can impact. We think we can.

至於國民帳戶與非國民帳戶的具體區別，是的，2% 是一個平均值。很難說國民帳戶在任何特定季度或其他情況下會增加還是減少，但再次強調，我們的意圖是，我們不會把 50% 的業務排除在外，然後說我們認為我們無法對此產生影響。我們認為我們可以做到。

Understood, understood. And then Holden, very quickly, I mean, can you maybe just address the gross margin cadence over the balance of the year because we tend to have a seasonally lower gross margin second half versus first half and 2Q? How does the price increase that you're implementing, how does that impact that normal seasonal pattern?

明白了。然後，霍爾頓，我只想快速地問一下，您能否談談今年剩餘時間的毛利率走勢，因為我們下半年的毛利率通常會比上半年和第二季度低一些？你們實施的價格上漲會對正常的季節性模式產生什麼影響？

Yes. So the price increases are already -- have already been installed. So I would expect that we'd begin to see some benefit in July, and that we'd see a greater benefit in August or September and then heading into the fourth quarter, right? So that will ramp up.

是的。所以價格上漲已經——已經生效了。所以我預計7月會開始看到一些成效，8月或9月會取得更大的成效，然後進入第四季度，對吧？所以這種情況會加劇。

The costs from the new tariffs -- now, of course, we're already behind on costs from generalized inflation, but costs from new tariffs would begin to impact us probably in the middle part of Q4, so think about that cadence on cost.

新關稅帶來的成本——當然，現在我們已經落後於普遍通貨膨脹帶來的成本，但新關稅帶來的成本可能會在第四季中期開始對我們產生影響，所以要考慮成本的這種變化節奏。

If I think about the pieces that affected our gross margin this quarter and how that plays out, I -- seasonally, I think Q2 would typically be down 10 to 20 basis points, maybe flat to down 20 basis points from Q2. So I think that's probably the typical seasonal pattern, but I think there's some of the drag from freight. I think we might be able to get 10 basis points back from freight that we saw this quarter. I think that there may be a path to 40 basis points give or take on price/cost into the third quarter. And when you lay that all out, I think that there's a path in the third quarter to have a gross margin that's a little bit north of 47%, which would cut the 180 basis point drag we had this quarter in half. And I think that we can expect something like that, maybe a little bit less of a decline in the fourth quarter as well, given the things that we're seeing. So that's kind of the cadence that we see.

如果我考慮一下影響本季毛利率的因素以及這些因素是如何產生的，我認為——從季節性角度來看，第二季度通常會下降 10 到 20 個基點，或者與上一季持平或下降 20 個基點。所以我認為這可能是典型的季節性模式，但我認為貨運也造成了一定的拖累。我認為我們或許能從本季的貨運收入中挽回 10 個基點的損失。我認為第三季價格/成本可能會有 40 個基點的波動。綜合所有因素來看，我認為第三季毛利率預計略高於 47%，這將使本季 180 個基點的下滑幅度減半。我認為我們可以預期類似的情況，鑑於我們目前看到的情況，第四季的下滑幅度可能會略小。這就是我們看到的節奏。

Obviously, it relies on our executing effectively, which we expect, but should we do so, I think that there's the seasonality. Then I think you can add a little bit from price/cost gain and you can add a little bit from freight gain.

顯然，這取決於我們能否有效執行，我們也期望能夠做到，但即便我們做到了，我認為也會受到季節性因素的影響。那麼我認為你可以從價格/成本收益中增加一點，也可以從運費收益中增加一點。

The next question is from the line of Robert Barry with Buckingham Research.

下一個問題來自白金漢研究公司的羅伯特·巴里。

Maybe actually just to pick up where you left off there, Holden. So it sounds like you think you can kind of claw back into the, call it, low to mid-47s on the gross margin, but then I think you also said that the impact of the new tariffs are going to start to hit you in the fourth quarter. So does that mean you need to go back then again and get more price? Or would we then kind of start moving back down in the other direction there?

或許，霍爾頓，你只是想接著上次中斷的地方繼續做下去。聽起來你認為毛利率可以勉強恢復到 47% 左右，但你也說過，新關稅的影響將在第四季開始顯現。所以這是否意味著你需要再去一次，重新詢價？或者我們會不會開始朝另一個方向走下去？

Well, first, I think what I said was a little over 47%. I don't think I ever said mid-40s, first off.

首先，我認為我剛才說的應該是略高於 47%。首先，我好像從來沒說過四十多歲。

I'm sorry, mid-47%, like 47.5%.

抱歉，大概是 47% 左右，例如 47.5%。

Yes. I will just throw something in. The latest round of tariffs came into play in the Q2. So there's products that were -- but -- and the stuff that was on the water was not impacted, but if it hadn't shipped, it is impacted. So we have costs that are coming in right now that are from that latest wave. Some of those costs will turn in July and then a bigger piece will turn in August and a bigger piece will turn in September and it's based on our fastener inventory does turn at a certain cadence, but there is customer-specific product that we might bring in that turns in 60 days. So the price moves we're doing and the costs, while that comes in in waves, we're putting in place right now.

是的。我隨便加點東西進去。最新一輪關稅在第二季生效。所以有些產品——但是——在水上的產品沒有受到影響，但如果產品還沒有發貨，就會受到影響。所以，我們現在要承擔一些來自最新這波疫情的成本。其中一些成本將在 7 月發生，然後更大的一部分將在 8 月發生，更大的一部分將在 9 月發生，這是基於我們的緊固件庫存的周轉節奏，但我們可能會引進一些客戶特定的產品，這些產品可以在 60 天內完成周轉。所以，我們正在進行的價格調整和成本調整，雖然會分階段進行，但我們現在正在落實到位。

And some will go in place in August, and some will go in place in September, but they're both moving now. It isn't a case of there's multiple waves. There's -- what the message I've given to our team is we're not doing 1 price increase on every part, we're -- you're doing some stuff every month based on what's happening in that month, working with your customer and their individual supply chain because, keep in mind, a big piece of what we sell is stuff that's unique to a customer. That's what makes it more difficult to manage systematically and -- but our team can be responsive locally.

有些項目將於 8 月實施，有些項目將於 9 月實施，但它們現在都在推進中。這不是多波現象。我傳達給團隊的訊息是，我們不會對所有產品都進行一次提價，而是每個月根據當月的情況，與客戶及其各自的供應鏈合作，進行一些調整。因為請記住，我們銷售的產品中很大一部分是客戶獨有的。正因如此，系統性管理變得更加困難——但我們的團隊可以對當地情況做出快速反應。

And when I talked about 40 or 50 basis points of clawback in the back half of the year, I am assuming that you get both a little bit more price and a little bit more cost in Q4 versus where you are in Q3. So that's how we see that playing out. I do think costs will be higher in Q3. They'll be a little bit higher than that in Q4, but I think the price side of it will also escalate a little bit as that flows through.

當我談到下半年 40 或 50 個基點的回撥時，我假設第四季的價格和成本都會比第三季略高一些。所以我們看到事情就是這樣發展的。我認為第三季的成本會更高。第四季它們會比這略高一些，但我認為隨著這股潮流的到來，價格方面也會略有上漲。

Right. So given the mention of the waves, I mean, when is the full impact of the List 3 at 25% kind of fully into the P&L?

正確的。既然提到了波浪效應，我的意思是，第三批措施（25%）的全部影響何時才能完全體現在損益表中？

You start seeing the fuller impact of it by the time you get into the middle part of Q4, past that.

到了第四季中期及之後，你會開始看到它更全面的影響。

Got it. And I guess just to circle back to an earlier question about achievability, I mean, given the slowing demand environment and the fact that these are now much bigger numbers than 10%, I mean, what's the confidence on getting to price/cost neutral? Or is that even the goal? Because I think you mentioned earlier planning to share some of the burden with the customers.

知道了。我想回到之前關於可實現性的問題，我的意思是，考慮到需求環境放緩，而且這些數字現在比 10% 大得多，那麼，對實現價格/成本中性有多大信心呢？或者，這真的是他們的目標嗎？因為我記得你之前提到過計劃與客戶分擔一些負擔。

I don't believe getting cost/price to be neutral is realistic. With that said, we have to work to get -- you have to work to get close to it. And some of it -- as I've said on prior calls, some of it involves having a challenging conversation with your customer, sometimes it's price substitution, sometimes it's looking and saying the cost of this is up, here's a different alternative that's a cheaper price to start with, for whatever reason, maybe it's a more standard product, maybe what the customer is using is actually a nonstandard item and there is a more standard substitute. And it requires, in some cases, some engineering support to get it approved for use in that process. Those are the challenging aspects, but that's -- in times like this, you create more friction to creates those challenges because then it allows both Fastenal and our customer to win. Neither one of us takes the full brunt because you changed the math. But it takes a lot of work.

我認為要達到成本/價格中性是不切實際的。也就是說，我們必須努力才能得到──你必須努力才能接近它。而其中一些——正如我在之前的電話會議中所說——涉及與客戶進行具有挑戰性的對話，有時是價格替代，有時是查看並說明這個產品的成本上漲了，這裡有一個不同的替代方案，這個替代方案的初始價格更低，無論出於什麼原因，也許是更標準的商品，也許客戶正在使用的實際上是非標準商品，而有一個更標準的替代品。在某些情況下，還需要一些工程支援才能獲得批准用於該流程。這些都是具有挑戰性的方面，但是——在這樣的時期，製造更多摩擦來創造這些挑戰，因為這可以讓 Fastenal 和我們的客戶都成功。因為你改變了計算方法，我們兩個都不會承擔全部責任。但這需要付出很多努力。

And then bear in mind as well that while I think the environment today might be a little bit more challenging than it would have been 6 months ago, we also are better at executing this than we were the first time we did it. We've learned more about the systems that we have, we've made tweaks to the systems that we have so that fewer things won't be covered and that sort of thing. So I think -- while I think you're right that the environment perhaps is a little bit more difficult than was true 6 months ago, I think that our knowledge of how to manage the process is also better. And so now we just need to go and execute it.

此外，還要記住，雖然我認為今天的環境可能比 6 個月前更具挑戰性，但我們在執行這項任務方面也比第一次執行時做得更好。我們對現有系統有了更深入的了解，並對現有系統進行了調整，以便減少遺漏事項等等。所以我覺得——雖然我認為你說得對，現在的環境可能比 6 個月前更艱難一些，但我認為我們對如何管理這個過程的了解也更好了。所以現在我們只需要去執行它。

The next question is from the line of Josh Pokrzywinski with Morgan Stanley.

下一個問題來自摩根士丹利的 Josh Pokrzywinski。

Just want to follow up on the deceleration you guys saw in non-resi in June. Holden, any color -- Holden or Dan, any color on maybe some specific pockets or verticals there? Anything you've heard from the regions that may give a little bit more of an indication how persistent that is versus maybe one bad month?

我想就你們在6月觀察到的非住宅市場成長放緩的情況做個後續說明。霍爾頓，任何顏色——霍爾頓或丹，任何顏色，也許可以印在某些特定的口袋或垂直面上？你從其他地區聽到什麼消息，可以更清楚地表明這種情況是持續性的，還是只是某個月份的糟糕情況？

Not as much color as I wish I could give you. Our larger customers did pretty well. The customers that we have a lot of volume with, they tend to be National Accounts, grew fairly well within the construction side. What did not grow as well was the smaller customer base. Now some of the RVPs commented about wet weather and things like that, but that was scattered, it wasn't a consensus by any means. And so I'm not sure exactly why that piece of the market was slower for us than was true of the larger customers. I wish I had more color for you, but I don't think I have a lot.

我無法呈現給你足夠豐富的色彩。我們的大客戶表現相當不錯。我們業務量大的客戶，他們往往是全國性客戶，在建築領域發展得相當好。成長不如預期的是較小的客戶群。現在，一些區域副總裁提到了潮濕天氣之類的事情，但這些說法比較零散，遠遠沒有共識。因此，我不太確定為什麼我們開拓這部分市場的步伐比開拓大客戶市場的速度慢。我希望我能給你更多色彩，但我認為我沒有太多。

Got it. And then just on the kind of, directionally some more National Account deceleration. I couldn't help but notice in the press release as well some comments around monitoring investment. How much of that is directed to National Accounts or Onsite programs versus kind of the general concept of investment or cost containment. Just trying to think about, if there's a trend to be had here on National Accounts as some of those dollars get cut.

知道了。然後，國民經濟成長速度在方向上略有放緩。我在新聞稿中也注意到了一些關於投資監控的評論。其中有多少用於國家帳戶或現場項目，又有多少用於一般的投資或成本控制概念。我只是想思考一下，隨著部分資金被削減，國家帳戶方面是否存在某種趨勢。

Well, our intention is to continue to invest in those things that allow us to gain market share. We believe that we continue to gain market share in the marketplace at a pretty good clip. And that's ultimately the goal, right? Whatever happens in the market happens in the market. But what we can control is how we -- how much we gain market share. And so our intention is with Onsites, we have to be able to staff Onsites, and we're -- so we're going to continue to add personnel to be able to deliver that model to the customers that are entrusting more of their supply chain with us. With vending, we're going to continue to invest in what we need to pursue that 23,000 to 25,000 unit goal this year. So there's nothing in there that was intended to convey that we're going to be tighter on growth drivers because we're not. We need to invest in those to continue to gain market share.

我們的目標是繼續投資那些能夠幫助我們獲得市場份額的項目。我們相信，我們在市場上的市場份額將繼續以相當快的速度成長。這才是最終目標，對吧？市場自有其規律。但我們可以控制的是如何獲得市場份額——我們能獲得多少市場份額。因此，對於現場服務，我們必須能夠配備現場人員，所以我們將繼續增加人員，以便能夠為那些將更多供應鏈委託給我們的客戶提供這種模式。在自動販賣機方面，我們將繼續投資於所需的資源，以實現今年 23,000 至 25,000 台的目標。所以，其中沒有任何內容意在表明我們將收緊成長驅動因素，因為我們並沒有這樣做。我們需要投資這些領域，才能繼續擴大市場佔有率。

It's really resources outside of the growth drivers where we have to look at it, and we have to say where can we save ourselves some expense? And the head count was one thing that we talked about that. And again, I think I emphasized there that we're going to continue to staff the Onsite. That's not where we're going to be going after the head count, but there's other areas where whether it be the hubs, whether it be the branches, whether it be the Winona headquarters, et cetera, there's -- when growth slows, there's an opportunity to slow the rate of head count in areas like that. And those are the types of things we need to look at.

我們必須關注的是成長驅動因素之外的資源，我們必須思考在哪裡可以節省開支？人員數量是我們當時討論的問題。我再次強調，我們將繼續配備現場工作人員。這不是我們削減員工人數的目標，而是在其他一些領域，無論是樞紐、分公司還是威諾納總部等等，當成長放緩時，就有機會放慢這些領域的員工人數成長速度。而這些正是我們需要關注的問題。

But no, when we talk about monitoring investment, monitoring spending, that really is more of a message outside of the growth drivers, provided we're doing the right things on the growth drivers, by the way. If we find that we're doing something we don't need to in a growth driver, we'll address that as well. We're not looking to spend where we don't have to anywhere. But the real scrutiny has to occur outside of the growth drivers because we're not -- our goal is to gain market share, and the growth drivers are key to that.

但是，不，當我們談到監測投資、監測支出時，這實際上更多的是在成長驅動因素之外傳遞訊息，前提是我們在成長驅動因素方面做得正確。如果我們發現我們在成長驅動因素方面做了一些不必要的事情，我們也會解決這個問題。我們不想在不必要的地方花錢。但真正的審視必須在成長驅動因素之外進行，因為我們不是——我們的目標是獲得市場份額，而成長驅動因素是實現這一目標的關鍵。

Got it. And I guess just a corollary to that. There was a more direct reference to inventory in that comment in the release. I would imagine that given some of the advance purchases last year, they weren't much, but there were some, and the cutting of purchases this year, should we expect something to show up in terms of the rebate structure looking like a little bit more of a headwind than you would have contemplated before?

知道了。我想這只是由此而來的推論。新聞稿中的那條評論更直接地提到了庫存問題。我想，考慮到去年的一些預購，雖然數量不多，但還是有一些的，而今年的採購量有所減少，我們是否應該預料到，退款結構可能會比你之前預想的更具阻力？

Well, the -- with regards to the inventory, I think we're sort of past that sort of accelerated purchase that we made in Q4. I think between Q4 and Q1 that kind of adjusted itself out. I think more meaningful for the inventory as you go into the second half of this year is, our purchasing teams, our supply chain teams, they've really reduced their spend starting in Q3, Q4 last year through Q2 of this year and fairly meaningfully so because we have enough products in the hub today for the level of demand that we're currently seeing. And that allows us to be a little bit more cautious with that spend. And so we have seen a reduction in spend, particularly of imported product currently versus where we were 3 quarters ago, 2 quarters ago. And I think that will begin to flow through in lower inventory as we go through the third quarter and fourth quarter.

至於庫存方面，我認為我們已經度過了第四季那種加速採購的時期。我認為從第四季度到第一季度，這種情況已經逐漸得到了調整。我認為，進入今年下半年，對庫存而言更有意義的是，我們的採購團隊和供應鏈團隊從去年第三季度、第四季度到今年第二季度，確實大幅減少了支出，而且減少幅度相當大，因為我們目前在中心擁有足夠的庫存產品，可以滿足我們目前所看到的需求水平。這樣一來，我們在支出方面就可以更加謹慎。因此，我們看到支出有所減少，特別是進口產品的支出，與 3 個季度前、2 個季度前相比有所減少。我認為隨著第三季和第四季的到來，庫存下降的情況將會開始顯現。

Now interestingly, rebates are actually a heavier component on domestic spend than they are in the imported spend. And so I wouldn't necessarily assume that a reduction in import is going to have a terribly dire impact on the rebate piece. The rebates tend to be more affected by the domestic spend, and right now, we've really gone after that imported spend as much as anything else. Make sense?

有趣的是，退稅在國內消費中所佔的比重實際上比在進口消費中所佔的比重更大。因此，我並不認為進口減少會對退稅產生非常嚴重的負面影響。退稅往往更受到國內消費的影響，而目前，我們確實把重點放在了進口消費上。明白了嗎？

Okay. Got it. Yes. Appreciate the color.

好的。知道了。是的。欣賞這種顏色。

The next question is coming from the line of Adam Uhlman with Cleveland Research.

下一個問題來自克里夫蘭研究公司的亞當·烏爾曼。

Dan, you made an interesting comment a little bit ago that the company has moved more suppliers out of China than the broader economy. I kind of missed what exactly you were getting at there. Could you just share with us in more detail kind of the actions that the company has taken on moving activity out of China? And then maybe just share with us today where do we stand in terms of your total purchases that are coming out of that country?

丹，你剛剛發表了一個很有趣的評論，說該公司將更多供應商遷出中國，而整體經濟卻沒有這樣做。我有點沒懂你的意思。能否更詳細地介紹一下公司為將業務活動遷出中國所採取的措施？那麼，您今天能否和我們分享一下，就您從該國的總採購額而言，我們目前處於什麼位置？

Yes. I'd prefer not to get into specifics from a standpoint of percentages, just from the standpoint I don't necessarily want to share that information publicly. And that's for competitive reasons, quite frankly. But we always have multiple sources of supply for product. In the case of fasteners and non-fasteners, they include a variety of suppliers and sometimes that can include a variety of countries. But the universe of countries is not that large, but the universe of suppliers is quite large. And you do that because our covenant with our customers, we will have product available for them when they need it.

是的。我不想從百分比的角度談論具體細節，因為我並不想公開分享這些資訊。坦白說，這是出於競爭原因。但我們始終有多種產品供應來源。就緊固件和非緊固件而言，它們包括各種供應商，有時甚至包括多個國家。但是國家數量雖然不多，但供應商數量卻相當多。之所以這樣做，是因為我們與客戶有約定，我們會在他們需要的時候為他們提供產品。

And the other reason to have it is you -- the one challenging thing from the standpoint of how many you have and how fast you can move it is not only do you have to have confidence in your supply, you need to have confidence in your quality of supply because we're -- at the end of the day, we're selling a product that holds stuff together or is used by people. Half our revenue is either a fastener or a safety item. And so you have important quality consideration in all the products, but especially in those.

擁有它的另一個原因是——從你擁有的數量和周轉速度來看，最具挑戰性的事情不僅在於你對你的供應有信心，還在於你對供應的質量有信心，因為歸根結底，我們銷售的是一種將東西固定在一起或供人們使用的產品。我們一半的收入都來自緊固件或安全用品。因此，所有產品，尤其是這些產品，都必須重視品質。

And -- but if you look at the statistics, and the statistics are out there for me to look at, the amount of product that has been resourced as far as what's coming through and as measured by U.S. Customs, the percentage that's been resourced is actually fairly small. And a lot of it is there's sophisticated supply chains out there that are difficult to change that have been set up not in the last 5 years, but in the last 25 years.

但是——如果你看看統計數據，而統計數據就擺在那裡供我查看，根據美國海關的統計，已經獲得資源的產品數量，其百分比實際上相當小。很多時候，市場上存在著複雜的供應鏈，這些供應鏈很難改變，它們不是在過去 5 年建立起來的，而是在過去 25 年建立的。

In the case of us, where we had a cost stability early on, because the other challenging thing is we might have other sources of supply, but they might be 5% more expensive, they might be 12% more expensive, they might be 20% more expensive in different places. You don't move the 5% -- the 5% stuff you move, if you can, and you try to get ahead of everybody else who wants to do the same thing, when there's tariffs at 10%. But the 12%, you might not or you might, depending on what you think is going to happen next. And so we moved on some of that fairly aggressively last -- late last fall, and so we moved a chunk of our product out of China. Most of that, that we moved, went to other Asian countries, Taiwan, primarily. And so there's inflation introduced because of that because you're probably buying it for more, but you're paying less or equal to the tariff. And it's really because of the supply chain relationship we have with our customer. But percentage-wise, we've moved more than what the U.S. economy has, looking at import data.

就我們而言，我們早期就實現了成本穩定，因為另一個挑戰是，我們可能還有其他供應來源，但不同地方的價格可能會高出 5%，12%，甚至 20%。你不會挪動那 5% 的東西——如果可以的話，你會挪動那 5% 的東西，並且你會努力搶在其他想做同樣事情的人前面，因為關稅是 10%。但那12%的機率，你可能不會得到，也可能得到，這取決於你認為接下來會發生什麼。因此，我們在去年秋末採取了相當積極的行動，將一部分產品從中國轉移出去。我們搬遷的大部分物品都運往了其他亞洲國家，主要是台灣。因此，由於你可能要花更多的錢購買商品，但你支付的稅款卻少於或等於關稅，所以就會出現通貨膨脹。這其實是因為我們與客戶之間良好的供應鏈關係。但從進口數據來看，從百分比來看，我們的成長幅度超過了美國經濟的整體成長幅度。

Okay. Got you. And then a clarification. You had mentioned that the incentive comp was reduced a lot, and I'm just wondering if that came through the P&L in the second quarter. Or if that's a third quarter event, and if it was material for the quarter.

好的。抓到你了。然後是一份澄清說明。您曾提到激勵性薪酬大幅減少，我想知道這是否反映在第二季的損益表中。或者如果這是第三季發生的事件，並且是該季度的重要事件。

It would have come through on the second quarter. It's a piece of the equation because if you think about what's going on with labor expense, there's 2 dynamics there. I mean, one is the sheer head count -- well, 3 dynamics. One is the sheer head count growth. The other is, there is inflation, particularly in the part-time areas, but there is inflation, in general, in payrolls across the U.S. economy because we have very low unemployment. And so those 2 dynamics are adding -- are pushing it up. This actually pulled it down a little bit.

本來第二節就能實現的。這是等式的一部分，因為如果你考慮勞動成本的現狀，你會發現其中有兩種動態因素。我的意思是，一是人數眾多——嗯，有 3 個因素。一是員工人數的急劇增長。另一方面，雖然存在通貨膨脹，尤其是在兼職領域，但總體而言，由於失業率非常低，美國經濟各領域的工資都出現了通貨膨脹。因此，這兩種因素疊加起來，推高了價格。這實際上讓它稍微下降了一些。

At this time, there are no additional questions. Would you like to make some closing comments, Mr. Florness?

目前沒有其他問題。弗洛內斯先生，您還有什麼要補充說明嗎？

Just want to thank everybody for their time this morning. And I hope you found this call and our disclosures useful in understanding what's happening in our business selling into industrial in North America and the rest of the planet. Thank you.

非常感謝大家今天早上抽出時間。我希望您覺得這次通話和我們的揭露資訊有助於您了解我們在北美和全球其他地區向工業領域銷售產品的業務現狀。謝謝。

Thank you. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.

謝謝。今天的會議到此結束。您可以在此時斷開線路。感謝您的參與。