GWWW.W. Grainger, Inc.

W.W. Grainger supplies businesses with consumables and spare parts — it sells not the goods but the speed of getting them.

The catalogue holds millions of items: tools, fasteners, safety equipment, electrical and plumbing supplies. The buyer is a plant or hospital with something broken now, where downtime costs many times the price of the part. That is why the customer pays a premium for availability and same-day delivery.

The competitive advantage is the warehouse network and inventory accuracy: knowing what to stock and in what quantity is data accumulated over decades. A second, cheaper channel without salespeople works as an online shop for small orders.

Risks: competition with Amazon in business procurement, where price is visible immediately and urgency is not; the industrial cycle; and logistics costs, which cannot be trimmed while promising same-day delivery. Grainger is a dividend aristocrat with a very long record of increases.