By Mike McGuire
During the recent FASTENER TECH 19 Expo a few of us were sitting around enjoying an adult beverage, relaxing a little bit from a good day in the show and settling all the problems of the fastener industry. One topic we discussed in detail was surplus fasteners and how this segment of the industry could change quickly with all the uncertain tariff rules and regulations, longer than normal lead times and some people fearing a downward trend in business. It was felt some distributors would be offering more surplus fasteners then normal to replace lost sales and to generate some additional cash-flow.
I guess, I lead a good part of this discussion because I have seen surplus fastener trends for over 50 years now. It was suggested, that since I was introducing a NEW feature for “REAL” Live Surplus Fastener Listings on my website www.usfastenersources.com that I should write a history of Surplus Fasteners as I had experienced them to better inform others in the industry.
My first introduction to supply fasteners was by my father and “The Book” in tabloid format from Industrial Supply in Chicago, headed up by Ly Nathan. As I understood, Ly had purchased an extremely large amount of World War II surplus fasteners from the defense department. At the time, fasteners were generally sold by a List & Discount Price Schedule. If memory serves me right, the following discounts applied: Small Screws, the discount was 7/10s or a multiplier of .478296, Structural Bolts less 32% from domestic manufacturers, Hex Head Cap Screws approximately 52% off list, Domestic manufactured Socket Screws, 40% off. At the time there were “Jobber” Discounts, “Distributor” Discounts and Suggested Selling Prices. Price sheets at the time were either green, blue or yellow determining the different type of price schedules.
Ly had his own set of discounts, but they pretty much followed industry discounts off List Prices, so it was easy to determine ones cost and then they just needed to check with Ly that the fastener shown in his book were still available. As I recall, his book was published about twice a year. At our family distributorship, we were purchasing some sort of surplus fasteners about every week from Industrial Supply…a very good supplier at the time.
In the early 1960’s, Sid Goodwin from Ace Industrial Hardware in Camden, New Jersey bought out a very large assortment of socket screws from SPS. Sid was very competitive, had a hell of a lot of socket products and quickly became another great supplier of surplus socket screws. This lead Sid to join the NFDA and later to become its’ President in 1972.
I am not exactly sure when, late 1950s or 60s, but Dick Kerr from Kerr-Lakeside did a brilliant move by manufacturing and offering what he called Semi-Standard Socket Screws. Dick took what would have been called a “special length” socket cap screw or surplus sockets and made them a regular standard item. Depending of the diameter and length, now you could buy that non-standard socket cap screw be it a 1/8”, 1/4″ or 1/2” longer or shorter. KLI did an excellent job because they carried the inventory and they were not selling from an empty cart.
This idea was also tried by a guy in Chicago with USS Grade 5 Hex Head Cap Screws, but shortly went out of business because he carried very limited inventory or none at all.
In the 1960s, a small firm from Cincinnati, Ohio started “SOS” Southern Ohio Surplus for taking the over-runs from Midwest fastener manufacturers and trying to sell them. Not sure you would call these parts surplus, but it was tried.
1972, as a young pup in the NFDA, I was selected to compile the 1st NFDA Surplus Directory. Each member would submit their surplus inventory on 3 x 5 cards. I would sort first by type of product, then size, length, material, drive recess and so forth. Finally, I typed the Surplus Directory and our company which had a printing department, produced the first NFDA Surplus Directory. As I recall it was a so – so success! I am not sure, but I think this was the only time that the NFDA produced a Surplus Directory.
I am not sure exactly when the first Nationwide Surplus Fastener Directory was printed, but I think sometime around the early 1970s and was one reason the NFDA Board of Directors wanted to publish their own surplus directory as a membership benefit. The “Surplus Book” as it was called was about 4” thick and had a tremendous amount of surplus fasteners from distributors across the country, but with a strong following from Chicago distributors. I personally used the book very often through the 1970s and early 80s. As is typical with all printed Surplus Books, the lists becomes outdated shortly after publication and this fact alone causes a lot of aggravation, plus lost time.
Another major problem, I believe is that some companies that list surplus fasteners are just using the book for sales leads. They state they have so many of a certain type of fastener in the book, but when a potential buyer inquires, they state, “Oh we are out stock, but we can make them for you and ship you in two weeks!” Those are NOT surplus fasteners!
The “Book” is still in publication, but now on-line. I believe the problems or negatives mentioned above have been solved, but as I am not a member I cannot say for sure. I do believe it is now “printed” on-line over a two year period, like 2018-2019. It is free for qualified distributors to review the listings on-line.
For companies listing their surplus on the Nationwide Directory there is an annual fee of $399.00 to list products up to 500 line items and then $1.50 each thereafter; plus an aggressive advertising fee for the amount of pages involved range from $300.00 to $500.00. Since I am not a qualified distributor, I cannot provide any more additional information.
Going back to the 1970s, I was fortunate enough to buy four semi-truck loads or approximately 150,000 pounds of SPS socket screws and headed blanks for $.15 a pound, delivered. I sold all the blanks to a company that would cut and thread them as required by their customers. The balance of the sockets, which ran from 0-80 up to 1 ½ diameter, with all the different head styles and Stripper Bolts in both alloy and stainless steel. A nice assortment of the inventory had a nylon pellet were also included. Some of the inventory meet the non-standard length socket cap screws; which the discount at the time was 32% off an inflated list price. Needless to say, this was where I really learned the value of surplus fasteners for a fastener distributor!
At about this same time, the Defense Supply Center in Columbus, Ohio handled all the surplus fasteners for the Defense Department. Upon notice of an up-coming auction I would go early to review the lots and determine which ones I would bid on and would pre-sale them to various fastener suppliers around the country based on winning the bid. The “Jesus” Nuts, Sikorsky Helicopter always won that bid! Today, to buy U.S. Government surplus fasteners, click on www.govplanet.com.
1980, Cold Headers in Chicago, changed the direction of their company somewhat and started to offer from STOCK; non-standard, “special” socket screws in odd increment lengths, odd diameters, extra-long lengths and a variety of materials. Again, a good example where a company has taken a specific fastener product category, added “special” features from the norm and became a unique supplier to what previously was called maybe “Surplus Fasteners”. Today, a term that might apply is Master Distributor; a trend that started 5 decades ago and still going strong today and in a good variety of different fastener product categories.
After I started the National Industrial Fastener Show in Columbus, Ohio in 1981, and the AFJ in 1983, I pretty much was out of the distribution business. I heard various stories over the years about surplus fastener lots, but they were of little interest as I was not a buyer or a seller.
Twenty years later, 2001, I started a weekly FAX service of Surplus Fasteners called the FAST-NER Sale of the Week. It was successful as the lists changed every week, were extremely accurate, priced to sell and sales were direct between buyer and seller with NO middle-man. Technology replaced the FAX and now we had to move into the Dot.com era.
About 2009, the Fastener Clearing House (FCH) started as a surplus fastener website. The Full Level Membership now runs $149.95 a quarter or $599.80 annually with a set-up fee to post 5K line items vs. the $399.00 for the Nationwide Fastener Directory for 500 line items. You can also post up to 50 line items for $19.95 a month with FCH. The problem is, FCH is serving two different types of customers. Surplus fastener buyers or the supplier who can list their full product lines with an estimated inventory and prices…in other words they have now posted their catalog on-line with prices! FCH is NO longer a true surplus fastener website!
June 2019, I am pleased to introduce another NEW feature on www.usfastenersources.com; a “REAL” Live Surplus Fastener Listing! Our site is different from the others! First off, there is NO commissions to be paid and NO middle man! You the Seller control your listings 100%! There is NO Limit to the number of items you can post in a year, but yes there is an annual fee of $239.00 to register as a Seller with a BONUS of three FREE banner ads the first year to attract more customers. There is NO fee for the Buyer to use the website!
Two things I ask, make your initial listing of a part worth a minimum of $100.00 and upon a sale it your responsibility to adjust the inventory level or delete the listing completely if sold-out. These two things make for a “REAL” Live Surplus Fastener Listing!
My final thoughts; everybody has some surplus, obsolete parts or slow-movers in their inventory. Very often people just put them in a corner in the back of the warehouse and try to forget about them. Most surplus parts are thought of as a “Pain in the Ass”, a real aggravation!
I say take a different attitude, and think of Surplus Fasteners as a Profit Center! Turn that inventory into CASH and make more room for “A” items. Price your items to sell, and to sell quickly if at all possible. If you lost a contract to a competitor on a “Special” part, don’t mope around about it, call them up and make a deal to get them out of your warehouse ASAP! This may be the only time or chance you have to get rite of them. Bottom line, you will feel better, your accountant will be “off your back”, the Boss will be Happy and the company Banker will be Pleased!
I have other comments that will help you sell your surplus. Just contact me a 602-793-2383 or email: email@example.com to discuss in much greater detail.
START today to improve your bottom line and cash position!
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