Price/Cost Dynamics
Q: How will price/cost impact margins going forward?
A: Management acknowledged that inflation has been stickier than expected, with costs likely to be 1%-2% instead of the initially anticipated 0%-1%. They're implementing pricing actions effective May 1st to correct this, aiming to improve price/cost and end the year close to price/cost-neutral.

Inflation Impact on Pricing Strategy
Q: How is inflation affecting your pricing decisions?
A: Due to higher-than-expected inflation, they misjudged the timing of price increases and began lowering prices too quickly at the end of last year. They're now taking corrective pricing actions on May 1st to adjust for increased costs coming in slightly higher than anticipated.

SG&A Increases and Investment Spending
Q: What's behind the step-up in SG&A expenses this quarter?
A: The increase reflects continued investment in demand-generating growth engines like marketing and capacity. There were no one-time items; they remain diligent in controlling non-core spending, keeping those costs flat. They plan to maintain investment levels even if top-line growth doesn't pick up, focusing on long-term productivity improvements.

Capital Allocation Strategy
Q: Any changes to your capital allocation priorities?
A: Management intends to maintain their current strategy, returning excess cash to shareholders via dividends and share repurchases. They believe this approach provides financial flexibility and is efficient for both the company and shareholders.

Endless Assortment Segment Growth
Q: Any updates on Endless Assortment segment growth outlook?
A: Despite headwinds in the B2C portion, they still anticipate 7%-10% constant currency growth for the year. They expect the consumer segment headwinds to ease in the second half, potentially becoming a positive.

Currency Impact on MonotaRO's Margins
Q: How does the yen's fluctuation impact MonotaRO's margins?
A: The majority of MonotaRO's costs are in yen, with a smaller portion in U.S. dollars. They've effectively passed on inflation through pricing to account for currency differences. The company doesn't hedge translation risk, viewing it as non-economic.

Customer Growth Initiatives for Zoro
Q: How are you increasing repeat business with Zoro's core B2B customers?
A: They've improved repeat purchase rates through targeted marketing efforts, presenting the right products and offers after the first order. Collaboration between the U.S. and Japanese teams has helped transfer best practices, showing good results over the last six months.

Midsize Customer Growth Strategy
Q: What's your plan for increasing penetration with midsize customers?
A: After regaining share lost prior to the 2017 price change, they're growing faster with midsize customers than large ones. Initiatives like marketing and merchandising have been effective, and they expect this trend to continue.

Sales Growth Expectations and Volume vs. Pricing
Q: Any changes in your sales growth expectations?
A: No significant changes; volume growth remains strong. While pricing has been lower than PPI, actions are being taken to adjust the pricing environment starting May 1st.

Customer Information Tool Impact
Q: How is the customer information tool impacting your business?
A: The tool has been helpful in refining seller coverage and is being integrated into marketing processes. It's expected to enhance their ability to serve customers by providing better data in a market where customer information is often messy.

Impact of Holiday Timing on Sales
Q: How did holiday timing affect your sales?
A: The Good Friday holiday had about a $10 million impact in March. Some of this is expected to flow into April, with month-to-date sales up 5.7% excluding FX and divestitures.

Impact of Weather on Sales
Q: Did weather affect your quarterly performance?
A: January weather caused a slower start but was immaterial for the overall quarter.

Utilities and Commercial Services Performance
Q: Why were utilities and commercial services down mid-single digits?
A: These sectors are relatively small for them, and performance was impacted by challenges with a single customer in utilities. They don't consider it indicative of broader sector trends.