Grainger's products range from toilet paper rolls to ladders and safety equipment -- and everything in between. That's a recession-resistant business that's capable of generating impressive returns regardless of what's going on in the broad economy. After all, companies need to maintain their facilities even if sales are slowing.For that reason, competition is the biggest problem that Grainger faces right now. Switching costs are low in Grainger's business, and the firm's offerings can easily be found elsewhere -- two factors that take pricing power away from this firm. >>5 Big Stocks to Trade for Gains Still, the international one-stop-shop nature of Grainger's inventory means that customers are likely to turn to this firm if only for convenience. As long as Grainger can keep its costs as low or lower than its competition, the firm should have a palpable advantage. Expanding its offerings to each client should help Grainger to increase customer stickiness as well top-line sales.
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