WD-40 Announces $7M in Supply Chain Cost Reductions in FY2026
WD-40 reported $7 million in supply chain cost savings in its 2026 fiscal year, driven by improved inventory management, logistics efficiencies and strategic sourcing efforts. President and CEO Steven Brass gave details on the results on the company’s Oct. 21 earnings call, citing the importance of operational improvements to managing costs in a turbulent global landscape.
The maker of maintenance and household products also made progress in reducing the amount of inventory it held in its network. Inventory fell to 95 days on hand, moving the company closer to its target of 90 days. The company’s annual report put the figure at 99 days in fiscal 2025.
Operating costs were under great pressure but savings were delivered. Earlier in the fiscal year, some speciality chemical inputs experienced cost increases of up to 100 percent due to rising oil prices and economic uncertainty related to the Iran war. Brass said the results showed the company’s supply chain held up against rising global volatility.
Margins Expansion through Optimisation of Distribution Network
WD-40 is also developing a broader supply chain strategy to create operational efficiencies and improve gross margins. An essential part of this strategy is to evaluate the locations of its distribution centres to cover minimum distances when distributing the products. The company then contracts out the operation of these facilities to third-party logistics providers (3PLs).
The model enables WD 40 to adjust its distribution network so as to minimise transportation costs and to increase efficiency in product deliveries.
The company also added a manufacturing partner in Europe during the fiscal year ended August 31, 2026. The move, along with strategic inventory investments, are designed to mitigate supply risks, preserve service levels and provide the business with greater flexibility to manage cost fluctuations.
Supply chain disruption cost pressures persist
WD-40 achieved its cost reduction goals, but ran into sourcing and transportation problems in FY2026. Iran war has led to hike in fuel prices and supply disruptions of raw materials which have affected some of its third party manufacturers.
Sometimes these problems have forced the company to seek alternative shipping routes to keep the goods flowing and mitigate the impact of supply chain disruptions.
That pressure looks set to continue into the current fiscal year. Cost management will remain a focus for the business as costs associated with oil-based inputs and freight are expected to remain high,” said Keith Stauffer, vice president of global finance.
Technology and AI are now key priorities for operations.
WD-40 is also investing in technology beyond its logistics and sourcing to enhance productivity throughout its operations.
In FY2026, the company expanded its enterprise resource planning (ERP) platform to two additional direct markets. It also fast-tracked adoption of systems with artificial intelligence, as part of its wider push to enhance business processes and operational performance.
In April, Brass told investors that WD-40 was using AI-augmented platforms, including Microsoft’s Dynamics 365, Salesforce and Atlas. The tools are part of the company’s broader technology strategy to enable more efficient processes and enhance the way its business operates.
WD-40 has delivered meaningful savings through inventory reductions, changes to its distribution network, strategic sourcing and digital transformation despite ongoing cost pressures. But freight and oil-related costs are expected to remain high, and the company’s ability to continue to improve efficiency and adapt its supply chain to changing market conditions will be key to sustaining these gains.
