How Applied Industrial Technologies Turned Bearings Into Robots

Part of Distributor Playbooks — strategy teardowns of every company on the 2025 MDM Top Distributors lists.

Applied Industrial Technologies opened for business in Cleveland in 1923 selling replacement bearings for cars and trucks. A century later it shows up on six separate categories of MDM's 2025 Top Distributors report, the industry's annual ranking of North America's largest wholesale distributors. That spread across six verticals, rather than dominance in one, is the tell. Applied did not become big by being everything to everyone. It became big by picking fights it could win and quietly financing a second business inside the first.

Six lists, one pattern

Per MDM's 2025 report, Applied ranks No. 1 in Fluid Power, No. 2 in Power Transmission/Bearings, No. 7 in Industrial Supplies, No. 11 in MRO, No. 10 in Fasteners, and No. 7 in Industrial PVF, on 2024 revenue of $4.7 billion. MDM has also named Applied an Industry Titan twice over, its designation for companies holding a top-three spot in a category for five straight years or longer.

Notice what is missing: a No. 1 or No. 2 in the broad, catch-all MRO or Industrial Supplies categories, the lists Grainger and Fastenal dominate. Applied's top rankings cluster in the technical, engineered categories, fluid power and power transmission, where product knowledge and application engineering matter more than shelf breadth. That is not an accident of the market. It is the strategy.

From Ohio Ball Bearing Co. to a hundred-year-old name change

Joseph M. Bruening founded the company as the Ohio Ball Bearing Company in Cleveland on January 11, 1923, selling bearings for the auto trade before pivoting toward industrial customers within a year, according to Applied's own 100-year anniversary release. The company renamed itself Bearings, Inc. in 1953, the same year it first listed on the American Stock Exchange. It did not become Applied Industrial Technologies until 1997, a rename meant to signal that bearings were no longer the whole story. That 1997 name change is worth dwelling on: it happened decades before the current automation push, which means diversifying beyond a single product category is a recurring instinct at this company, not a recent pivot forced by circumstance.

The real pivot: buying its way into robotics

The current chapter of that instinct is automation. Over the past several years Applied has bought a string of small, technical integrators rather than one transformative deal: Automation Inc., a Minneapolis motion-and-machine-vision distributor founded in 1981, in late 2022; Advanced Motion Systems the same year; Bearing Distributors, Inc. and Cangro Industries in September 2023; and Grupo Kopar, a 16-location robotics and machine-vision integrator based in Monterrey, Mexico, in May 2024, adding roughly 200 associates and about $60 million in expected first-year sales. Then came the biggest bolt-on: Hydradyne, LLC, a Dallas-based fluid power and automation specialist, closed December 31, 2024, expected to add about $260 million in sales and $30 million in EBITDA.

None of these deals alone would make headlines. Stacked together, they have built Engineered Solutions, the segment housing automation, fluid power, and flow control, into roughly a third of company revenue. In fiscal 2025's fourth quarter, CEO Neil Schrimsher credited Engineered Solutions with executing "exceptionally well" and capitalizing on firming automation demand, as full-year sales reached $4.6 billion, net income $393.0 million, and free cash flow hit a company record.

The unglamorous half is the funding engine

Here is the part that does not show up on an About page. Engineered Solutions and the century-old Service Center distribution business, the branch network selling bearings, power transmission parts, and MRO supplies out of more than 400 local locations, run at roughly comparable EBITDA margins in the low-to-mid teens. That parity matters strategically. It means Applied is not milking its legacy branch business to bankroll a money-losing side bet on robotics. Both halves earn their keep, and the branch network's steady, recession-resistant cash flow gives the company the balance sheet room to keep bolting on automation integrators, deal after modest deal, without betting the company on any single acquisition. It is a rollup funded by boring, reliable distribution economics rather than by debt-fueled ambition.

The trade-off nobody puts in the press release

Rolling up two dozen small, founder-led automation integrators carries a real risk: each one was built on a handful of engineers with deep, local customer relationships, and that kind of technical trust does not always survive being folded into a national branch structure. Applied's bet is that its distribution scale, purchasing power, and cross-selling into its existing MRO customer base will outweigh whatever entrepreneurial edge gets lost in integration. The mid-pack rankings in broad MRO and Industrial Supplies (No. 11 and No. 7) suggest the company is comfortable not winning that fight at all, ceding the everything-store model to Grainger and Fastenal while it consolidates the narrower, higher-skill categories where it already leads.

A hundred years after a Cleveland bearings shop opened its doors, the throughline is still the same: know exactly which fight you're in, and never assume the parts business and the engineering business have to be separate ambitions.

This profile is part of an ongoing series examining the strategic choices behind North America's largest distributors, the branch networks, catalogs, and logistics that quietly keep industry running.