DispenseSource(R) Enables Mahar Tool Supply to Extend Cost-Cutting Value Proposition to Customers; Mahar Tool Supply Utilizes DispenseSource Smart Inventory Solutions as Key Element in MRO Management Program

IRVINE, Calif.--Aug. 31, 2006--DispenseSource, Inc., a leading provider of MRO inventory management solutions for the industrial market, today announced that Mahar Tool Supply has adopted the company's Smart Inventory Manager and Point-of-Use (POU) dispensing technology solutions to expand its Tool Management Service.

"Mahar's value proposition directly attacks the customer's manufacturing costs," said Chris Clarambeau, System Development Manager for Mahar Tool Supply. "Many companies are not applying LEAN manufacturing principles when managing their cutting tools or MRO supplies. DispenseSource gives us the technology we need to implement MRO Management Programs designed to reduce cost and waste."

Mahar Tool Supply is based in Saginaw, Michigan with branch facilities in Cadillac and Madison Heights, Michigan; Muncie and Warsaw, Indiana; and Kenosha, Wisconsin. The company specializes in the distribution of metal removal products, industrial tooling and commodity management programs. Mahar's manufacturing customer base includes automotive OEM's and Tier 2/Tier 3 suppliers to automotive, aerospace, medical, RV, and farm implement/heavy equipment industries. Mahar provides tool management services and now offers MRO management programs aimed at controlling costs by managing procurement and consumption functions.

"DispenseSource values its relationship with Mahar Tool Supply and we're pleased to be such a key piece of their value proposition to customers," said Michael Blough, executive vice president of sales for DispenseSource. "We are happy to see the success their customers are experiencing with the use of our systems and confident this will translate into a long-term mutually beneficial relationship with Mahar."

Mahar Tool Supply has five customers using DispenseSource's Smart Inventory Solutions, which include inventory management software and point-of-use (POU) dispensing technology. A combination of DispenseSource's SecureSource, SmartCrib and SmartScan dispensing systems are installed to enable Mahar's customers to automate enforcement of access policies. At the core of Mahar's cost-cutting value proposition to its customers is DispenseSource's Smart Inventory Manager (SIM) which reduces spot-buys and ensures the right tools are in the right place at the right time by providing real-time, plant-wide visibility of MRO inventory.

Utilizing this data, Mahar's engineering teams can make better decisions on purchasing, inventory management, and identify the most cost effective cutting tools for the manufacturing application. The SIM is a robust Web-hosted inventory management solution that enforces business rules, controls access at the point-of-use (POU) and provides enterprise-wide inventory visibility which eliminates pilferage, stock-outs, and overstocking.

Point-of-use dispensing technology allows controlled access of materials and ensures high-value, critical MRO items are readily available to employees 24/7. SecureSource combines carousel and locker modules to provide flexible configuration options for single-item dispensing. SmartCrib offers coil-based dispensing for high-volume safety and general equipment. SmartScan enables tracking of items dispensed from open bin locations.

To learn more about Mahar Tool Supply, please visit www.mahartool.com.

About DispenseSource, Inc.

Established in 1999, DispenseSource is a leader in providing inventory management solutions for the industrial marketplace, specifically in the area of maintenance, repair and operations (MRO). The company's solutions help companies decrease consumption, reduce labor, streamline customer-generated reordering and provide total inventory visibility, all while providing users with a steady flow of supplies needed to perform their jobs. DispenseSource has established a strong installed base in many Fortune 500 companies throughout the United States, Canada and Mexico. www.dispensesource.com.