SEGMENT INFORMATION

Grainger’s two reportable segments are the U.S. and Canada. The U.S. reportable segment reflects the results of Grainger's U.S. businesses. The Canada reportable segment reflects the results for Acklands-Grainger, Inc. and its subsidiaries. Other businesses include the endless assortment (single-channel online businesses), Zoro Tools, Inc. (Zoro) in the U.S. and MonotaRO Co. (MonotaRO) in Japan, and smaller high-tough, high-service businesses in Europe, Asia and Mexico. These businesses individually do not meet the criteria of a reportable segment. Operating segments generate revenue almost exclusively through the distribution of MRO supplies, as service revenues account for approximately 1% of total revenues for each operating segment.

The accounting policies of the segments are the same as those described in the summary of significant accounting policies. Intersegment transfer prices are established at external selling prices, less costs not incurred due to a related party sale. The segment results include certain centrally incurred costs for shared services that are charged to the segments based upon the relative level of service used by each operating segment.

Following is a summary of segment results (in millions of dollars):



	2018
	United States			Canada			Total Reportable Segments			Other businesses			Total
Total net sales	$	8,588		$	653		$	9,241		$	2,441		$	11,682
Intersegment net sales	(457		)	—			(457		)	(4		)	(461		)
Net sales to external customers	8,131			653			8,784			2,437			11,221

Segment operating earnings	1,338			(49		)	1,289			8			1,297



	2017
	United States			Canada			Total Reportable Segments			Other businesses			Total
Total net sales	$	7,960		$	753		$	8,713		$	2,120		$	10,833
Intersegment net sales	(404		)	—			(404		)	(4		)	(408		)
Net sales to external customers	7,556			753			8,309			2,116			10,425

Segment operating earnings	1,200			(77		)	1,123			56			1,179



	2016
	United States			Canada			Total Reportable Segments			Other businesses			Total
Total net sales	$	7,870		$	734		$	8,604		$	1,885		$	10,489
Intersegment net sales	(348		)	—			(348		)	(4		)	(352		)
Net sales to external customers	7,522			734			8,256			1,881			10,137

Segment operating earnings	1,269			(65		)	1,204			40			1,244

Following are reconciliations of the segment information with the consolidated totals per the Financial Statements (in millions of dollars):



	2018			2017			2016
Operating earnings:
Total operating earnings for reportable segments	$	1,289		$	1,123		$	1,204
Other businesses	8			56			40
Unallocated expenses	(139		)	(144		)	(131		)
Total consolidated operating earnings	$	1,158		$	1,035		$	1,113

Assets:
United States	$	2,496		$	2,310		$	2,275
Canada	188			279			286
Assets for reportable segments	$	2,684		$	2,589		$	2,561
Other current and noncurrent assets	2,879			3,033			2,959
Unallocated assets	310			182			174
Total consolidated assets	$	5,873		$	5,804		$	5,694

Depreciation and amortization:
United States	$	166		$	169		$	159
Canada	19			19			18
Depreciation and amortization for reportable segments	$	185		$	188		$	177
Other businesses and unallocated	49			53			46
Total consolidated depreciation and amortization	$	234		$	241		$	223

Additions to long-lived assets
United States	$	200		$	187		$	154
Canada	7			8			12
Additions to long-lived assets for reportable segments	$	207		$	195		$	166
Other businesses and unallocated	39			67			106
Total consolidated additions to long-lived assets	$	246		$	262		$	272



	2018		2017		2016
Revenue by geographic location:
United States	$	8,613	$	7,948	$	7,834
Canada	658		761		740
Other foreign countries	1,950		1,716		1,563
	$	11,221	$	10,425	$	10,137

Long-lived segment assets by geographic location:
United States	$	1,140	$	1,098	$	1,135
Canada	136		199		211
Other foreign countries	202		247		210
	$	1,478	$	1,544	$	1,556

Revenues are attributed to countries based on the ship-to location of the customer.

Segment and total consolidated operating earnings for the twelve months ended December 31, 2017 were restated for the implementation of ASU 2017-07. See Note 1 to the Financial Statements.

Unallocated expenses and eliminations primarily relate to the Company's headquarters support services and intercompany eliminations, which are not part of any reportable segment. Unallocated expenses include supply chain, product management and procurement, finance, communications, human resources, information systems, legal and compliance, internal audit and real estate. These services are provided in varying degrees to all businesses.

The Company is a broad-line distributor of MRO products and services. Products are regularly added and deleted from the Company's inventory. Accordingly, it would be impractical to provide sales information by product category due to the way the business is managed.

Assets for reportable segments include net accounts receivable and first-in, first-out inventory which are reported to the Company's Chief Operating Decision Maker. Other current and non-current assets include all other assets of the reportable segments. Unallocated assets are primarily comprised of non-operating cash and cash equivalents, property, buildings and equipment, net, and certain prepaid expenses related to the Company's headquarters support services.

Depreciation and amortization presented above includes depreciation of long-lived assets and amortization of capitalized software.