Page 1

The Official Publication of the Gases and Welding Distributors Association

TALES FROM The Sales Floor

275+

Years!?

E ROUNDTA B L

:

r Maximizing Youess c Sales Floor Suc

ANNUAL CONVENTION

PREVIEW INSIDE SMC ’17

The Big Boca Recap

Third Quarter 2017

CONSULTANTS

Dollar Stakes of DOT Audits

MEMBER PROFILE

Industrial Source: I-5 Powerhouse

ITR FOR GAWDA

Economy Still In Expansion


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c o nt e n t s

Third Quarter • Summer 2017 • Volume 16, No. 3

DEPARTMENTS 06

Tales From The Sales Floor

PRESIDENT’S VIEW New Communications, Technologies Creating Added Value for Members

BY MARK RAIMY



DIRECTOR’S DESK GAWDA Web Site Usability Review Underway

10

14

BY JOHN OSPINA

12

114

 ROM THE EDITOR F ‘Sales Appeal’ A Factor In Showroom Success

Handling Sales Objections

BY DIANE STIRLING

GAWDA CONSULTANTS 52

60

ITR Economics View: Happy Days Still Here

COVER STORIES

BY ALAN BEAULIEU

14

 aintaining the Industry’s M Hard-Won Medical Gases Reputation

62

BY THOMAS L. BADSTUBNER

72

The Dollars at Stake As DOT Audits Increase

64

BY RICHARD P. SCHWEITZER, ESQ.

INDUSTRIAL SOURCE I-5 Growth Creates Northwest Powerhouse

CELEBRATING LONGEVITY Anniversaries: Occasions to Enjoy What’s Worked Well

BY CHARLES McCHESNEY

FEATURES: SALES SUCCESS 32

GAWDA MEMBER PROFILE 66

BY DIANE STIRLING

BY MICHAEL DODD

Getting Drivers Ready For the New ELD Rule

 OUNDTABLE: TALES FROM THE SALES FLOOR R From Remodels to Amped Displays, Five Distributors Describe Their Revved-Up Sales Efforts

BY AGNES H. BAKER

STAY CONNECTED

www.WeldingAndGasesToday.org

2 • Summer 2017

 ustomer Centricity: The Magic That Makes C For A Magnetic Manufacturer-Distributor Bond

BY JOHN FAVALO

40

In Prospecting, T.A.R.G.E.T. Your Sales Message

BY RYAN DOHRN

44

1-2-3 Steps to Handle Sales Objections

BY KELLY WIRGES

BY JON DENNEY

48

Beyond Sales, How ‘3P’s’ Can Boost Profits

50

Who, Me? Creating a DIY Website

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c o nt e n t s

Third Quarter • Summer 2017 • Volume 16, No. 3

BACK OF THE BOOK 97

NEW MEMBERS

102

INDUSTRY NEWS

107

INDUSTRY CALENDAR

108

MERGERS & ACQUISITIONS

109

IN MEMORIAM

111

NEW OFFERINGS

112

ADVERTISERS INDEX

SMC RECAP 90

THE TEAM EXECUTIVE EDITOR

John Ospina jospina@gawda.org PUBLISHER

Bill Brod billbrod@datakey.org EDITOR IN CHIEF

GAWDA GUEST VIEWS 98

Diane Stirling dianes@datakey.org SENIOR EDITOR

HUMAN RESOURCES The Sky-High Cost of Disengaged Employees

100

Charles McChesney charles@datakey.org

BY MIKE HILL

BEST PRACTICES Conversations: Tools to Build Your Brand

BY JEREMY MILLER

CONTRIBUTING EDITOR

Natasha Alexis nalexis@gawda.org

FROM GAWDA HQ

CONTRIBUTING WRITER

90

ANNUAL CONVENTION PREVIEW Fall 2017 Schedule and Presenters

92

 MC 2017 S The BIG Boca Recap

Agnes H. Baker CREATIVE SERVICES MANAGER

Robin Turk robint@datakey.org VICE PRESIDENT, SALES

Tim Hudson timh@datakey.org

96

REGIONAL MEETINGS Season Continues Through September

110

HERE’S WHAT’S APP-ENING Practical Industry Apps

Welding & Gases Today (USPS 22-975) is published quarterly: Winter, Spring, Summer and Fall, with additional publications in Spring and Summer. • Non-member subscription rate is $195 per year. • GAWDA members (key contacts and branch locations) receive the magazine as part of their dues. • GAWDA members can order additional yearly subscriptions (4 issues) for $40. • Welding & Gases Today is published by Data Key Communications, Inc. on behalf of the Gases and Welding Distributors Association. • Periodicals postage paid at Ft. Lauderdale, FL, and at additional mailing offices (ISSN 1558-5344). • Editorial correspondence should be sent to Editors c/o editor@WeldingAndGasesToday.org. • Advertising correspondence and materials should be sent to William Brod, Data Key Communications, Inc., 1415 W. Genesee St., Syracuse, NY 13204; telephone (315) 445-2347, fax (315) 422-1721. • Postmaster: Send address changes to Welding & Gases Today, Gases and Welding Distributors Association, One Oakwood Blvd, Suite 195, Hollywood, FL 33020 • Welding & Gases Today is the official journal of the Gases and Welding Distributors Association (GAWDA) and carries news and announcements concerning GAWDA. • It is not responsible for contents or opinions other than association activities. • Contents are copyright ©2017 Data Key Communications, Inc. • All rights reserved. • Nothing may be reproduced in whole or in part without written permission of the publisher. • Questions and comments can be sent via e-mail to Editors, c/o editor@WeldingAndGasesToday.org. • Data Key Communications, Inc. reserves the right to print portions of all or any correspondence mailed to the editors without liability on its part and no such correspondence will be returned. • Visit Welding & Gases Today Online at www.WeldingAndGasesToday.org.

4 • Summer 2017


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P RESIDENT’S VIEW

Technology, Changes Helping to Make GAWDA Even Better by mark raimy

W Mark Raimy is GAWDA’s 2016-2017 president and chief executive officer of the family’s thirdgeneration business, Welders Supply Co., Inc. – a Raimy Corporation. The company’s two locations are in Erie Pa., its headquarters site, with a branch in Jamestown, N.Y. He can be reached at mhr@wscrc.com and at 814-454-1563.

6 • Summer 2017

hen the year began, we talked about making changes and utilizing technology to make GAWDA membership even better. A fair amount of what we discussed was on display leading up to and during the Spring Management Conference in Boca Raton, Fla. We tried out new channels of communications. There were emails with links to videos, links to the prize program information and links to the electronic registration system. The registration system has shown how willing GAWDA members are to adopt technology. Ninety-five percent of registrations for the SMC were handled electronically. The videos, for which I want to thank George Ratermann, let us employ a little humor (and show off my surfing skills) to make sure everyone understood how much the SMC had to offer. It also was a way to try out new channels of communications, creating a foundation for delivering value to members through whatever device is handy to them. One of the highlights of the SMC was the Contact Booth Program. I have spent a good deal of time with the Contact Booth Committee and learned a great deal about how important this program is to suppliers, and how by attending distributors can get a great deal of value from the program as well. Our goal was to make the program as good as it could be, utilizing a variety of communications channels. GAWDA again used video, email and social media to communicate a tailored message to each side. You saw the result: A very well attended Contact Booth Program with suppliers and distributors getting together to the benefit of both. The SMC also saw the debut of our the new GAWDA Events app — and I want to thank the

very able GAWDA team for their good work on the app. People are quickly moving toward app-based notifications and away from email. A text, a tweet, a post, a pic, a YouTube video, Snapchat, Instagram, WhatsApp or a GAWDA app notification are the future. We’ll be utilizing the app at our Annual Convention in New York City and plan to use it more widely in the near future. If you are going to the Annual Convention, and haven’t downloaded the app yet, please do so.

GAWDA is at its best when we all get together and learn from each other. I hope you see a theme in these improvements. It can be a reactionary process when you see a competitor, supplier or peer put in a technology and you feel you need to keep up. How we approached everything the Association is doing with technology is to look at what it is we want to accomplish or make better. In these cases, it’s been about communicating. Better communications — whether with YouTube, the new app or even a well-attended Contact Booth Program — provides more value to all GAWDA members. That brings me to a member benefit that I would like to see expanded. Since the first quarter of this year, Welding & Gases Today has carried The GAWDA Industry Analysis Report that is provided to us by ITR Economics. These reports offer insights that are helpful in making strategic and day-to-day business decisions. The indicators included in the report are highly correlative and


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proprietary, and contract language protects our approach from being used by other organizations. We are now exploring the option to make the report even more specific to our industry by creating a GAWDA indicator, based on relevant public data and data from member companies. It would be a truly powerful tool for those in the gases and welding industry. You’ll be hearing more about it soon. I expect you can sense my excitement about what GAWDA has been able to accomplish already this year and what goals are still before us. If your schedule allows, I hope to see you at a Regional Meeting and at the Oct. 1-4 Annual Convention in New York City. As always, GAWDA is at its best when we all come together and learn from each other. And, as always, thank you for being a part of GAWDA.

DON’T FORGET TO DOWNLOAD THE GAWDA EVENTS APP

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Introduced at GAWDA’s 2017 Spring Management Conference, the GAWDA Events app was the nexus for information about the schedule and attendees. It provided a single place for tracking when meetings were about to start, where they were being held and – with access to shuttle locations as well as ride-hailing services – how to get there. By the time the conference closed, nearly 200 GAWDA members had downloaded the app, using it to check maps and connect with fellow attendees. GAWDA President Mark Raimy says the app will continue to be central at this fall’s Annual Convention in New York City. CHECK OUT MORE APPS ON PAGE 110


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DIRECTOR’S DESK

GAWDA Summer Projects Are In Full Swing by john ospina

A John Ospina is GAWDA’s executive director. He can be reached at GAWDA Headquarters in Hollywood, Fla., via telephone at 844-2513219 or via email at jospina@gawda.org.

10 • Summer 2017

s President Mark Raimy notes, GAWDA efforts this year are about better communications. We are employing new and existing technologies to achieve this, and through the summer months, we’ve undertaken the revamping of GAWDA’s web site as a major project to that end. The last web site redesign was in 2010, when the current GAWDA team assumed management of the association. At the outset, the site was very simple and clean. Services were added with time. For awhile, navigation worked well and members found information with relative ease. As more and more web pages, information and links were added to accommodate member needs, there was a drawback to those good steps. The drop-down menus became longer and it became more and more cumbersome for members to find what they needed. This year, President Raimy initiated the first phase of this project. We have begun to evaluate the scope of work needed to give the GAWDA site a more up-to-date look, improved functionality and more intuitive navigation. A website developer has been retained to work directly with the GAWDA team. We have been analyzing historical metrics to see which pages have the most traffic and which have little or none. This information, along with input from GAWDA leadership, was used to develop an initial design proposal, which was presented to the GAWDA Board of Directors for approval. President Raimy also is assigning an advisory committee to provide input to the GAWDA team and developer on updates to the proposed design and functionality plan. To begin, they will assess the web pages with low or no activity to determine their user relevance. This will help eliminate in-

formation that may no longer be relevant, while simplifying the navigation process. This group will continue to provide input throughout the project. We also want to receive direct input from our members. If you’ve been on the site recently, you may have noticed a pop-up window that asks, “Were you able to find the information you were looking for?” If you answer no, a second window that asks for more detail will appear.

With your help, the data we collect will provide a better understanding of what navigation problems users are experiencing. That will help determine if information is missing, if it’s present but not labeled in a way that’s intuitive to users or if it is present but requires too many clickthroughs to find. Next comes the creation of a road map for an improved web site experience. After the initial phase, we will determine next steps, including a process to ensure continuous improvement and optimal user experience. Thank you in advance for your input as we continue to move GAWDA forward for the benefit of our members and the industry.


F ROM THE EDITOR

Could Your Showroom Use More Sales Appeal? by diane stirling

W Diane Stirling is editor in chief of Welding & Gases Today. A career journalist, public relations practitioner, communications strategist and online content creator, she is part of the GAWDA Media team. Get in touch with her at dianes@datakey. org and 315-445-2347.

hat do customers see when they walk into your distributorship, and how does the way goods are organized, stocked and displayed convey your company’s service and brand? Those are the kinds of questions that helped us shape the main feature of this issue of Welding & Gases Today. The roundtable, “Tales from the Sales Floor,” starting on page 14, explores a variety of approaches that have resulted in sales success. As distributors well know, appearance and ease of access to products are critical aspects of retailing today, because customers can now buy welding machines and supplies at big-box stores or online ones. For a few GAWDA members, that competition factor was an impetus to store updates and renovations. Others tell how they use communication, events and other tactics to create differentiation that is appreciated as unique and added value. There is a great deal that goes into a store’s ability to trade on “sales appeal.” We learned from the five distributors who joined the discussion that the what, how and why of their efforts make great ideas that other distributors can easily adopt. We thank members General Air Service and Supply, Huber Supply Co. Inc., Lampton Welding Supply Co., Weiler Welding Co. and Welsco for participating. Continuing the sales theme in this issue, several notable experts offer views on other aspects of retailing, such as managing objections, prospecting customers and creating brand loyalty.

Nationally-known experts Kelly Wirges and Ryan Dohrn discuss their best practices. Branding expert John Favalo uses original research to illustrate why a customer-centric focus can create “a magnetic manufacturer-distributor bond.” Business consultant Jon Denney cites ways to find profits without pushing the sales team harder. Marketer Graeme Roberts presents a primer on the ease of do-it-yourself websites, while brand-builder Jeremy Miller contends that clever conversations are tools to spark customer engagement. And speaking of engagement, human resources professional Mike Hill lists some surprising statistics about employee disengagement – and how much that problem can harm a business. Also in this annual “Anniversaries” issue are highlights about the successes GAWDA members have enjoyed over many years. Companies we reached who are celebrating milestone years told us interesting stories about the basis of their longevity, plus what’s going on in their businesses today. As we look forward to the rest of summer, we’re also excited for fall’s Annual Convention. It’s another chance for us to meet and speak with as many of you as we can during those days. We’re interested to hear about you and your businesses and to learn what topics and issues you’d like to have us cover. That interface is in part how we fulfill GAWDA Media’s mission of providing news and information that helps you maintain and grow your business success. We’ll see you soon!

Today on Twitter! s se a G & g in ld e Follow W y @WeldGasToda IA D E M A D @GAW 12 • Summer 2017


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R O U N D TA B L E SALES FLOOR SUCCESS

TALES FROM

A customer

walks into a welding

supply store… and… What happens next?

The Sales Floor

Those moments can make or

break a hardgoods business... by diane stirling

W H AT YO U ’ V E G OT A N D H OW YO U F L A U N T I T CAN DICTATE YOUR DEGREE OF SALES FLOOR SUCCESS

A

nd what happens on the sales floor can be fully contingent on the kind of greeting received, the availability of the sought-after merchandise, the conditions of the showroom floor, the expertise of the salespeople who serve, the competitiveness of pricing and an array of other factors, including the fickleness of customers, as distributors well know. Some of those elements have a direct effect on the sale; other times, not so much. Buying decisions can be impulsive rather than carefully considered. Now and then, the elements that fuel a purchase are more esoteric in nature, hinging on the strength of a relationship, loyalty factors or ease of accessibility. Sales decisions sometimes come about through interest sparked at an open house, the ability to try a product before buying it and the potential of ongoing training assistance. The “what if” factors of sales floor success are what GAWDA hardgoods retailers deal with day in and day out, even as they

14 • Summer 2017

ponder the future of walk-in retail outlets. The manufacturers and suppliers of welding machines and hardgoods items are just as invested in the customer as distributor retailers are; both are dependent on how well sellers meet buyers’ needs and interests. So how do GAWDA members trade on their stores’ “sales appeal”? The next few pages present a roundtable discussion on that topic. Five diverse distributors offer their tips, insights and experience. They discuss innovations they’ve used to overhaul what they had, ideas to introduce new showroom features and taking a different view of what is offered to fulfill consumer needs. They share how these steps have helped assure that the sizable square footage dedicated to their sales floors results in corresponding revenues, and that their showrooms remain productive and sustainable components of their company’s business success.


R O U N D TA B L E SALES FLOOR SUCCESS

 HAT IS YOUR COMPANY’S PHILOSOPHY W ON MANAGING PRODUCT SALES AND MAKING USE OF THE RETAIL SHOWROOM FLOOR? AC PB It’s very important to us to have like items alongside like items so customers can make a clear choice. Many of our suppliers push their displays on us, understandably, but we have decided to remove almost all of them to make it easier for the customer to make a good buying decision. We have also designed and built our own machine displays to take up much less room and allow for 360-degree viewing and touching by the buyer. We also insist on having as much inventory as possible and maintaining full pegs. The No. 1 complaint among men in the U.S. is “stock outs.” Although it is impossible to carry everything, we try and make sure that the part or item is at least available in one of our stores or warehouse, so it can quickly get to the customer. We have a courier who travels between most of our locations daily. Sometimes the part can be in a customer’s hand the same day, even if it wasn’t in stock at the store the customer walked into.

AC We try to have things displayed so that it’s appealing to walk into the business. We’re currently remodeling almost all of our stores, putting new slat wall in to try to improve the appearance for our walk-in trade. Some of our stores are not heavy walk-in, but over the last year and a half, we’ve been doing total remodels. We’re removing gondola shelving and going all slat wall, increasing the openness and putting more machinery and equipment out on the floors. That allows us to put a whole lot more product in the same square footage, and it looks better than the old pegboard did.

PB CS We don’t treat counter sales as “just another thing we do” but as an important aspect of our operations in regard to sales and customer relations. Since each of our retail showrooms provides a good portion of total annual sales, we consider them a very important part of our company.

FEATURING Aaron Campbell Vice President - Sales WELSCO HQ: Little Rock, Ark. Chairman and CEO: Angela Harrison  OO: Adam Kohler C Branches: 14 – 13 in Arkansas, 1 in Oklahoma Aaron Campbell has spent 22 years in the welding and gases industry. He’s been with Welsco for 10 years. Prior to that, he worked for a small independent distributor in the Midwestern U.S., and for several years during and after college with Lowe’s.

Paul Bernier Marketing Director GENERAL AIR SERVICE AND SUPPLY CO. HQ: Denver, Colo. President: Brad Armstrong Branches: 7 in Colorado Paul Bernier has 20 years of experience in the welding and gases distribution industry. He’s been General Air’s marketing director for four years. He initially worked as an account manager for Portland Welding Supply in Maine, moving to Colorado in the same role for Airgas, where he stayed 13 years.

Corey Smith Regional Sales Manager HUBER SUPPLY CO., INC. HQ: Mason City, Iowa CEO: Loren Huber President: Douglas Huber Branches: 2 – Owatonna, Minn. and Ames, Iowa Corey Smith started working at Huber in 2010 on the dock as a fill technician. He then became a backup route driver, and in 2011, moved inside to counter sales. He next headed to Ames, Iowa, to scratch-start that branch location, then was named to his current position in 2012. Summer 2017 • 15


R O U N D TA B L E SALES FLOOR SUCCESS We’ve built a strong tradition since these [open houses] aren’t just a day for us to generate foot traffic and awareness; they are genuinely a customer appreciation day for us to say thank you.

FEATURING

- COREY SMITH

David Radominski Vice President/General Manager WEILER WELDING CO., INC. HQ: Dayton, Ohio CEO: James C. Weiler COO: Herbert G. Weiler III Branches: 6 – 5 in Ohio; 1 in Indiana David Radominski, trained as a mechanical engineer, worked as a manufacturing engineer for many years. He spent 15 years in the motion-control industry at Parker Hanifin, moving up the management ranks and specializing in the field of change management. He was recruited to Weiler Welding in 2013 to help the company with its new building and its consolidation efforts, and has remained there as general manager ever since.

Brad Lampton

Vice President of Sales LAMPTON WELDING SUPPLY CO., INC. HQ: Wichita, Kan.  hairman and CEO: Marvin C Lampton President: Guy Marlin Branches: 16 – 6 in Kansas; 8 in Oklahoma; 1 in Nebraska; 1 in Missouri

DR We want to create a positive experience that others will share. Our goal is to acknowledge all customers as soon as they walk into the showroom. This is our opportunity to build a relationship, if one doesn’t already exist. That includes conveniences and courtesies such as having a popcorn machine where customers can grab a handful of popcorn while they look around. We also give away coffee, and in the summer, free bags of ice and water. If you’re a contractor and you come into our nice, air-conditioned showroom, you can fill your cooler full of ice, take a few bottles of water and hang out for awhile.

DR BL

Brad Lampton has been in the industry full-time since the age of 23. As the third generation in the family business, he co-operates the company with his brother, Doug and their father. Brad oversees the Oklahoma, Kansas and Nebraska stores, while brother Doug, also a vice president, is in charge of four stores in the Tulsa, Okla. and Kansas City, Mo. markets.

16 • Summer 2017

We know that if we have the best service, affordable prices and products available on hand, we’ll be able to earn repeat business, as well as a strong reputation as the go-to place in town. We also use our showroom as a testing ground for new products. We can introduce a new brand or type of product we haven’t sold before, or rarely do, and get feedback before taking these out to our route customers. This helps us tell what works as far as sales tactics, and whether this is a product our customers actually want.

The way we use our retail showroom floor space is the first thing anyone’s going to notice when you walk in to a branch location – whether that is a customer or management. What catches my attention are these considerations: Do you have inventory, are you out of things, are there empty shelves or pegs on the slot board? Are current seasonal products on display? How is traffic flowing through the showroom? Showroom floor space is valuable and we need to make sure the correct products are on display and inventory appears available. When we create a new showroom floor, we aim to make it appealing, with great lighting, high ceilings and a lot of space to display products.


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R O U N D TA B L E SALES FLOOR SUCCESS

Before and after: General Air took a space that was cramped and cluttered (above) and moved product to the walls and machines apart and away (right) for a cleaner, more open look and feel in its Denver store. Photo: General Air.

HOW IS YOUR COMPANY’S PHILOSOPHY EXPRESSED IN THE WAY YOU PRESENT PRODUCTS – THEIR AVAILABILITY, THE EFFORT YOU PUT INTO DISPLAYS AND PROMOTION? AC PB A study by the Wharton School’s Jay H. Baker Retail Initiative and the Verde Group reveals that, “Men buy, women shop.” Most of our customers (85-90 percent) are men, so we have worked on our stores to cater to what men want – to get in and get out quickly, without any clutter along the way, and it better be in stock! And, if he finds what he’s looking for fast, a man might then take the time and look around for more to buy, because he won! We redesigned all of our stores to work this way – painted all the walls a dark charcoal color so the items stand out better in their colorful packaging; installed large, 6-inch lettered signs that depict the type of products in an area; designed our own user-friendly displays. 18 • Summer 2017

We produce fliers to coincide with in-store seasonal promotions. Our spring promotion had a construction theme to it, promoting discounted sale pricing on items such as generators, torch outfits, pipe and structural weld assist products, and safety products like hi viz vests, hard hats, rain suits, etc. At Christmas time, we produce an additional flier with ideas for gifts and stocking stuffers, as well as our regular winter promotion. We also offer some services that make our customers’ buying decisions happen easier and better. One service is, “try before you buy.” This allows customers to demo a machine to ensure it is what he is looking for and needs. Another promotion is offering a free four-hour welding class with any machine purchase.


R O U N D TA B L E SALES FLOOR SUCCESS

Welsco has invested more than $1 million to update the layouts and appearances of all its stores, seeing it as a necessary part of competing with online sales trends. The photo above shows the new standard. Center and bottom: There’s a striking difference between the “before” look of this corner at Welsco’s Jonesboro, Ark., store – and its appearance after a complete remodeling. Photos courtesy of Welsco.

AC We’re pretty open and we don’t micromanage. We allow our stores and managers to decide what they need to stock because every one of our markets is different. We want the store to be inviting and clean and we want the customer to be able to see something new. We rearrange product displays on occasion to make people look for things. We’re hoping that what they see that’s new is one of those higher-margin items. We wanted to improve the appearance of our stores, so the decision was made to make the change and get modern. The new generation of customers wants to see something that looks good. If they don’t see that, they’ll just go online and order what they want. That’s what we’re up against right now. For the customer, it’s a question of, are you going to go someplace that looks nice or go to a run-down old welding supply? We want to be more like what you expect to see when you walk into the big-box kind of place. Everybody’s having to update just as a method to combat some of that online selling. They say you have to spend money to make money. We’ve just completed a complete remodel, spending in excess of $100,000 for our biggest store. Another store is in total remodel at a cost of about $250,000. When we complete all our stores, the work will nose over $1 million. That doesn’t count the new store we just built (No. 14), in Jonesboro, Ark. Summer 2017 • 19


R O U N D TA B L E SALES FLOOR SUCCESS

Huber’s showroom features open, wide aisles that make it easier to walk through and to shop around for products. Photo courtesy of Huber Supply.

PB CS

DR BL

We don’t really try to reinvent the wheel, we just do whatever we can so customers think of us first. As a family-owned and -operated company, we feel our reputation is built on the level of personable and knowledgeable service we provide. That includes making sure our showrooms look top-notch and have a well-stocked supply of the products our customers prefer. We learn what our customers want and need and then keep those things on hand, including brands at different price points to provide options. We let customers know that if we don’t have exactly what they’re looking for, we’ll find it for them. Our showroom displays aren’t overcrowded, are easy to navigate through and provide a large portion of various stocking items.

DR If you are walking into our store, you need something. We take pride in saying, “we have it.” We utilize our endcaps to take advantage of vendor promotions and seasonal specials. All of our showrooms are equipped with kiosks. The kiosks run specific content which is designed to educate and entertain our customers. Each store manager is empowered to select content from our YouTube playlist that they feel is most effective. It seems to be popular; it’s like what you’d experience in other retail environments. 20 • Summer 2017

We want customers to see a lot of different products and make sure that the store shelves are fully stocked. We acknowledge the customer immediately. Then, we treat them as you would a guest in your home – offer coffee, water, a soft drink, ask, ‘What can we do for you, how can we help you, what are you looking for today?’ We steer them in the right direction and just converse with them. There’s nothing really tricky about it, it’s just providing great customer service. We’ve recently outgrown a number of locations and have had to build new buildings. We built four new buildings in the last three years – two within the past year. They’re all very similar, but what’s stocked is up to the branch manager and their vision of their customer base and what they want to see. We have a tremendously talented team at each of our 16 branches. Our branch managers are in tune with their market segments and customer base, allowing them to manage product sales and inventory at the branch level. It’s those guys who are doing these things, and they’ve done a tremendous job of growing their sales and outgrowing their buildings – that’s their success and their reward.

We have a Demonstration Lab which enables our customers to see [products] and allows for side-by-side comparisons, and we target-market to specific customers for our Demo Days promotions. - DAVID RADOMINSKI


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R O U N D TA B L E SALES FLOOR SUCCESS

WHAT IS YOUR BEST OR MOST SUCCESSFUL PROMOTION – OR THE TACTIC THAT INFLUENCED SHOWROOM SALES THE MOST? AC PB Events are our most successful promotions. We had the Miller Road Show here for two days in April; just under a thousand people showed up. Our store sales doubled and tripled previous records and we created many new customers. We promoted it through local TV commercials and radio ads targeted to men aged 16 - 64. We brought in a local car buff celebrity, invited other safety and welding vendors, served barbecue, handed out gift bags, had a live band and had giveaways, including a couple of welding machines. Other events have included hosting college football games at the Air Force Academy, tailgating with customers and treating them to Division One football; race viewing when our sponsored car is racing in NASCAR events, and safety barbecues on Friday afternoons at our stores, featuring many of our safety vendors and their new products.

Colorado-based General Air sponsors one of the state’s best known and respected NASCAR drivers and his car. That support reflects the high number of customers who like racing, and who enjoy seeing the driver and his car at store events, plus mingling in the pits at races. Pictured: Pueblo, Colo., employees Sam Segura (left) and Mike Reese.

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R O U N D TA B L E SALES FLOOR SUCCESS

Using little-employed ceiling space makes for a “monster” of a display at General Air – and an effective and eye-catching promotion for fall-protection equipment. Photo courtesy of General Air.

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Summer 2017 • 23


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Wooden counters have been a staple in many stores, but when Welsco decided to renovate their sites, they put in place a modernized, streamlined model (bottom) for the different image it projects. Photos courtesy Welsco.


DR “Demo Days.” We have a Demonstration Lab that enables enables our customers to see for themselves by allowing sideby-side comparisons. We target-market to specific customers for our Demo Days promotions. There are multiple Demo Days every year; we like to do one every quarter. We generate product interest in the Demo Days by employing multiple marketing strategies. They include using traditional sales leads from our sales funnel, mass marketing via multiple e-mail campaigns and flyers and handouts for all sales personnel. Additionally, our vendors are a key resource to the success of all Demo Days events. Depending on the size of the event, you can partner with the major suppliers; they bring in their fully loaded trucks and that helps bring legitimacy to the event. To bring new customers to the store, Weiler has partnered with the local food truck association and has scheduled food trucks on-site. The goal is to cross-market and heighten awareness of the company brand. It also provides an opportunity for nonregular customers to visit the store and see what the business has to offer. Photo courtesy of Weiler.

Upcoming Events

2017 ANNUAL CONVENTION October 1 – 4, 2017 Marriott Marquis New York, New York

2018 SMC May 6 – 8, 2018 St. Louis Union Station St. Louis, Missouri

2018 ANNUAL CONVENTION September 9-12, 2018 Sheraton Seattle Hotel Seattle, Washington Weiler’s demonstration lab is housed in a room off the sales floor, and customers can try out many types of equipment. At frequent demo days, the store invites vendors in so customers can meet and ask questions directly of supplier representatives. Photo courtesy of Weiler. Summer 2017 • 25


R O U N D TA B L E SALES FLOOR SUCCESS

PB CS We run promotions in the store and through our online retail site (weldingoutfitter.com) quite regularly. We use social media to spread news about sales, new products and product reviews and we boost ads to Facebook users. No one likes seeing the same spam email in their inbox each morning, so we use the technology Constant Contact tactfully, but this helps us reach local customers and anyone who signs up for email sales updates. Our Facebook page for weldingoutfitter.com has the most “Likes” of any online welding retail site in the nation – 52,000 to date. Still, one of the most successful things we do that affects showroom sales are annual open houses at our stores. Walk-in and route sales customers are invited to these one-day only events. We’ve built a strong tradition since these aren’t just a day for us to generate foot traffic and awareness; they are genuinely a customer appreciation day for us to say thank you. We offer free lunch and homemade liquid nitrogen ice cream (made right in front of show-goers), door prizes, welding/ cutting contests and entertainment. We once featured “Globe of Death” dirt bike riders onsite T E C H N O L O G Y

F O R

T H E

W E L D E R ’ S

W O R L D .

Welding as it should be.

ABIMIG AT

Huber Supply employees (l-r: Noreen Bergan, Laura Huber, Diane VerHoef) make ice cream with liquid nitrogen as a way to attract customers to events. Open houses are used as an awareness builder, sales tool and importantly, a customer thank-you. Photo courtesy of Huber Supply.

and hosted monster trucks and decommissioned tanks driving over junk cars, plus other forms of entertainment. These events bring people in for the show, and makes them think of us first when it comes to the supplies they need. Our flagship location, located in a town of about 27,000 residents, typically draws 2,500-3,000 people each year, all in one day.

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R O U N D TA B L E SALES FLOOR SUCCESS

106-8212 1/4 pg. 4C _3.375 x 4.375_Welding & Gases Today_Jan. 2017

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We once ran a promotion that if you buy a pair of welding gloves, you get a second pair for $1. We sold a lot of gloves! We didn’t make a lot of money, but we sold a lot of gloves, and that got people in the door. It was a “doorbuster” idea, a loss leader, you might say.

Top Left: Lampton’s McPherson store, one of its new buildings and a consistent performer, keeps product displays full at all times, arranging goods to provide utmost customer ease and convenience. Above: Lampton puts its machines in a “safe room,” a closed-off area away from the sales floor that’s quieter and less distracting for salespeople and customers. It’s also extra security for highticket items. Photos courtesy of Lampton Welding Supply.

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Summer 2017 • 27


R O U N D TA B L E SALES FLOOR SUCCESS

WHAT ADVICE DO YOU HAVE FOR SUCCESSFUL TACTICS THAT CAN INFORM AND HELP OTHER GAWDA COMPANIES? WHAT OTHER INSIGHTS CAN YOU OFFER ABOUT SALES FLOOR STRATEGY? AC

AC PB Improve your customer experience (CX)! This is the new marketing battleground, and since our customers have so many more choices on where to buy (internet), and they have much louder megaphones to voice their satisfaction or dissatisfaction (Google reviews), we at brick-and- mortar retail locations have to provide them with a great “customer experience.” It’s not price, product or promotion, now it’s convenience and service. It’s knowing your customer’s name, offering a free beverage refreshment and helping them through the whole buying process. We are working hard to train our associates and all new employees on the value of CX and what is best practice – and how customer service is not customer experience. This is so important now, since a new statistic (from a ComScore-UPS study) shows that 51 percent of U.S. consumers prefer to buy online now.

Modernize and maintain a clean and orderly sales floor. Put impulse items where people check out. I worked at a big-box retailer and what stuck with me was having impulse items at the point of checkout. We’ve rebuilt the sales counters at most of our stores, put in the same slat wall so we can hang things right at the counter. As we’ve all learned from the big-box stores, that’s where your margins are. We’re really pushing our outside force to direct customers to visit our stores, whether that’s for personal items or if they need to pick up something for work. Our biggest advertisements are those guys out there in the field … who spend their days out in the trenches calling on customers. Our first instinct is to tell customers we can bring their item to them on the next trip. We invite them to come to the store and look, because there is so much out there. It’s just a matter of trying to push them to the store, without being pushy.

PB CS Left and right above: The contrast of products displayed against dark slat-wall panels, coupled with large-scale sign lettering, helps customers find goods more easily. Pushing machines back toward the wall opens up floor space in General Air showrooms in Denver and Littleton, Colo. Photos courtesy of General Air. 28 • Summer 2017

Social media has really seemed to help us for both our brick-and-mortar store sales and weldingoutfitter.com. Sending out a post that reaches 52,000 people allows us to promote an item or service, notify people of an upcoming event or just to say thank you all across the nation.


R O U N D TA B L E SALES FLOOR SUCCESS

DR Training, training, and training. Our people have the knowledge to sell a wide variety of products. We have a senior employee as an internal trainer who shows the newer guys the ropes; he’s a key resource for us. We make use of a lot of online training. We encourage our folks to participate in training programs as part of their performance goals. We’re close to the Hobart School of Welding Technology, and they’re a key partner for us; the school has classes we send our folks to. There are schools at some of the majors that are on site, and we send our folks to those. If a new machine comes out, we’ll mandate that the manufacturer come out and show our guys the pros and cons of the machine. We’ve got the demo room, so we can bring people in. And we look for people to work for us who are thirsty for knowledge, people who have the passion to continue learning.

The Fairfield, Ohio, Weiler Welding sales floor is organized for efficiency. It uses all available wall, shelving and floor space to maximize visibility of products and make access easy. It’s a “supermarket shelving” approach that the company debuted in 1974, as shown in the inset photo. Photos courtesy of Weiler.

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We look for people to work with us who are thirsty for knowledge. - DAVID RADOMINSKI Weiler Welding has been in business since 1920. Back in 1974, Weiler Welding was arguably the first welding distributor to offer the innovative self-service supermarket approach to the industry. Weiler continues to embrace change. Within the past year, we jumped onboard with CNC plasma cutting tables. Prior to that we were kind of tentative about it, but we shored up our comfort zone as we continue to respond to the needs of our customers. We find where there’s a market, where there’s a demand, and where there’s a gap, and we’ve educated ourselves. We’ve made obligations to some of the manufacturers that we will support their products, and we continue to do well with those products.

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Summer 2017 • 29


R O U N D TA B L E SALES FLOOR SUCCESS

DR BL We put a new display in several locations to see if we could grow sales in products targeted to HVAC and plumbing contractors. We don’t have a large market share of solders and fluxes, so we made a trial run using one particular vendor to see if we could grow sales. We also have a fairly new specialty gas plant that manufactures a lot of our gases, and that’s helping us grow our gas business plus expand our market share as well.

I’ll even go ask [a customer], ‘How did we do? You didn’t leave with anything, did we have what you needed?’ I was trained to do that. I keep in contact with customers because they’re the lifeblood of our organization. I’ve got to know what they’re thinking. - BRAD LAMPTON

Lampton’s McPherson, Kan., store, one of its new buildings and a consistent performer, keeps product displays full at all times. Goods are arranged to provide utmost customer ease and convenience. Photo courtesy Lampton Welding.

We have a number of success stories from each branch, most involving point-of-purchase displays. We believe product displays and promotions can drive sales. Manufacturers are enhancing their product displays and marketing efforts at the showroom level to increase their sales and market share. They’re competing for floor space and end caps, much like you see at the grocery store. We believe rotating product displays at the counter every month or two, with often-used tools, has increased revenue at the retail level. 

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30 • Summer 2017


R O U N D TA B L E SALES FLOOR SUCCESS

Huber Supply’s big-tent expo, with vendor displays and things to do, attracts customers old and young. Photos courtesy of Huber Supply.

We shored up our comfort zone as we continue to respond to the needs of our customers. We find where there’s a market, where there’s a demand, and where there’s a gap, and we’ve educated ourselves. - DAVID RADOMINSKI

THANK YOU TO OUR ROUNDTABLE PARTICIPANTS

We’re really pushing our outside force to direct customers to visit our stores, whether that’s for personal items or if they need to pick up something for work. Our biggest advertisements are those guys out there in the field … who spend their days out in the trenches calling on customers. - AARON CAMPBELL

GAWDA and Welding & Gases Today appreciate the interest, participation and candor of the five distributor members who offered their insights, ideas, improvements, and especially their unvarnished photographs of “before and after” sales floor situations for this roundtable. Their comments and their photos greatly helped enliven the discussion. Their interest in sharing information is characteristic of GAWDA member organizations, and upholds one of GAWDA’s key missions: to help members make money and save money. Since we’d like to present future roundtables, we’re asking for reader suggestions for additional topics for presentation in the magazine in this discussion format, and for more member volunteers as participants. Do you have a topic you’d like to see explored? Would you like to be part of a future roundtable? If so, please email us (editor@weldingandgasestoday.org) or dianes@datakey.org) We’ll be pleased to consider recommendations as potential stories for future issues. Many thanks to the distributors who participated in this issue’s discussion.

Customer experience is the new marketing battleground. Since our customers have so many more choices on where to buy … we at brick-and-mortar retail locations have to provide them with a great customer experience. - PAUL BERNIER Summer 2017 • 31


GUEST VIEWS SALES SUCCESS

Customer Focus is the Magic for a Magnetic Bond Between Manufacturer and Distributor Research Shows Brand Loyalty-Building is Worth the Effort and Expense by john favalo

H John Favalo is executive vice president of Eric Mower + Associates’ Group B2B. He has worked for more than 35 years with many well-known national and international companies that sell through distribution. His work spans the spectrum from brand creation and building, new product development and launches, distributorrelationship programs, loyalty programs and more. Favalo can be reached at jfavalo@mower.com, 315-466-1000, and on LinkedIn.

ard-nosed or soft-hearted? Which is the business-to-business buyer when it comes to brand loyalty? And, how do distributors factor in the brand loyalty equation? I’m in the advertising business, and have been for more than 40 years. I’ve spent a lot of those years building brands. After all that time, you’d think questions like these wouldn’t get air time today: • Are brands really important to grizzled B2B buyers? • Is building brand preference worth the investment? • Should distributors play a key role in building the brands they carry or should they work on building their own businesses’ brands? Things haven’t changed that much since I started that work, and today, smart people still question the efficacy of brands, especially in business and trade categories like welding, construction and assembly. Here’s a question I get asked a lot: Is loyalty building worth the effort and expense? The answer is, “Hell, yeah,” if you define brand loyalty the way The Business Dictionary does: “…faithfulness of consumers to a particular brand, expressed through their repeat purchases, irrespective of the marketing pressure generated by the competing brands.” What brand or business wouldn’t want that level of customer relationship?

Both manufacturers and distributors must work to create strategic and economic value for the buyer’s business. 32 • Summer 2017

MANY OTHER BENEFITS There are other reasons to covet brand loyalty. According to long-recognized B2B marketing experts Philip Kotler and Waldemar Pfoertsch, the benefits of brand loyalty include: • Higher levels of repeat purchases • More willingness to try new products • Less time and investment to close a deal • Owning a larger share of customer spend • Willingness to pay a price premium • Less sensitivity to price increases • Advocacy Consulting firm Bain & Company adds more specific dimensions, saying that leaders in loyalty typically grow 4 percent to 8 percent above the market’s performance.

RESEARCH INSIGHTS At Eric Mower + Associates (EMA), we’ve done research that confirms the importance of brands, even for the most hard-nosed customers. EMA surveyed 400 B2B buyers in four different business/trade categories and asked questions about brands and their purchasing patterns. Our research confirms brand power. Here’s a sample of those respondents’ answers to our survey questions. To the question, “How influential is a strong brand name when it comes to purchasing materials and tools”: For materials: • 27 percent said “very influential” • 58 percent answered “somewhat influential.” For tools, the picture was even more positive: • 46 percent answered “very influential” • 51 percent said “somewhat influential.”


GUEST VIEWS SALES SUCCESS What is the TOP reason the brand of Building Materials is important to you? 20 Delivers the best results A brand I trust Value over price Time saver/ increases productivity Readily available where I shop It’s a brand I know American-made The customer requests it The product is made for professionals The brand is innovative Brand name is not important to me Inexpensive

TOTAL

4% Price

I buy the market leader/ best brand on the shelf

9% Convenience 13% Value

I always buy the same brand

4% Recommendations/requests

Recommended by peers

34% Familiarity/ past experiences 35% Performance/productivity

Recommended by store employee

Copyright 2017, Eric Mower + Associates

Going deeper, we asked what made brands important. The interesting chart above shows survey results.

BRAND STRENGTH Several factors contribute to brand strength, but the most important ones are results, trust and value. If a given brand can be trusted to deliver the best results, it will likely hold high value in the eyes and mind of the buyer. One B2B buyer we spoke to said: “Brands matter because they can represent values that are important to me and my customers. Values like reputation, dependability and warranty.

I even use recognized brand names as marketing tools with customers. I tell them I’m using first-grade products on their jobs and not cutting corners. And, I will pay more for quality products that last.” We believe brands have significant influence in the buyer’s journey and that they have appeal for both rational (e.g. performance) and emotional (e.g. trust) reasons.

WHOSE INVESTMENT? Our research convinces us that brands are worth the investment. But the question is, who should make that investment? Summer 2017 • 33


GUEST VIEWS SALES SUCCESS Why do you prefer?

LOWE’S (n=110)

HOME DEPOT (n=164)

10

20

30

40

DISTRIBUTOR (n=166)

50

60

70

80

57% 61% 60%

Convenience

60% 58%

Range of Products and Brands

49% 45% 48% 48%

Accessibility

35%

Customer Service

14% 75% 42% 45%

Volume of Inventory

34% 40% 40%

Lower Prices 22%

Relationships I’ve Built/ I Trust what they say

BUYING CYCLE INFLUENCE

14% 10% 70% 13% 10%

Knowledge

63% 33%

The Shopping Experience

Delivery

21% 31% 5% 5% 54% 11%

Credit Availability

Training

16% 37% 3% 4% 19%

Copyright 2017, Eric Mower + Associates

34 • Summer 2017

Conventional wisdom would dictate that the manufacturers/brand owners benefit most from brand strength and, therefore, should shoulder the responsibility and cost. Said another way, manufacturers invest in brands, distributors invest in relationships. One B2B buyer we spoke to reinforced the impact of distributor relationships. He said: “I prefer the personal relationship…you build trust… (distributors) help you out if you make a mistake…you can get a lot of help if you build a good relationship.” Another decision-maker responded: “By default, the (smaller buyer’s) brand loyalty will be to whatever brand is carried by his favorite distributor. On the commercial side…brand loyalty is both short-term and fluid. (Manufacturer) people and policies change very frequently…and the (buyer’s) loyalties shift with those policies.”

In some respects, distributors can be seen as more stable. Clearly, distributors carry a lot of weight. However, we wanted to know more specifically about distributors’ influence in the buying cycle. So, we surveyed those 400 buyers about why they preferred one source of products over another. The graph on the left shows what the group said. As it illustrates, distributors excel in delivering outstanding service, building relationships and having critical knowledge that the buyer can use. They also excel in providing product availability and delivery, credit and training. If distributors have a choice between investing in these qualities or building the brands of their lines, the best potential for return on that investment seems obvious. A distributor we spoke to noted: “(Buyers) rely on distributors to do a lot of heavy lifting like product options, stocking levels and training. For example,


GUEST VIEWS SALES SUCCESS small…outfits can’t afford to invest in a lot of inventory the way we can.”

VALUE AND COMPENSATION If in the buyer’s mind there is little differentiation between two brands, then there is little reason to be loyal to one or the other. In cases like this, it’s the distributor’s voice that rings true. So, wouldn’t distributors be better off building their own business’ brands than investing in building their manufacturers’ brands? This issue has swirled in the space between the channel/supplier relationship for years. Distributors believe they should be compensated for the value they deliver beyond being mere conduits for products. Yes, there is “ordinary” compensation in the difference between the manufacturer’s selling price to the distributor and what the buyer pays for it. But often, that margin is variable, and can be too little to compensate for what it cost the distributor to train a customer on the proper use of a product and on safety precautions, plus offer special job packaging, delivery and so on. There are, however, relationships in which distributors do earn more from manufacturers. One of our clients, for instance, offers its channel partners yearend rebates based upon annual volumes, plus incentives for joint marketing programs or promotions run during the year. The supplier also provides services that reduce the distributor’s costs if the distributor commits to stocking a minimum number of product lines from the supplier’s full range. One distributor we interviewed said this about “mutual loyalty”: “We have a loyalty relationship with some of our suppliers. For instance, (one) division has a tight focus on the GE brand. We try to push out the benefits we derive from this loyalty to our customers, in turn building loyalty with them.”

But, even these forms of compensation don’t solve all the problems. There is evidence that buyers will switch sources of supply rather than switch brands. L.E.K. is a management consulting firm that specializes in several business categories, one of them construction, a trade category. L.E.K found that during the building slump that followed the financial meltdown, contractors preferred switching channels to purchase trusted brands at promotional prices, rather than trading down to lower-priced products. Were I a distributor, I’d be thinking about how to project my value more aggressively.

LOYALTY FACTORS It’s clear to us that regardless of whether you’re a manufacturer wanting to build loyalty for your product brand or a distributor wanting to build loyalty to the business, creating more loyal customers is a challenge. So, what factors build loyalty? I’ve mentioned trust a few times. Obviously, if a buyer places his trust in a brand or a distributor, that goes a long way toward achieving loyalty. Bain & Company emphasizes true and meaningful differentiation. A product or brand must be different from competitors in a way that is obvious and consequen-

INNOVATIVE/ DIFFERENTIATED PRODUCTS

Brands must deliver products that are consistently better and smarter

PROMISE

Brand must deliver on its promises: e.g., reliability, consistency, availability, warranty

Building Brand Loyalty

DURABILITY

Brand must deliver products with longevity, “that endure over time”

SERVICE + RELATIONSHIP

Manufacturer or the channel must deliver 1:1 personal service and proactive relationship

Copyright 2017, Eric Mower + Associates

Summer 2017 • 35


Building loyalty is a collaboration between brand owners and distributors – the brand sellers – a partnership that leverages not only rational motivations like product innovation and performance, but also emotional drivers like trust and peace of mind.

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36 • Summer 2017

tial. And, so should a distributor. Many distributors carry the same brands, so when a buyer wants product brand XYZ, why should he pick you? You better have a good reason, otherwise, good luck. Our research indicates that loyalty building isn’t an “either/ or.” There’s no silver bullet.

BALANCING ACT Loyalty building requires a balance between brand owners and brand sellers. In our interviews with buyers we discovered four qualities that, in balance, make loyalty attainable. The figure on page 35 illustrates those four points, also in balance.

NO GOING IT ALONE It should be apparent that neither manufacturers nor distributors can do it alone. Brands and their manufacturers must focus on innovation and differentiation, along with durability. Distributors balance the equation with all aspects of service and, along with the manufacturer, deliver on the product or service promise – factoring in reliability, consistency, availability and warranty. Other aspects of this balanced equation are implied but no less important: • Both manufacturers and distributors must work to create strategic and economic value for the buyer’s business. • The buyer must see a quantifiable advantage that makes his business more competitive or more money. • Lastly, both brand and channel partner will gain loyalty if they, individually or collectively, simplify daily operations for the buyer, i.e. improve buyer’s work life. As is so often the case, there’s no one way. Building loyalty is a collaboration between brand owners and distributors ̶ the brand sellers. It’s a partnership that leverages not only rational motivations like product innovation and performance, but also emotional drivers like trust and peace of mind.


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GUEST VIEWS SALES SUCCESS THE CUSTOMER AS COMMON GROUND So, if achieving loyalty is a partnership where both manufacturers and distributors cooperate and benefit, what truly is the basis of a magnetic relationship? What’s the common denominator in the equation? In my opinion, the answer is simple, but not easy. It’s customer centricity. When the customer becomes the common bond ̶ the magnet that brings manufacturer and distributor together ̶ magic happens: • The manufacturer makes products that customers love and buy repeatedly because they were inspired by real needs and wants, and fueled by how that customer works and makes money. • The distributor becomes a brand’s real-time eyes and ears, going beyond great service and becoming customer advocates. • Together there is more than customer focus, there is more personal intimacy drawn from understanding the customer’s business situation and motivations. There is a mutual commitment to embrace the customer’s requirements for success and work in unison to achieve it.

Consulting firm Bain & Company… [says] leaders in loyalty typically grow 4 percent to 8 percent above the market’s performance. A former client of mine from the manufacturer side put it this way: “Loyalty builders need to be obsessive with the customer. Think of it this way, your marketing department is like a team of detectives. They need to understand the customer’s business, how it works, and how it makes a profit. Then, they need to address those things from the standpoints of products and services in a way that solves customer problems and helps the customers improve their businesses.” When manufacturers and distributors see each customer as their own, collectively, then purpose, passion and people become aligned with customer satisfaction and success. When the customer succeeds, and knows that an important part of that achievement is the partnership between distributor and manufacturer, loyalty to both is a matter of course, not luck or a mystery.

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ILMO continues to support their growth expectations For 15 years, the 40,000-sq.-ft. palletized, automated fill plant has served as the heart of operations at ILMO Products, Jacksonville, IL. The fill system was installed in 2001 and is recognized as one of Weldcoa’s earliest automated industrial-fill-plant installations. The high-volume automated fill plant, capable of filling more than 20,000 cylinders per month, has never missed a day of work thereby proving to be a wise investment for ILMO. The company knows a thing or two about investing with an eye towards the future as they were founded just over 103 years ago. In 1913 ILMO was known as Illinois Tire and Battery. Fast forward to 2016 when ILMO chose to reinvest in their continued success by upgrading the facility to Weldcoa’s latest cylinder filling technology.

Due Diligence Streamlines the Project

Completing such an upgrade often can at best interrupt production flow, and at worst can prompt customers to look to other suppliers to meet their needs. In ILMO’s case, no such disruption occurred. “That’s due to a lot of due diligence and pre-planning by Weldcoa and by our team as well,” says Renouf. “Even before Weldcoa quoted the project, the Weldcoa team visited our facility on several occasions, to take a close look at our operations and learn how we are set up to operate. They reviewed the equipment with us, and ensured that they only quoted us what we needed. We worked together to carefully plan the work flow, constantly reevaluating everything to cover every base and avoid any surprises during installation that could delay the project.”

O

“ ur business has continued to grow, primarily through spec gases and higher grade medical products. Accuracy and repeatability from the fill plant has been critical to that success, and Weldcoa’s support after the sale, which has been phenomenal, certainly contributed as well.” Clifton and his team at ILMO, along with Weldcoa’s support and guidance, developed a two-phase approach for equipping the plant for the next stage in its life. Phase 1: replace aging electronics, including the variable-frequency drives on its pumps and motors; and install a new pump control center. That work was completed in July 2016, “under budget and well in advance of the original completion date,” shares Matt Renouf, Director of Production for ILMO Products Company. Phase 2, slated for completion in 2018, will include new control panels at each fill station on the island, and new software to capture data from the island.

A Quick ROI

consumed. Also, VFDs improve load control of the pumps, allowing for smooth operation and acceleration, helping to prevent premature wear and tear. “We see the upgrade project as putting the love back into something that’s performed nobly for us, year after year,” says Matt Renouf. “The automated fill plant has paid for itself over and over; it was time to give it some love and attention.”

“We calculate a return on investment of less than 5 years on the new VFDs,” says Clifton, “thanks to the power savings alone that will result.” VFDs adjust motor rotation according to the requirements of the application; a 20% reduction in motor speed should result in about a 50% reduction in energy

In the end, the upgrade project that originally was expected to require ILMO to shut production down for four days took only 2.5 days, “because of the detailed planning and pre-work done,” says Clifton. “That led to the project being completed very efficiently, with less production interruption than expected and under budget. Now we have a completely reliable fill plant that will support our growth expectations for the next 10 to 15 years. We’re pumping more high-grade gases (medical and food mixes primarily) than ever before, and Weldcoa’s design allows us to do more of that, without having to add labor.

“The fact that Weldcoa stands behind what it builds and supports it diligently is not something that happens with everyone in this industry. We certainly appreciate that, and believe it’s a key ingredient to our longevity and success.” Jim Clifton, Fill Plant Manager at ILMO Products Company

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GUEST VIEWS SALES SUCCESS

T.A.R.G.E.T. Your Sales Message to Grow Results Meetings, Not Sales, Should Be Your Main Goal in Prospecting by ryan dorhn

T Ryan Dohrn is the founder of the sales consulting firm Brain Swell Media, author of “Selling Backwards,” and publisher of SalesTrainingWorld. com. He has worked in sales and marketing for more than 25 years, including roles at the New York Times Company and Disney/ABC TV.  He has trained more than 4,000 sales professionals in seven countries and is an internationally certified business coach and acclaimed speaker. He can be reached at: Ryan@BrainSwellMedia. com and 803-634-3886.

40 • Summer 2017

he key to your success in the world of sales is increasing the number of meetings you are granted by prospective clients. Developing an effective prospecting process can be the difference between life and death in your sales career. For me, the goal of prospecting is not to sell anything; I am just hoping to meet with a client via phone or in person for 20 minutes. That’s why my goal in prospecting is simply getting to a meeting. Period. If you are selling during the prospecting phase, you will greatly reduce your success. Over 25 years in sales and marketing, I have seen many prospecting plans from many unique angles. I also have identified five factors in the prospecting process that increase the chances of being granted a meeting with a prospective client. I call this my “T.A.R.G.E.T.” prospecting tool. I use this tool every day in writing prospecting emails and leaving voicemails for prospects. This tool breaks down into six pieces and each component builds on its previous piece. I’m sharing it with you here.

MY T.A.R.G.E.T. TOOL

I use a system that I call “T.A.R.G.E.T.” to keep me on track in prospecting. Let me explain it in detail. THE “T” IN T.A.R.G.E.T. STANDS FOR “TIME.” A person’s time is highly valuable to them each and every day. The fact that many other salespeople have wasted someone’s time is a main reason more prospects won’t grant you access to present to them. That said, when you target prospects, it’s imperative that you focus on not wasting their time in your prospecting emails and voicemails.

You want to articulate that you realize other sales people may have wasted their time, but you should be careful not to sound like all the other sellers who emailed them that day. Rather than using the trite, “I know that your time is valuable” or, “I want to be respectful of your time,” consider phrases such as, “I promise not to waste your time.” Or, “I’m sure other sales people in the past have wasted your time.” THE “A” IN T.A.R.G.E.T. STANDS FOR “AUTHENTIC.” Showing an authentic face to those you don’t know is critical to breaking the ice. People who are authentic are not afraid to admit their faults and they’re more focused on others than themselves. Authentic people truly want to help you. Consider how you can express authenticity in your emails and voicemails using phrases such as, “I truly feel that this idea will benefit you.” Or, “I have seen firsthand how this has benefited my other clients.” Or, “I have three clients like you that are seeing solid success working with us.” Or, “I fully recognize the fact that you do not know me.” Your authenticity is also further driven by your focus on all the points in the T.A.R.G.E.T. system I propose.

BE SURE YOU’RE RELEVANT NEXT IN LINE IS “R” AND IN THE T.A.R.G.E.T. SYSTEM IT STANDS FOR “RELEVANT.” There is nothing worse than receiving an irrelevant, generic sales email from someone you do not know. I am amazed that companies still continue to use this approach as a prospecting tool. It does not work — unless you email thousands of prospects — and even then, results are hit and miss. (Continued on next page.)


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GUEST VIEWS SALES SUCCESS

Time Authentic Relevant Go Ethical Tick-tock Instead, aim to quickly show relevance by pointing out a fact from the company’s website or social media page. (Make sure this doesn’t come off as creepy.) You might say, “before reaching out to you, I was doing some research on your website and saw that you have recently moved into the aviation industry.” Or, “while researching your company, I saw on your LinkedIn profile that we both worked for ABC Company.” The reality is that generic does not work. Relevant always wins. THE “G” IN T.A.R.G.E.T. STANDS FOR “GO.” This premise is simple: make your email focused and your prospect ready to move forward. I’m suggesting that you consider phrases such as, “I truly feel that I can help you with (blank). Can we chat for 20 minutes or less via phone Tuesday at 9 a.m., 11 a.m. or 3 p.m. EST?”

ETHICAL IS IMPORTANT THE “E” IN T.A.R.G.E.T. REPRESENTS “ETHICAL.” Have you ever received an email with a great subject line, and then opened the email to discover that you were tricked? The subject line is often the ethical barometer by which you are judged. It sets the tone for getting an email open or reply. Some of my favorite subject lines include the date that you want to meet the prospect and the name of your prospect’s competitor. (Check out my blog, 10 Great Sales Subject Lines 42 • Summer 2017

at: salestrainingworld.com/sales-training/10-sales-emailsubject-lines-to-get-anopen-read-and-reply/.) THE FINAL “T” IN T.A.R.G.E.T. STANDS FOR TICK-TOCK. This focuses on the best time to send a prospecting email, the time of day to send it to get a reply, and how to get maximum attention. For instance, we know that 10 a.m. and 2 p.m. are the most common times for meetings in corporate America, so these would be two times to avoid.

TIME YOUR EMAIL

What times of day are predictable for fewer meetings? 11:15 a.m. and 4:15 p.m. are two. That’s because not many meetings are booked at those times. I have seen a dramatic increase in email opens and replies during these two times of day. If you sell to an industry with a different schedule, like restaurants or contractors, you’ll need to alter your prospecting email times to coincide with your potential clients’ work day.

ONE FINAL POINT

Increasing the number of meetings that you are granted by prospective clients is the key to your success in the world of sales. Period. Without the meeting, you do not have a chance to present anything. Developing an effective prospecting process can be the difference between life and death in your sales career, and email is one step of that process.


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GUEST VIEWS SALES SUCCESS

Handling Sales Objections: It’s Easy as 1-2-3 Learn to Bridge, Pivot and Advance to Keep the Sales Process Going by kelly wirges

O Kelly Wirges, president and CEO of ProMax Training & Consulting, Inc., of Omaha, Neb., has helped hundreds of companies develop practical, customized solutions to retain, develop and align talent with business strategies and increase sales and revenue. She has authored 50 training programs and has trained more than 200,000 people to increase their success. She can be reached at Kelly@ ProMaxTraining.com and 800-898-0444.

bjections are a delicate part of the sales process. It’s vital that salespersons not attempt to “overcome” objections on the spot, and instead address them carefully and professionally. I advise salespersons to continue through the sales process when objections arise, carefully addressing them using a process and tactics that I call a “1-2-3, Bridge, Pivot and Advance” technique. First, the best way to avoid resistance is to anticipate and prepare for objections. Salespeople should practice addressing objections before meeting clients. If objections do arise, a prepared salesperson is ready to concentrate on listening to the prospect rather than being focused on how to respond. Salespeople that are too eager to “make their case,” can make prospects feel like they are being “sold” – and that sense can increase emotions and bring communication to a halt. Even though a prospect is objecting, he or she is providing valuable information and creating an opportunity to understand his or her concerns. Many sales representatives rush to share information they believe will change the prospect’s position. That approach can backfire and the opposite effect – a prospect becoming defensive – can occur. Instead, the salesperson should keep communication going, being careful not to overdo it. Here are my “easy-as-1-2-3” steps to addressing objections. They are: 1) Bridge, 2) Pivot and 3) Advance.

BRIDGE Build a bridge to defuse emotions and put prospects at ease by agreeing on an issue, complimenting them or using an empathy statement. When prospects raise objections, they expect a 44 • Summer 2017

rebuttal. Showing empathy, understanding and genuine concern lowers resistance and emotions. It also demonstrates that the salesperson is not going to launch into an attack or further attempt to sell. For salespeople, the bridge provides an opportunity to switch the attention to the information you are about to share. If they don’t incorporate a bridge, clients may be “locked” on their objections, distracting from the salesperson’s message. The first step is to agree. Any of these three statements will then help build a bridge: • “I agree; repeat customers are an ideal business situation.” • “I completely agree and that is exactly why you will love working with me.” • “You’re absolutely right and that is one of the greatest benefits of working with my company.” The next step is to compliment. Useful phrases include: • “I want to compliment you on exploring your options.” • “I want to compliment you on appreciating the importance of ...” • “I want to compliment you on building a successful company. The business owners I work with would love to be in your position!” As the third step, empathize. These statements show empathy: • “I can appreciate you are looking for the best value for your investment.” • “I understand your concern about finding an affordable plan that delivers results.” • “I appreciate you are considering all of your advertising options. If I were a business owner, I would do the same.”


GUEST VIEWS SALES SUCCESS “May I ask you a question?” “I am curious…?” / “Would you mind sharing…?” • “Would it be correct to assume …?” The Consult Pivot. This enlightens the prospect by providing research, product information or showing confidence in your products. To a prospect, this demonstrates value, piques interest and encourages discussions. You might try these phrases: • “One thing to consider is…” / “Please allow me to share with you…” • “Were you aware…?” / “Did you know…?” / “You might be surprised to learn…” • “I know I can help you with that…” / “I am certain we can find a solution for…” The Testimonial Pivot. Testimonials build confidence in the salesperson’s ability to help clients meet their goals. You could suggest: • “Some / many / a few customers have shared with me...” • “Successful business owners tell me…” • “My clients tell me…” / “Some of my best clients tell me…” • •

PIVOT

In step two, after easing the prospect’s concerns, a salesperson should share using any of the three types of pivot transitions to open a discussion. The Ask-a-Question Pivot. This keeps the discussion going by asking about specific information. The idea is to change the focus from concerns expressed to the value of your products and how you can help clients achieve their goals. Salespeople should remain calm and objective so prospects do not become defensive. Some sample statements are:

(Continued on next page.)

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GUEST VIEWS SALES SUCCESS ADVANCE After providing the necessary information and if no other objections exist, the salesperson can then advance the sale or encourage a meeting. Some phrases for this “closing the sale” stage are: • “Does that answer your question and make you feel confident in …?” • “Do you have any further questions or are you ready to move forward?” • “Is there anything else keeping us from moving forward with this strategy?” • “Here’s what we need to do to get started…” Salespersons can try these statements to lead prospects to a meeting: • “I would like to verify my understanding of the challenges you are facing, and share ideas to help you achieve your goals. We really should get together. Do you have time now or tomorrow at (time)?” • “Are you open to setting up a meeting to explore a few opportunities to increase your sales?”

“I would enjoy sharing information I have uncovered about your industry, as well as the ideas I have developed to help you increase sales. Are you available now, or can we set up a meeting?”

GO BACK IF YOU MUST If a prospect continues to object, salespersons should not continue sharing information. Instead, it’s time to go back to the “bridge” and “pivot” stages before progressing in the discussion. If the prospect is becoming agitated, there’s a different strategy. It’s then time to thank him or her for the opportunity provided, then confidently employ your “professional exit strategy” to keep the doors open and let the prospect know you will be back. While there is no foolproof method of addressing objections to earn every sale, I can confirm from years of following these steps, and coaching others to do the same, that these three steps lower defenses, open more discussions and ultimately, increase sales.

Know Someone Who Ought

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Membership application forms are available online for completion here: gawda.org/join-us/membership-categories. Anyone interested in additional information about membership may get in touch with GAWDA’s membership services manager Stephen Hill. Phone: 954-367-7728 ext. 220 Toll free: 844-251-3219 Email: shill@gawda.org

46 • Summer 2017

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* * *

* (one copy) * (one copy) * (one copy)

To learn more about other benefits of joining the Gases and To learn more about other benefits ofMembership joining the Gases and Welding Distributors Association call Services To learn more about other benefits of joining the Gases and Welding Distributors call Membership Services Manager Stephen HillAssociation at 954-367-7728 x220. Welding Distributors Association call Membership Services Manager Stephen Hill at 954-367-7728 x220. Manager Stephen Hill at 954-367-7728 x220.


GUEST VIEWS SALES SUCCESS

Beyond Sales, Look to the ‘3 P’s’ to Boost Profits

Adding Profits by Changing Pricing, Purchasing and Production Habits by jon denney

W Jon Denney heads the Professional Business Coaches Alliance, North America’s premier businesscoaches organization. He also operates an executive coaching consultancy, offering individual coaching for business owners plus strategic planning, group coaching, and leadership development services. In the past 10 years, he started and grew four different, profitable, multi-million dollar ventures. He’s at: Jon Denney Executive Coaching, LLC, Syracuse, N.Y. and: jon@jdenney. com; 315-952-9704.

48 • Summer 2017

here is the first place business leaders tend to focus when they decide that profits need a boost? It’s the sales team. Often, company leadership takes a critical eye toward the sales department and decides that the team needs to take it up a notch and make more sales happen. While that route certainly is one way to improve profits and increase profitability fairly immediately, it isn’t the only way. This recent exercise from a company I dealt with in my consultancy points out that there are alternative avenues to creating additional profits. They include focusing on what I call “the three P’s of profitability” – pricing, purchasing expenses and production costs. Let me explain how other operational aspects, above and beyond the amount of selling that’s being done, can lead to higher profits. I’ll use the example of “ABC Company” for two separate years. In year one, ABC Company had annual sales of $2.2 million and total annual expenses equaling $2.068 million. That left a net profit of $132,000 — a 6 percent net profit margin. Since the company’s average sales transaction (average invoice) was $1,000, that meant the business incurred about 2,200 sales transactions in the year. But the following year, the company changed things up: • They raised their pricing by 2.5 percent • That increased the average invoice from $1,000 to $1,025. Interestingly: • The company did not lose one piece of business from the price increase. • Annual profit increased by $55,000 ($2,200,000 x .025 = $55,000) from just that action.

Step 1 results: a 2.5 percent price increase earned a profit gain of $55,000.

EXAMINING LABOR COSTS Next, the company looked at its labor expenses more closely. It determined that: • Of $2,068,000 in total expenses, $1,116,720 was spent on production labor and production labor-related expenses (taxes, health insurance, workers’ compensation and unemployment insurance programs). • That data showed that the company’s production labor, as a percentage of sales, equaled 50.76 percent. (That meant for every dollar ABC Company invoiced customers in 2016, 51 cents of each dollar went directly to pay production labor costs.)

LOOKING AT WORK EFFICIENCY The company next focused on how its employees might help improve profitability. The leadership asked its production team to help boost profitability by changing employee work habits slightly, focusing on work efficiencies. The company: • Reasoned that an 8-hour shift = 480 minutes. • Determined that if every production team member could work a little faster, take a little less time on breaks, and work more efficiently, the company could probably pretty easily produce the same amount of work in 24 minutes less per shift. • Estimated that if employees were able to do smarter and more focused work, each person could produce the same amount of work in 456 minutes as they had been producing in 480 minutes per shift. This may sound self-serving until it’s revealed


GUEST VIEWS SALES SUCCESS how such changes impact productivity – thus profitability – by meaning not having to staff as heavily or doing the same work with fewer hours dedicated to labor. • 24 minutes saved per person per shift, divided by 480 (total minutes per shift) results in a 5 percent time savings. • A production efficiency improvement of 5 percent — thus a 5 percent reduction in production labor — equals a profitability increase of $55,836 ($1,116,720 x .05 = $55,836.) Step 2 results: a 5 percent reduction in production labor costs (24 minutes per person per 8-hour shift) earned a profit gain of $55,836 for the company.

ASSESSING EXPENSES Next, ABC Company reviewed all other expenses (as reflected on their annual income statement detail report). The company determined that about $500,000 in annual expenditures could either be reduced or eliminated. ABC then set a goal to reduce those costs by a total of $20,000 (4 percent) in the current year. It then reduced expenses by: • Renegotiating with longtime vendors • Competitively bidding supply purchases • Consolidating and refinancing loans • Eliminating unnecessary recurring charges • Eliminating marketing efforts that yielded no return • Negotiating fast-pay discounts for customers • Negotiating discounts for customers who paid by check instead of credit card • Cutting back on frivolous expenses.

Taking those steps, the company beat its goal of reducing expenses by 20 percent — reducing purchasing expenses by an additional 5 percent. That added a total monetary gain of $25,000 ($500,000 x .05 = $25,000) new profit. Step 3 results: a 5 percent reduction in purchasing costs earned a profit gain of $25,000. •

HOW IT ALL ADDS UP Taking into account all the people, purchasing and production changes it implemented, the company realized it had generated significant funds: • $55,000 resulting from the 2.5 percent price increase • $55,836 saved in production labor • $25,000 saved in purchasing costs All those actions resulted in an increase in the company’s total profits in the second year of $135,836. Fully apart from sales efforts, those three operational steps boosted the company’s annual profits to a new level — from $132,000 in 2016 to $267,836 ($132,000 plus the newly-found $135,836) — more than doubling them in one year. That is a profit gain of about 103 percent without having to sell a single item more than they did the prior year! While leadership typically focuses on the sales department as its first solution to increasing profits, this exercise shows that all departments and all functions are able to add profits to the bottom line through increased efficiency and decreased expenses. It’s a new way of looking at the whole picture – and it’s something your sales team will be very grateful that its company leadership is taking into account.

Summer 2017 • 49


GUEST VIEWS SALES SUCCESS

Consider a Build-It-Yourself Business Website Intelligent Software Makes Excellent Websites Easy and Inexpensive by graeme roberts

I Graeme Roberts is a writer and editor in Rochester, N.Y., specializing in marketing for technology companies. He can be reached at www. graemeroberts.com, graeme.roberts@ growmotor.com or 585-794-7807.

f a business calls, or we hear about it, we Google it. If we can’t find it immediately — near the top of the first page — that’s a big red flag. A hundred years ago, you wouldn’t put your money in a bank unless it had a grand stone building with columns. Today, we look for reassurance from a substantial website. Some distributors say they don’t need a website; most of their customers have been with them for years, and they’re like family. Fair enough, but what about new prospects, let alone the people who are applying for a job you have listed, or the new supplier you are trying to convince to come on board? They all need to see you online!

THE BAD OLD DAYS

Building and maintaining a website used to be expensive and time consuming, requiring the services of a designer, a programmer, and probably a photographer, a writer and project manager. Add in a decent profit, and even a simple site could cost tens of thousands of dollars. And not all communities had companies that did that work. Updating the site, which should happen frequently, could require more technical help and more money.

THE GOOD NEWS

Today, any proficient computer user can build and maintain a website, provided it is not too complicated. Online website builders like Squarespace, Weebly, and Wix have developed intelligent software that handles all the technical stuff, and guides users through the process. They offer templates, tailored to various businesses, that look great and work well. 50 • Summer 2017

I am not particularly technical, but I enjoyed building my business site on Squarespace, and I am delighted with the result. I can update the content myself any time. I pay a small monthly fee, and Squarespace takes care of everything.

WHAT MUST YOUR WEBSITE ACCOMPLISH?

You may be concerned that a website you built yourself might not be good enough. I listed the things that a website needs to accomplish, to see if a build-it-yourself website could measure up. It comes down to three things: build trust, deliver information, and (maybe) take orders. • Build Trust — We judge character from faces, so you need photographs, but people judge you primarily by suppliers and customers who trust you. List them, and get testimonials. • Deliver Information — What you sell, on what terms, how to use the products. • Take Orders — Most long-time distributors take orders in person or over the phone, but you may want to add e-commerce capabilities for ordering, especially on smartphones.

A REVOLUTION IN BUILDING SIMPLE WEBSITES

Everything on that list can be delivered successfully by a build-it-yourself site. Website companies used to tell us that a unique design, corporate brand identity, professional photography, and professional writing are essential to success. Not true! Many website companies are out of business, and some photographers are, too. Not that they weren’t good, but online website software showed we could do very well without


GUEST VIEWS SALES SUCCESS

them, at least for simple sites. (We are not talking about Amazon or Grainger here, with their complex e-commerce systems.)

the look when you’re finished, you can change templates as quick as a click.

LITTLE BY LITTLE

AN ACTIVE WEBSITE IS A HEALTHY WEBSITE

When you build your own site, you can do it little by little. Start with a basic set of pages and improve them as you learn and get feedback from users. If you want to take orders on the site, add that functionality when you have the experience. An active website is constantly improving.

YOU HAVE THE SKILLS

I am confident that you, someone in your company, or someone you know can do the job. If you need help, there are many inexpensive freelancers who can assist with layout, graphics and writing. Your suppliers can provide product and application photographs. You can find a huge range of stock photos online. Even smartphone shots can look remarkably good. The website builder companies provide lists of freelancers experienced with their software, and freelance sites, like Upwork, offer professionals in every possible category. Most people find that writing is the hardest part. There is a real art to saying a great deal in very few words. Most people write too much, and then no one reads it. I am happy to send you links to good articles on these subjects, as well as to answer questions, so don’t hesitate to contact me.

DON’T MESS WITH SUCCESS

The professional designers at the website builder companies have developed good-looking templates for almost every application, carefully combining colors, typefaces, and design styles that work together. Choose one, and don’t try to customize it, which can get messy fast. But if you don’t like

I used to ask businesses, “Do you have a website?” That was the wrong question. Now I ask, “Is your website active?” By that, I am asking a lot of questions at once: • Are your products and services up-to-date in every detail? • How about changes in the company team? • Did you list any changes under the “news” tab, and email that news out to your mailing list? Put it on your calendar to spend half an hour on your website every week, at 3:00 p.m. every Friday, or whatever. Review every page to check that it’s up-to-date and accurate, then fix it. And make sure that every bit of news and helpful advice is sent to everyone on your mailing list, and shown on the news page. I enjoy doing this, and I think you will, too.

CHECKLIST FOR BUILDING YOUR OWN WEBSITE

1. If you don’t have a website, build one. 2. Check out Squarespace, Wix, and Weebly website builder software online. 3. Learn and experiment with the software without publishing the site to the web. 4. Start with a simple site, and build up from there, little by little. 5. Get help, if you need it, from friends and freelancers. 6. Stick to a basic design, and don’t customize it. You can always change the template. 7. Update your website every week with features, news, and improvements. 8. Pat yourself on the back. Good job! Summer 2017 • 51


THE GAWDA INDUSTRY ANALYSIS REPORT Provided by ITR Economics™

HAPPY DAYS STILL HERE

INDUSTRIAL ECONOMY CONTINUES TO EXPAND Low Interest Rates and Rising Manufacturing Production Bring Growth

ABOUT THE GAWDASPECIFIC INDUSTRY REPORT

The ITR for GAWDA Industry Analysis Report is a customized quarterly economic report. As a service exclusive to GAWDA members, its customized content has been developed by ITR Economics’ principals and staff economists specifically to reflect the conditions, experiences and impacts in the welding and gases distribution industry. ITR develops its customized content using GAWDAspecific indicators, data extracted from the publicly filed information of GAWDA member companies and economic information related to the types of customers that are important to GAWDA members’ businesses. GAWDA’s goal in contracting the firm for these reports, and for other economic insights and information, is to provide members with practical, useful information to help them develop confidence in the business and economic conditions ahead and a solid basis for decision-making.

A

fter nearly a decade of slow economic growth, the U.S. economy is showing signs of robustness with industrial sectors

showing improvement across the board, according to the

latest quarterly report from ITR Economics. The economic analysis and

forecasting firm is headed by GAWDA Chief Economist Alan Beaulieu.

This content is The exclusive GAWDA ITR Leading to Indicator™ has risenMembers. for the 15th consecutive

month, signaling that U.S. industrial production is likely to rise. For more information on GAWDA Additionally, consumer confidence is on the upswing, suggesting retail and association membership, contact: sales will climb into 2018. Stephen Hill, GAWDA Membership Services This quarter’s report includes a charted Manager look at fabricated metals new orders as food production, two areas ITR expects to 954-367-7728 x well 220as/U.S. shill@gawda.org

52 • Summer 2017

see help drive economic growth for the next two years.

The details, along with charts and an explanation of the method-

ology used, are on the next several pages.

WELCOME TO THE ITR FOR GAWDA Q3 REPORT

Welcome to the third GAWDA Industry Analysis Report provided by ITR EconomicsTM. We are pleased to present this quarterly snapshot of the overall U.S. economy, and even more importantly, customized content developed specifically for you, a member company of the Gases and Welding Distributors Association. In this analysis, you will see terms such as “Rates-of-Change” and “Phases of the Business Cycle.” We highly encourage you to review the terminology and methodology segment of this report (on page 59) to ensure you receive the full benefit of the information being provided. Our goal is to provide members with the insight needed to create confidence and drive practical and profitable business decisions.


ITR FOR GAWDA

EXECUTIVE SUMMARY FOR GAWDA MEMBERS

Here is ITR Economics’ macroeconomic forecast for 2017 and recommendations about what GAWDA members should do about it. ■■ The U.S. economy will grow in 2017. Plan for increasing activity in the coming quarters. - Invest in hiring and retention plans as the labor supply tightens over the next year. - GAWDA members should ensure that their suppliers have capacity to meet rising demand into 2018 and evaluate the workflow to avoid bottlenecks.

GAWDA-SPECIFIC INDICATORS INDICATORS

CURRENT DIRECTION OF DATA TREND

CURRENT GROWTH PHASE RATE (12/12)

HIGHLIGHTS

Data Trend

U.S. INDUSTRIAL PRODUCTION INDEX

Production is recovering. Budget for increasing production costs, as rising commodity and labor costs will place upward pressure on production costs this year.

-0.4%

A

U.S. PROCESSED GOODS FOR INTERMEDIATE DEMAND PRODUCER PRICE INDEX

Prices are rising on an annual basis. Focus on operational efficiencies and cost-saving measures in order to increase profitabilty as prices increase this year.

.3%

B

U.S. CRUDE OIL FUTURES PRICES

Prices are generally rising. Budget for volatility in prices this year, as a result of global production fluctuating.

9.4%

B

U.S. NONDEFENSE CAPITAL GOODS NEW ORDERS WITHOUT AIRCRAFT

New orders nearing an accelerating growth trend. Take advantage of relatively-low interest rates to purchase the capital equipment necessary for increasing activity.

METALS NEW ORDERS

to understand what customers are looking for. Use that knowledge accordingly to gain market share.

U.S. DURABLE GOODS NEW ORDERS WITHOUT AIRCRAFT ITR LEADING INDICATOR™ (MONTHLY)

RATE-OF-CHANGE (12/12) 2006 – PRESENT Rate-of-Change

This content is exclusive to GAWDA Members.

A For more information on GAWDA -2.0% and association membership, contact: U.S. ELECTRICAL New orders are recovering, but remain below year-ago EQUIPMENT -7.2% A Rising input costs will squeeze margins. NEW ORDERS Stephen Hill, levels. GAWDA Membership Services Manager New orders are accelerating. in market research 954-367-7728 x 220Invest / shill@gawda.org U.S. FABRICATED

A

RECOVERY

3.8%

B

New orders are rising. Communicate competitive advantages to avoid competing solely on price this year.

1.4%

B

The Indicator rose further in April. Consider your supply chain response time in order to keep up with increasing activity.

2.5**

B

B

ACCELERATING GROWTH

C

SLOWER GROWTH

D

RECESSION

*Denotes that the current 12/12 rate of change may not be visible to the naked eye on the chart due to the scale of the data. **The ITR Leading IndicatorTM is a proprietary index comprised of consumer, industrial, financial, and global components. Movements in the Leading Indicator suggest the possible course of business cycle movements in U.S. Industrial Production 12/12, a measure of the overall economy’s activity, approximately three quarters in advance. The Leading Indicator is unitless. However, because it is designed to be a leading indicator to the U.S. Industrial Production 12/12, the monthly reading of the Leading Indicator is included under the “Current Growth Rate (12/12)” column but does not include a percentage sign.

Summer 2017 • 53


THE GAWDA INDUSTRY ANALYSIS REPORT Provided by ITR Economics™

U.S. FABRICATED METALS NEW ORDERS OVERVIEW U.S. fabricated metals new orders will rise through mid-2019 as the U.S. economy expands. - As activity increases, ensure quality control keeps pace with increasing volume to maintain customer loyalty. - Know what your customers value. This will help you get the most bang for your advertising buck. ■■

Year-over-Year Growth Rate

12-Month Moving Total 12-MONTH MOVING TOTAL

YEAR-OVER-YEAR GROWTH RATE

30

30

This content is exclusive to GAWDA Members.

500

500

20

400

For more information on GAWDA and association membership, contact: Stephen Hill, GAWDA Membership Services Manager 954-367-7728 x 220 / shill@gawda.org

300

300

200

100

0

20

400

'06

'07

'08

'09

'10

'11

'12

'13

'14

'15

'16

'17

'18

'19

10

10

0

0

200

-10

-10

100

-20

-20

0

-30

'06

'07

'08

'09

'10

'11

'12

'13

'14

'15

'16

'17

'18

'19

-30

ITR ECONOMICS FOR GAWDA | Q2 REPORT 2017 | WELDING & GASES TODAY ITR ECONOMICS | P: 603-796-2500 | www.itreconomics.com

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866.928.2657 WorthingtonIndustries.com/IGAS


THE GAWDA INDUSTRY ANALYSIS REPORT Provided by ITR Economics™

ROTATING INDUSTRY OVERVIEW U.S. FOOD PRODUCTION ■■ U.S. Food Production will generally rise through the next two years. - Rising Food Production will increase demand for industrial machinery. Look to gain market share in the food production industry as this component of industrial production expands. - Identify and remove unprofitable segments of your business in preparation for slower growth during the coming year. 12-MONTH MOVING TOTAL 12-Month Moving Average

YEAR-OVER-YEAR GROWTH RATE Year-over-Year Growth Rate

120

120

100

10

8

8

6

6

4

4

2

2

0

0

-2

-2

-4

-4

-6

-6

-8

-8

100

80

60

10

80

'06

'07

'08

'09

'10

'11

'12

'13

'14

'15

'16

'17

60

-10

'07

'08

'09

'10

'11

'12

'13

'14

'15

'16

'17

LONGER-TERM VIEW:

U.S. LEADING INDICATORS STATEMENT ■■ Rise

'06

STRONGER GROWTH This content is exclusive to2017: GAWDA Members. 2018: ONGOING GROWTH

in the majority of the leading indicators suggests rise for the U.S. industrial economy into 2018.

DECLINE For more information 2019: on GAWDA membership, contact: INDICATORSand association DIRECTION WHAT IT MEANS FOR THE U.S. ECONOMY The ITR Leading Indicator™ rose for the 15th consecutive ITR LEADING INDICATOR™ Stephen Hill, GAWDA Membership Services Manager month. The positive momentum in this Indicator is a signal that Rise (Actual) industrial production will likely rise into at least the first 954-367-7728 x 220 /U.S. shill@gawda.org quarter of 2018.

HOUSING STARTS (Most recent 12 months compared to same 12 months one year ago)

Mild Decline

CONSUMER EXPECTATIONS INDEX (Most recent 12 months compared to same 12 months one year ago)

Rise

Consumer expectations are rising. Cyclical rise in consumer confidence suggests retail sales will rise into 2018.

U.S. TOTAL INDUSTRY CAPACITY UTILIZATION RATE (Most recent month compared to same month one year ago)

Rise

The Utilization Rate's general rising trend signals that U.S. industrial production will rise into at least late 2017.

(Most recent month compared to same month one year ago)

Rise

The Indicator rose further in March, signaling upward momentum for the U.S. economy into at least late 2017.

PURCHASING MANAGERS INDEX (Most recent month compared to same month one year ago)

Tentative Decline

General rise in the Index from December 2015 through February 2017 suggests rise in U.S. industrial production into early 2018.

S&P 500 STOCK PRICES (Raw data)

Rise

Rise in the S&P 500 is a positive sign for the general economy into late 2017.

U.S. LEADING INDICATOR

56 • Summer 2017

Housing Starts will accelerate imminently, suggesting upward movement for the U.S. economy through 2017.

-10


THE GAWDA INDUSTRY ANALYSIS REPORT Provided by ITR Economics™

U.S. ECONOMIC OVERVIEW The U.S. economy, as measured by Real Gross Domestic Product (GDP), is expanding. U.S. consumers are benefiting from wage growth and low interest rates, which are contributing to GDP growth. Average U.S. manufacturing production during the 12 months through April was up 0.4 percent from the yearago level, as the consumer is keeping overall manufacturing out of recession. Employment is rising, with U.S. private sector employment averaging a record 122.8 million individuals for the 12 months through April, and wages are rising as well (up 3.4 percent). Consumers are spending money on discretionary items, such as traveling and eating out. We expect consumer strength to drive generally-accelerating growth in U.S. retail sales (deflated) during the majority of 2017 and contribute toward overall acceleration in the U.S. economy. The industrial side of the economy is recovering after low commodity prices and weak demand pushed the mining component of U.S. industrial production into recession in 2015. There are still some segments of manufacturing, such as mining and electrical equipment, that have not yet recovered entirely from recent low commodity prices. However, as the

macroeconomy accelerates in the coming quarters, we expect these segments to contribute to overall growth in manufacturing once more. U.S. wholesale trade of durable and nondurable goods are benefiting from a general rise in metal prices and oil prices, respectively. The overall industrial side of the economy is expected to expand into late 2018. The list of positive indicators that support our forecast of higher levels of U.S. industrial activity in 2017 is growing. U.S. nondefense capital goods new orders are rising. Rising U.S. small business capital expenditure plans and U.S. corporate profits signal that firms are willing and able to invest in new orders, a measure of business-to-business activity. Commodity-dependent new orders areas, such as U.S. mining machinery new orders, are generally recovering. Be prepared for growth in the U.S. economy into late 2018 with adequate capital and labor. Expect general rise in the U.S. economy through 2018 before a brief and mild 2019 macroeconomic recession. Sharpen and communicate competitive advantages in order to gain market share during the growth expected during the next two years.

This content is exclusive to GAWDA Members. For more information on GAWDA and association membership, contact: Stephen Hill, GAWDA Membership Services Manager 954-367-7728 x 220 / shill@gawda.org

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ITR FOR GAWDA ITR ECONOMICS – METHODOLOGY MOVING TOTAL/MOVING AVERAGE:

Moving totals/averages are used to smooth out the volatility inherent to monthly data at the product/company level. Monthly Moving Total (MMT) vs. Monthly Moving Average (MMA): There are times when it is desirable to calculate a monthly moving average instead of a total. Averages are used when the data cannot be compounded such as an index, percent, price level, or interest rates. Totals are used for things where it makes sense to add the data together (for example, units sold or total dollars spent).

3MMT/A:

A three-month moving total (3MMT) or average (3MMA) is the total (or average) of the monthly data for the most recent three months. Three-month moving totals (3MMT) or averages (3MMA) illustrate the seasonal changes inherent to the data series. 

12MMT/A:

A 12-month moving total (12MMT) or average (12MMA) is the total (or average) of the monthly data for the past 12 months. The 12MMT(A) removes the seasonal variation in order to derive the underlying cyclical trend. It is also referred to as the annual total or average.

RATE-OF-CHANGE:

A rate-of-change figure is the ratio comparing a data series during a specified time period to the same period one year ago. Rates-of-change are expressed in terms of the annual percent change in an MMT or MMA. Rates-of-change reveal whether activity levels are getting progressively better or worse compared to last year. Consecutive rate-of-change illustrates and measures cyclical change and trends. ITR Economics’ three commonly used rates-of-change are the 1/12, 3/12, and 12/12, which represent the yearover-year percent change of a single month, 3MMT(A), and 12MMT(A), respectively. A rate-of-change above zero indicates a rise in the data relative to one year prior, while a rate-of-change below zero indicates decline.

This content is exclusive to GAWDA Members. For more information on GAWDA BUSINESS CYCLE POSITIONS: and association membership, contact: The data trends and rates-of-change identify positions in the business cycle. Those positions are: Stephen Hill, GAWDA Membership Services Manager 954-367-7728 x 220 / shill@gawda.org

A

B

C

D

RECOVERY

ACCELERATING GROWTH

SLOWER GROWTH

RECESSION

12/12 is rising below zero and the data trend is either heading toward a low or is in the early stages of recovery.

12/12 is rising above zero, data trend is accelerating in its ascent, and growth is occurring above year-ago levels.

12/12 is below zero and the data trend is at levels below the year-earlier level.

This is the first positive phase of the business cycle.

This is the second positive phase of the business cycle.

12/12 is declining but remains above zero, data trend is decelerating in its ascent or has stopped its rise, but it is still above last year.

This is the final phase and second negative phase of the business cycle.

This is the first negative phase of the business cycle.

ITR ECONOMICS FOR GAWDA | Q2 REPORT 2017 | WELDING & GASES TODAY ITR ECONOMICS | P: 603-796-2500 | www.itreconomics.com

Summer 2017 • 59


CONSULTANTS FDA & MEDICAL GASES

Industry Must Maintain Hard-Won Reputation in Medical Gases by thomas l. badstubner

E GAWDA’s FDA and Medical Gases Consultant Thomas L. Badstubner is president of AsteRisk LLC in Lewisville, Texas. Members can reach him at 508-883-0927 and tom@asteriskllc.com.

60 • Summer 2017

very year, well over 30 million medical gas cylinders are safely filled in several thousand locations registered with the Food and Drug Administration (FDA) in the United States. Additionally, more than 250,000 trailer loads of medical oxygen are safely transported annually. After years of diligent work between the Compressed Gas Association and Gases and Welding Distributors Association membership, our industry has earned credibility with the FDA and has shown that we are capable of providing safe and reliable prescription drug products. The FDA has reported that because of our history and diligence, our industry now is subject to fewer FDA inspections than traditional pharmaceutical companies and any observations listed as a result of those inspections are certainly less frequent and less severe than traditional pharma. This hard-earned credibility can only be sustained by continued vigilance, awareness and attention to detail by all medical gas providers at all times. A single failure or significant non-conformance issue can negatively affect the thousands of registered gas facilities, if the agency believes there is a systemic problem that impacts the industry. The well-being of our customers and the patients under their care are dependent on us to do the right things to ensure the safety of our products, and ultimately patient safety. You can maintain good performance by assuring a robust medical gas program at your company and by following the applicable Current Good Manufacturing Practices (CGMP), industry guidance and best practices. As part of your company’s medical gas compliance program, consider the following high-profile compliance issues.

TAMPER-PROOF CONNECTIONS

The requirements for tamper-proof fittings on medical cryogenic containers published in CGA SB-26 has been formally codified into the regulations by the FDA. These tamper-proof fittings, along with adequate and appropriate training of employees and customers, can save lives by ensuring the correct product is filled into the container and ultimately administered to the patient. Action steps: 1. Ensure that each of your medical gas cryogenic containers are equipped with tamper-proof fittings in accordance with CGA SB-26. 2. Ensure that your employees are adequately trained in the requirements of SB-26 and can recognize tamper-proof connections. 3. Ensure your drivers are trained to never change, modify or adapt container fittings to connect to the customer medical system. (Contact tom@asteriskllc.com for free training materials).

CALIBRATION OF MEASURING DEVICES

One of the top reasons the FDA gives for requiring a medical gas recall is: “The pressure gauges, vacuum gauges, and thermometer had surpassed the calibration expiry period, which may have resulted in overfill/underfill of oxygen cylinders.” Action steps: 1. Ensure your gauges, thermometers and scales are calibrated in accordance with your written procedures (for example, annually). 2. Develop and implement an internal system to remind when your equipment is due for calibration.


3. Ensure equipment is labeled with a sticker to identify calibration due dates. 4. Train employees to recognize out-of-calibration equipment and to report it to management.

PERSONNEL TRAINING FDA inspectors scrutinize employee training records at most inspections, so it is critical that employees are adequately trained and records of the training are meticulously maintained. Training must be adequate for each specific job function for handling, filling, labeling, storing and distributing medical gas products. Action Steps: 1. Ensure all fillers, product testers, drivers and quality assurance reviewers are current with their annual CGMP training requirement. 2. Develop and implement an internal system to remind when employee training is due. 3. Randomly select several fill logs and label records for a secondary review for conformance. Provide coaching to employees if errors or omissions are discovered. Document the coaching as training. (Asterisk can provide an independent review of quality records by scanning or faxing records to Jodie@asteriskllc.com (or fax to 508-883-3558). Asterisk will provide feedback and make suggestions for improvements.)

PROCEDURES

Current written procedures must be available to all personnel involved with medical gas production and distribution. Procedures must be adequate and thorough for each job function. Personnel must be adequately trained and must follow the procedure as written. Action steps: 1. If your company subscribes to the GAWDA Medical Gas Standard Operating Procedure (SOP) Program, ensure that your compliance manual is current and up to date. 2. Ensure your employees are adequately following the written SOP by performing “job observations.â€? This is accomplished by copying a procedure from the manual, (such as filling high-pressure cylinders) and then observing the employee as he or she performs the job steps. This is an excellent management training tool and is an opportunity to determine if changes to procedures are needed. Contact tom@asteriskllc.com if you need resources to help you comply with the FDA regulations or to provide independent assurance that what you expect to happen is actually happening. Summer 2017 • 61


CONSULTANTS DOT, SECURITY, OSHA & EPA

With DOT Audits on the Rise, Here Is What Is at Stake by michael dodd

T GAWDA DOT, Security, OSHA and EPA Consultant Michael Dodd is president of MLD Safety Associates in Poplar Bluff, Mo. Members can reach him at 573-7182887 and at MLDSafety@ hotmail.com.

he number of Department of Transportation (DOT) compliance reviews seems to be on the increase for our membership. In the past, these audits were typically initiated as a security review, and while inspectors were there they reviewed other topics such as shipping papers, driver qualification files, alcohol and substance abuse programs, hours or service records, vehicle files, and other DOT items as they wished. Now that the Safety Measurement System (SMS) is in full swing, we have members with high SMS scores being targeted for an on-site audit. This past year, most of the audits were fullblown compliance reviews. Some audits were with one inspector and lasted a few hours while others were longer — in one case, it took about two weeks and involved two inspectors. Based on what auditors found and how they felt about the company, penalties have ranged from a few hundred dollars to as high as $40,000 for one company. Most averaged between $4,000 and $6,000 per audit.

Thankfully, the GAWDA members where I did mock DOT audits and training had perfect scores and no fines were assessed.

PENALTIES ASSESSED

I am often asked by our members what kind of penalties are assessed for items. DOT has published a list of baseline amounts or ranges for frequently cited violations. Here are a just a few selected examples that apply to our industry of the many listed in a table found in 49 CFR 107 Appendix A of Subpart D (see chart below).

AVOIDING PENALTIES

How can you avoid these types of penalties? You need to make sure that your required DOT record-keeping and filing systems are in place and up to date. If you need a suggested DOT filing system, please contact me. I have a sample version that has worked great for our members. I also have an audit checklist of items that is very similar to the topics that DOT reviews while doing an audit. Just ask and I will send you a copy.

49 CFR 107 APPENDIX A OF SUBPART D Failure to register as an offeror or carrier of

Failure to provide security training when a

hazardous materials and pay the registration

security plan is required: $2,500.

fee: $1,000 plus $500 for each year not

registered.

62 • Summer 2017

Failure to develop a security plan if required, or failure to adhere to the security plan: $3,000

Failure to provide hazmat training or recurrent

to $7,500, based on type of materials.

training at least every three years (general

Failure to include a proper shipping name or

awareness, safety, function specific, or security

using an incorrect shipping name on a shipping

awareness): $450 and up for each area.

paper: $800 to $1,600.


CONSULTANTS DOT, SECURITY, OSHA & EPA Failure to include a hazard class/division number on a shipping

Failure to have current authority due to failure to renew a

paper: $1,000 to $2,000.

retester’s identification number: $2,500, plus $600 each

Using an incorrect hazard class/identification number that

additional year.

does not affect compatibility requirements: $800.

Failure to conduct a complete external and internal

Using an incorrect hazard class/identification number that

examination of a cylinder during a retest: $2,100 to $5,200.

changes the response information: $3,000 to $6,000.

Performing hydrostatic testing without confirming the accuracy

Using a shipping paper that includes additional unauthorized

of the test equipment: $2,100 to $5,200.

information (extra or incorrect words): $800.

Failure to condemn a cylinder when required (exceeding the

Failure to properly placard a vehicle containing hazardous

permanent expansion values internal or external corrosion

material:

limits, denting, bulging, etc.): $6,000 to $10,000.

Table 1 materials: $1,000 to $9,000.

Table 2 materials: $800 to $7,200.

Filling and offering a cylinder that is out of test: $4,200 to $10,400. Failure to do the settled pressure test or recordkeeping for 30 days for acetylene cylinders filled: $6,200. Failure to have a requalifier identification number: $4,000.

Failure to give immediate notification of a reportable hazardous materials incident: $3,000. Failure to check each day the pressure of a cylinder charged with acetylene that is representative of that day’s compression, after the cylinder has cooled to a settled temperature, or failure to keep a record of this test for 30 days: $6,200.

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Summer 2017 • 63


CONSULTANTS GOVERNMENT AFFAIRS & HUMAN RESOURCES

Time to Prepare for the New Electronic Logging Device Rule by richard p. schweitzer, pllc

T GAWDA’s Government Affairs and Human Resources Legal Consultant Rick Schweitzer is president of Richard P. Schweitzer, PLLC in Washington, D.C. He is also GAWDA’s general counsel. Members can reach him at 202-223-3040 and rpschweitzer@ rpslegal.com.

64 • Summer 2017

he U.S. Department of Transportation’s requirement to use Electronic Logging Devices (ELDs) for driver hours of service compliance becomes effective on Dec. 18, 2017. The rule applies to all drivers of commercial motor vehicles in interstate commerce, unless subject to an exemption. For drivers of vehicles who operate solely in intrastate commerce, states are required to adopt the federal requirements within three years of the federal rule going into effect, but may do it sooner (some states adopt the federal rules for vehicles in intrastate commerce automatically while others require a rulemaking or legislation). Check with your state department of transportation (DOT) for applicability if you have any questions.

ONE EXEMPTION

There are no exemptions for the size of the company or fleet and the rule applies to all vehicles requiring a hazmat placard. The federal rule does contain a significant exemption for drivers in short-haul distribution, however. Licensed commercial drivers who operate within a 100-mile radius of the normal work-reporting location and are relieved from duty within 12 hours from the beginning of a duty period, are not required to use an ELD. These drivers are already exempt from the log book requirements and the 30-minute break requirements of the hours of service rules. If the driver is not required to have a commercial driver’s license (CDL), then the driver may drive within a 150-mile radius and return to the work-reporting location within 12 hours without needing an ELD, log book or 30-minute break. All licensed commercial motor vehicle

drivers must still comply with the daily and weekly limits on driving time and on-duty time, though. Under the new rule, if a short-haul driver exceeds the daily mileage or 12-hour limits, then the driver must complete a paper log book for that day. A driver may use this paper log exception up to eight times in any rolling 30-day period before the ELD requirement kicks in. If the driver exceeds the mileage or hours limit for a ninth time within a 30-day period, then the driver must use an ELD to record hours for that day and for each day until the driver is back within the eight-days-within-30-days limit.

CHOOSE A DEVICE

Companies subject to the ELD rule must evaluate and select ELDs, and ensure they are installed and drivers and administrative staff are trained to use them by the Dec. 18, 2017 deadline. If your company is already voluntarily using a device that meets the DOT standards for an Automatic On-Board Recording Device under 49 CFR 395.15, then you have an additional two years – to Dec. 18, 2019 – to comply with the ELD rules. Since the 1980s, motor carriers have been able to voluntarily use some form of electronic technology to record drivers’ hours instead of using paper log books. This was done first by waiver and then allowed by regulation. The devices are referred to as Automatic On-Board Recording Devices (AOBRD). But the technical standards are slightly different than the ones adopted for ELDs, so DOT gave the AOBRD users another two years to comply with the ELD requirements.


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Drivers must understand and be able to use ELDs by the required deadline, including how to annotate and edit Record of Duty Status (RODS), certify RODS, and collect required supporting documents. Drivers and companies will also need to know how to display and transfer data to safety officials when requested.

ACCEPTABLE DEVICES LISTED

Companies may only use ELDs that are listed on the Federal Motor Carrier Safety Administration (FMCSA) website (at: https://3pdp.fmcsa.dot.gov/ELD/ ELDList.aspx) as meeting the regulatory requirements. The vendors on this list have self-certified that their device is compliant with all of the ELD technical specifications, and registered each ELD model with FMCSA. In addition, although many ELDs may be part of a Fleet Management System (FMS) or include FMS functions, there is no requirement for Fleet Management functionality. An ELD that complies with FMCSA requirements is all that is required by the ELD rule. Companies that have already adopted ELD technology for hours of service compliance have found a number of benefits, including fewer entry mistakes and “form and manner errors,” better management of driver scheduling and fatigue, accurate record location and information to easily track duty status and less time on paperwork to complete driver logs.

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Summer 2017 • 65


MEMBER PROFILE

INDUSTRIAL SOURCE

A Powerhouse in the Pacific Northwest by agnes h. baker

F

ounded more than seven decades ago, Industrial Source has grown into a powerhouse in the Pacific Northwest. With seven locations ranging from Portland to Medford, this independent gases and welding distributor has the I-5 corridor of Oregon covered from North to South. Family owned since 1945, Industrial Source got its start when Ernie Laing and his partner Sterling McReynolds launched Eugene Welders Supply in Eugene, Ore. Jerry Laing, Ernie’s son, purchased Sterling’s shares in the early 1980s. The company changed its name to Industrial Source to better reflect its expansion across Oregon. Today, a third generation of Laings leads the company with Bob Laing and Brent Laing at the helm. Eugene remains company headquarters and, with a fleet of about 70 vehicles and a cylinder inventory near 30,000, it is a leading West Coast distributor.

BUILDING MARKETS

The Laings got their start serving the timber industry, which had a strong market presence in Oregon. A combination of factors led to the demise of this industry in their state and Bob Laing describes a time in the early 1980s when the region lost about 80 mills. He says, “We still support the timber industry but it’s a much smaller portion of our business today.” 66 • Summer 2017

Above: Industrial Source headquarters is in Eugene, Ore. Photo courtesy of Industrial Source.

As timber moved out, the motor coach industry moved in and Industrial Source welcomed a new market opportunity. “In its prime, several coach manufacturers were producing 50-70 motor homes a week,” says Brent Laing. “These motorhomes were built from the ground up and that required a lot of gases and welding equipment, making it a good business for us. Motor home manufacturing businesses began leaving our area in the early 2000s, taking with them several million in annual sales.” Stepping a bit outside the traditional gases and welding market, the Laing family purchased National Fire Fighter Corp., a fire suppression supply company, in 1992. That business was known to the Laings. When it came up for sale, they saw an opportunity to expand into

“The direction of growth is in our gas business [including] … a wide range of customers, but primarily fabricators. There is a lot of boat building in southern Oregon and stainless steel tank manufacturing has grown up around the emerging craft brewery business.” — Brent Laing Vice President a new market that included fire extinguishers, suppression equipment, fire alarm systems, and forestry fire-fighting equipment. The fire-fighting piece became a good niche business. Brent explains, “the wild land firefighting market is


MEMBER PROFILE growing and products are hard to find. With the advent of the Internet, lots of people found that portion of our business online and it took off.” However, like wildfires, that business is seasonal. To offset this, the company launched Industrial Headquarters in 2015, a new online endeavor that supports the yearround utility industry with safety and fire retardant clothing and gear.

GEOGRAPHIC EXPANSION In the 1960s, Industrial Source added a branch in Coos Bay, which gave the company access to a coastal location. Further geographic expansion occurred in the late 1990s and 2000s with the addition of five locations. This was a period of intense change in the industrial gas space, with some majors selling off their distributorships and others moving more aggressively into their territory. Industrial Source kept a close eye on the market and made moves that would ensure it remained competitive as an independent. “Each expansion has its own story,” Bob says. “We moved into Salem after another independent gas distributor was purchased by Praxair and we saw the opportunity to push north. The addition of our facility in Medford was prompted by Air Liquide selling off its distributorship and we won the bid. A small independent distributor came up for sale in Grants Pass and that was an attractive geography for us. “We started moving into Portland in 2000 with the purchase of Carbon Dioxide, Inc. a company similar to National Fire Fighter. In 2006, as more independent welding distributors sold to the majors in that area, we decided to expand our Portland business and added welding and gases to our existing fire business. Today, this is one of our busiest locations.” Roseburg was the last major market to fill on the I-5 corridor. In 2006,

Industrial Source built a new location there from scratch. The company’s next expansion is closer to home, right in West Eugene. Its existing headquarters operations are squeezed for space, so Industrial Source is building a new 40,000 square-foot facility, complete with the most up-to-date automated cylinder filling technology available.

Above: The company has I-5 covered, north to south, throughout Oregon.

Below: Pam Albert, Industrial Source’s lab manager/quality manager. Photo courtesy of Industrial Source.

ADDING A DIVISION The Eugene–Springfield area is a growing technology hub known as the Silicon Shire. Industrial Source’s region also includes the University of Oregon, which is adding a major new science wing. Recognizing the expanding demand for specialty gases in these markets, as well as the need to support its growing medical gases business, Industrial Source began developing Cryo Source, its specialty gas division. Michelle Willett, people and operations manager at Industrial Source, explains, “our specialty gas lab has been up and running for three years now and we are a Purity Plus provider. Cryo Source is fortunate to have Pam Albert on board as our lab manager/quality manager. She’s well known in the Pacific Northwest for Summer 2017 • 67


MEMBER PROFILE

Industrial Source is led by an 14-member management team, 13 of whom are pictured.

her knowledge and ability to meet a wide range of spec gas purity levels.” Michelle adds, “Having Pam join our team gave us instant integrity in the market. Recently, Pam successfully led us through the process of receiving our ISO 17025 accreditation. She is a key player in our future plans for this market.” Industrial Sources’ specialty gas business has been growing at a rate of 20-30 percent a year. The demand for spec gases in this region is not concentrated in any one sector but comes from a mix of businesses including research labs, laser cutting, food testing labs and food production and medical markets. Bob sees being an independent as an asset in this business. “Cryo Source is able to provide rapid turn-around time and exceptional product quality. Our customers can talk to Pam, a respected industry veteran who knows the territory, if they have questions or special requests,” he explains.

LEADING THE MISSION Industrial Source is a relationship-based company that strives to deliver exceptional customer service and value in compressed gases and cryogenics, welding, and fire suppression supplies and services. Its vision is to be the most respected and trusted provider in the markets it serves. A privately held company, and one 68 • Summer 2017

Proportionately, Industrial Source has a large cylinder business, which represents 85 percent of its total gas business. L to R in photo: Erik Gehrke, Alexander Jenkinson, John Pierson. Photo courtesy of Industrial Source.

in which every employee is given the opportunity to benefit from its success through its profit-sharing plan, Industrial Source has grown from eight employees to 105. Leading this group is an 14-member management team, which is expected to operate with integrity, positive energy, transparency and humility — with everyone they come in contact with, from co-workers to customers. The company’s most recent focus is working on The Perfect Order, a general supply chain metric utilized in the procurement world. Another GAWDA member, Bob Ewing, president of Red Ball Oxygen, has had success with this metric and traveled to Oregon to share his experience with Industrial Source. Michelle says it is because of Ewing’s

energy and enthusiasm for what they’ve accomplished at Red Ball that Industrial Source is “now emphasizing this to get to the same high-level of customer service.” One of the things Industrial Source is most proud of is its dedication to giving back to the communities that help sustain its business. Ten percent of the company’s net income is directed into local communities through cash/merchandise donations and paid employee volunteer hours. Each employee is encouraged to volunteer at least 16 hours of time, each year, during the work day, and they are paid to do so.

THE BUSINESS MIX Currently, welding and gases account for 75 percent of Industrial Source’s revenue stream and its wild land fire protection


MEMBER PROFILE business, which is largely hardgoods, makes up 25 percent. Though the company began as primarily a hardgoods shop with an 85 percent to 15 percent ratio of hardgoods to gas, last year that ratio was 55 percent hardgoods and 45 percent gas. The company experienced a slight decline in hardgoods sales last year and had a slow start to 2017 due to poor weather, according to Bob Laing. “Since then welding products are up a bit. Our foot traffic has changed over time with big box stores grabbing a lot of our home users and rural customers. But we still have walk-in traffic and we work with local schools to get young people involved in welding and fabrication.” The company has repair facilities, which are a great customer draw, with technicians doubling as customer educators. Industrial Source’s equipment

rental business is relatively small and project driven, but provides a competitive advantage. When there is a big steel structure going up, they are ready with rentals. The company also participates in online selling through its Industrial Headquarters division.

GROWTH IN GAS “The direction of growth is in our gas business,” says Brent. “This includes providing gases to a wide range of customers, but primarily fabricators. For example, there is a lot of boat building in southern Oregon and stainless steel tank manufacturing has grown up around the emerging craft brewery business. We also do business with wood products mills, wineries, hospitals and home care companies, laser users, research labs, and some construction businesses.”

Cannabis is an emerging market and Industrial Source offers its own exclusive line of extraction grade CO2 which is graded and drier for better extraction performance. Customers must be certified growers or producers in the state of Oregon to work with Industrial Source. According to Brent, the extraction side of the cannabis business uses lots of gases. They sell butane, propane, and several other gases to this industry, including liquid nitrogen and carbon dioxide.

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MEMBER PROFILE THE GAWDA RESOURCE Industrial Source is a longtime GAWDA member and utilizes many of its resources to keep its business on track. Michelle says the company takes advantage of the free online GAWDA University employee training program because, “as a relatively small business, this program gives us professional training options comparable to those of the majors.” Where safety is concerned, Industrial Source finds GAWDA’s online safety organizer very helpful and takes advantage of accessing the Compressed Gas Association (CGA) pamphlets through GAWDA’s CGA Subscription Program, as well. Lance Leister, Industrial Source’s Safety Manager, serves on the GAWDA Safety Committee. Pam Albert reports that GAWDA is vital to the company’s medical program,

“as it provides us with the completed manual, updates, and training program. We utilize their consultants for compliance and technical questions whenever necessary.”

EMPLOYEES DEFINE CULTURE Industrial Source is continually moving to meet the changing and growing needs of its customers and markets. Utilizing the latest technologies (including two from GAWDA supplier members, DataOnline LLC, for telemetry to monitor tanks and Computers Unlimited’s Advanced Cylinder Management program), the company keeps its operations efficient, according to Brent. With the completion of its new facility in West Eugene, Industrial Source and its customers will enjoy the benefits of fully automated cylinder filling. When asked to sum up what makes the company successful, however, it is

not new buildings or technologies that are at the top of the team’s list. Bob, Brent, and Michelle view the company’s success this way: “Our employees define our culture and they are what make us both unique and successful. We have many employees who have been with us 25 years, even more at 10-plus years, and one employee who has worked for Industrial Source for over 40 years. Our owners are very active in the sales and operations of the business, and their example of operating with integrity, transparency, and friendly service pays forward to our customers through our employees. That’s powerful stuff.” Agnes H. Baker is a freelance writer with more than 15 years of experience covering the industrial, medical and specialty gas industry. She can be reached at agnes.h.baker@gmail.com.

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P

hoenix International, home of the original DryRod®, is the leading manufacturer of high quality, welding electrode ovens. History: Phoenix International’s ovens are made in the heart of Milwaukee, Wisc., and have been for generations. And the dedicated Phoenix employees take great pride in each oven that leaves our facility. Quality: One of the most durable and recognized ovens in the market, Phoenix DryRod ovens have replaceable parts to keep them working for decades. Phoenix tests 100 percent of the ovens to guarantee the end user’s satisfaction. And the company stands behind its warranty with outstanding customer service and support.

Portable: Phoenix International offers a wide range of portable ovens, from 5, 10, 20, 50 and 150 pounds. Many are available with or without adjustable digital thermostats to assist the end user with the various needs for all varieties of electrodes and applications. Variety: Phoenix also offers multiple bench-style ovens ranging from 150- to 1100-pound capacity. The bench ovens can be ordered in a stackable version to take advantage of small areas as well as with or without thermometers. Phoenix

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Summer 2017 • 71


er b m e M A D W GA g n i t ra b e l e C

TH

EY E ARS KEEP ROLL ING

AL GAWDA Members Mark Major ON Anniversaries, Including Four Turning 70 G BY CHARLES MCCHESNEY

C

oming near the middle of a tumultuous century, 1947 doesn’t stand out as a momentous year. And yet, of GAWDA members marking major anniversaries this year, that is the year many were founded.

Sure, a statistical scientist could explain it away, but the question still lingers: What’s was so special about 1947 that so many companies begun then made it to their 70th anniversary? By 1947, the country’s increasing prosperity was putting to rest fears that World War II’s end would bring the return of the Great Depression. Instead, the country was gaining confidence, according to Benjamin Waterhouse, a professor of history at the

72 • Summer 2017

University of North Carolina and the author of the just published, “The Land of Enterprise: A Business History of the United States.” In 1947, he adds, “America was “primed for historic growth.” That also was the year Congress passed the TaftHartley Act, the still-standing law that set the rules for how labor and management would interact in America. The act banned wildcat and jurisdictional strikes, created right-to-work regulations that are still intact, and left labor with a seat at the table, says Waterhouse. And 1947 proved to be a good year for GAWDA members founded then who maintained and grew all the way into the 21st Century. Here, some of those GAWDA members share what has helped them reach milestone anniversaries from five years to 275 years in 2017.


CELEBRATING MEMBER

275

TAYLORWHARTON

No company on these pages has more candles on its cake than TaylorWharton. The company, founded in 1742, is marking its 275th anniversary this year, making it 34 years older than the United States. (George Washington was a boy of 10 when Taylor-Wharton began.) Recent years have brought lots of change, says Luke Bradshaw, vice president of business development and marketing. “We are extremely excited about our current position in the market. By maintaining key executives and strategic team members while also adding new ownership and increased investment, we have been able to regain a strong foothold in the market,” he says. Bradshaw sees adapting to meet customer needs as the reason TaylorWharton is around for a 275th. “Our

FEIN POWER TOOLS

Fein Power Tools Inc., dates back to 1867 when Emil Fein founded the company in Stuttgart, Germany. In 1895, the company created the first hand-held electric drill, Fein says. Metal and Products Manager Joshua Chiprich says the company has lasted so long by continuing to be innovative and demanding a level of quality that “ensures only products completely meeting our own high expectations leave our facilities in Europe, Asia and North America with the name ‘Fein’ on them.” He says the future for the power tool maker is bright. “We are on the cusp of change as a company with a lot of new and exciting products coming out over the next few years. We will be a leader in the metal working power tool industry.”

roots have always been in metal fabrication, commencing with carbon steel horse shoes, nails, and even cannonballs during the Revolutionary War. Over time, we transitioned into engineered products including manganese railroad tracks, artillery shells, high pressure gas cylinders and later, cryogenics through our acquisition of Union Carbide’s and Linde’s manufacturing facilities.” The company plans to expand product offerings and is focused on a larger U.S. presence. “Our high-level strategy involves continued growth in market share by capitalizing on both our increased investments and improved distribution, as well as expansions into complementary Top: Materials from Taylor-Wharton in the 1940s show off the company’s product lines and products and interest in quality control. Bottom: A long time ago, Taylor-Wharton acquisitions,” was in the business of making cannonballs. Photos courtesy of Taylor-Wharton. Bradshaw says.

150 Top Right: A print of Fein Power Tools factory in Germany in the 19th century. Illustration courtesy of Fein Power Tools. Bottom Right: Today, Fein Power Tools has more modern facilities on three continents. Photo courtesy of Fein Power Tools. Summer 2017 • 73


CELEBRATING MEMBER

OSBORN

When things began back in 1887 in Cleveland, Ohio, Osborn made horse brushes, brushes to clean butcher blocks and brushes to sweep streets. Today the company makes industrial brushes and grinding and flap wheels. For decades, Osborn was led by Franklin Smith, a young man who bought the majority of the company in 1895, according to Osborn’s Brian Keiser, director of operations and engineering. Smith was active with the firm until his death in 1968. Over the years, Osborn has been involved in making cotton mops, dusters and liquid polish as well as foundry

130

PHOENIX INTERNATIONAL

125

Phoenix International is best known for its Dryrod ovens, equipment designed to keep welding rods moisture-free. The Milwaukee-based

equipment and, during World War I, rifle-cleaning brushes, Keiser relates. The company has had international operations since the 1890s and has facilities in more than a dozen countries. Its U.S. headquarters are in Richmond, Ind. Since 1985, Osborn has been part of Jason, a Milwaukee, Wisc.-headquartered company involved in seating, automobile acoustics, components and finishing.

company is marking its 125th anniversary in 2017. Its ovens are made to be repairable, says Dick Wilkinson, managing director. Even the newest models are made so they can be repaired, he says. “We get pictures of our ovens that have been used since the ‘60s,” Wilkinson adds. The company was founded by George Wordingham, who had a business in

Top: Osborn was founded and grew in Cleveland, Ohio, where this factory once stood. Photo courtesy of Osborn. Left: Franklin Smith was a young man when he purchased the majority of the company in 1895. He remained active in the company until his death in 1968. Photo courtesy of Osborn.

England that was destroyed by fire. Rather than rebuild there, he headed for New Zealand, but on the way there, stopped in Milwaukee to visit family. He revised his plans, deciding that Milwaukee was the place for his business to rise from the ashes, like the legendary bird. Today, the company is led by the fourth generation of the founding family and the president shares the founder’s name (George Wordingham). As part of its anniversary, Phoenix has introduced a new company logo featuring three circles, representing three perfect weld beads. Left: Phoenix International’s electrode ovens on display at a trade show. Photo courtesy of Phoenix International. Right: As part of its 125th anniversary celebration, Phoenix International has introduced a new logo, on display at the Contact Booth Program during this year’s GAWDA Spring Management Conference. Photos courtesy of Phoenix International.

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CELEBRATING MEMBER

AIRWELD

“We’ve done everything we could to stay independent,” says Tom Biederman, vice president of Airweld in Farmingdale, N.Y., on Long Island. The company has managed it so well, it is marking its 100th anniversary this year. The firm can trace its beginnings to Perfection Storage Battery in 1917. As the company grew, it served both the welding and automotive industries under names that included Prestolite, F & G Welding, Barto Welding, Arrow Welding, Fabro Industries and Rayno Distributors. Brought together by mergers and acquisitions, the combined business took the Airweld name in 1978. The company has continued to acquire other businesses since. Biederman has been with the company for 39 years and says Airweld’s longevity has come from being a leader in the market, and that has come by staying up with changes. Airweld has five filling locations and smaller pickup stores to make it easier to supply customers throughout the New York metropolitan area. Over the years, the company has kept up with changing technology for delivering products and expanded its products to meet demand. In recent years, that has meant adding a specialty gas lab and producing its own helium. In addition, Biederman says safety has evolved to be a top concern at Airweld. Nowadays everyone understands that safety is key, he says. Biederman sees a bright future for the 80-employee company as it continues to serve New York City and the nearby area. “We’re open to anything and are always looking at acquisitions,” he says.

HOBART BROTHERS

Hobart Brothers marked its 100 anniversary with a gathering of more than 500 employees, retirees and others at its Troy, Ohio, headquarters in mid-May. Today, the company is focused on welding wires and electrodes. “The future is built on very targeted markets where we can bring value and improvement to customers who are building the world,” states David Knoll, the company’s vice president and general manager. The company, a wholly-owned subsidiary of Illinois Tool Works (ITW), can trace its history to early arc welding development and to welder-generators used in the field during World War II, says Knoll. Through its history, the company has adapted to market demands — at one point even building all-steel houses in Troy. Hobart filler metals have been used on some high-profile

76 • Summer 2017

Below: Airweld can trace its roots back to Perfection Storage Battery in 1917. Photo courtesy of Airweld. Center: Airweld has adapted to different means to deliver products on the often-challenging streets in the New York Metropolitan area. Photo courtesy of Airweld.

th

David Knoll at the company’s 100th year celebration.

projects over the years, including the Sears Tower, Toronto’s CN Tower, Green Bay’s Lambeau Field and the new Minnesota Vikings’ stadium, Knoll recounts. “It’s been an innovative company throughout its history,” he says. Today, the company is focused on welding

wires and stick electrodes. “Our future will be built with a continued focus on markets where we bring high integrity welds and improved productivity to customers building products and structures the world relies upon,” Knoll says.


METRO WELDING SUPPLY CORPORATION

Howard Stoneback founded Metro Welding Supply in Detroit, Mich., 80 years ago, his grandson J.P. Stoneback notes. Today, with more than 70 employees and a branch in Ypsilanti, Mich., the company continues to try new things. “We’ve been open to new ideas, but held to our core values,” Stoneback says. Metro Welding stocks more than 40 major brands of welding, industrial, and safety products for fabricating shops. In 1997, the company expanded its filling plant to include specialty gas production and an analytical laboratory. In 1999, the company expanded its propane and propylene pumping facilities. In 2010, the firm expanded its laboratory. “In the past three years, we’ve added beverage gas, expanded our filling facilities to instrument-grade propane, butane and isobutane as well as dry ice at our Ypsilanti facility,” J.P. says.

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Top: Metro Welding Supply Corporation’s founder, Howard Stoneback, left, with his son, Neal Stoneback in this picture from the 1960s. Photo courtesy of Metro Welding Supply Corporation. Bottom: Howard Stoneback’s grandsons run Metro Welding Supply today. On a recent fishing trip with their father, they are, from left, Greg Stoneback, Gary Stoneback and J.P. Stoneback. Their father, Neal Stoneback, is at right. Photo courtesy of Metro Welding Supply Corporation. Summer 2017 • 77


CELEBRATING MEMBER

LUCAS-MILHAUPT

Lucas-Milhaupt, Inc. has made it seven and half decades by keeping up with changes affecting its end users, says Gary DeVries, global marketing manager for the Cudahy, Wisc., company. The firm is focused on filler metals and other materials used in brazing, and that has meant developing new fillers as advances have required different materials to be joined by brazing. While brazing was once about joining two metals, high-technology users now braze to join metals to ceramics, requiring new formulas, notes DeVries. Lucas-Milhaupt supplies markets around the world from plants located in the United States, Canada, Poland, China and France. In recent years, the company has achieved growth through a combination of organic growth, new products and acquisitions. A division

CENTRAL MCGOWAN

Joe Francis, president and CEO of Central McGowan in Saint Cloud, Minn., doesn’t pause a moment when asked about the key to his company’s reaching its 70th anniversary. “It’s the employees,” he says. The company has some 90 employees, including some who have been with Central McGowan since the 1980s. With an experienced work force, Francis says the company has been able to build a modern operation, expanding from traditional lines – not just selling and servicing, but also building machines for automation. Today, about a sixth of Central McGowan’s workers are involved in the automation end of the business. Francis sees things continuing to improve for the company as it builds out distribution from its current three facilities and as automation continues to bring in more business. 78 • Summer 2017

75 of publicly traded Handy & Harman LTD, Lucas-Milhaupt, with about 500 employees, sees a continuing strong need for its products. “We see a bright future,” DeVries adds. Top: Trainees gather for a lesson in this photo from Lucas-Milhaupt, Inc.’s archives from around the 1970s. Photo courtesy of Lucas-Milhaupt. Right: Trainees learn about brazing during a recent Lucas-Milhaupt training session. Photo courtesy of Lucas-Milhaupt.

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Top Right: Central McGowan has been in the welding and gases business since the 1940s and has recently expanded into robotics manufacturing. Bottom Right: Central McGowan CEO Joe Francis shows the 70-yearold company’s mission and vision statements.


CELEBRATING MEMBER

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INDUSTRIAL WELDING SUPPLY, INC.

J i m C u s i c k ’s f a t h e r s t a r t e d Industrial Welding Supply in 1947. Today Cusick mostly works from home while his son, Scott Cusick, handles operations at the Sayreville, N.J.headquartered company. Jim began at Industrial Welding Supply when he was 17. He says the company is still guided by the principles that his father held important: “Treat the customers like family.” Scott Cusick believes part of the company’s longevity is due to its ability to keep employees, an ability that springs from that “treat them like family” philosophy. Both father and son are optimistic about the future for the company and its 26 employees. Jim sees a lot of construction work driving demand for gases and welding supplies. In his area, that’s everything from highways to power plants. “This should be one of our busiest years,” says Scott, noting that because the company runs lean, it could be a very good year.

Industrial Welding Supply, Inc., in Sayreville, N.J., marks its 70th anniversary this year. Photo courtesy of Industrial Welding Supply.

Summer 2017 • 79


CELEBRATING MEMBER

JACKSON WELDING & GAS PRODUCTS

Like many GAWDA members, Robert Jackson credits service for helping his family-owned company reach its 70th anniversary. But he quickly adds that sacrifice has been important as well for Jackson Welding & Gas Products. “There has to be some level of sacrifice to create an opportunity for a business to continue under the same family,” Jackson says of the Rochester, N.Y., business. “I know my father and grandmother made all kinds of plans and did

NORTHERN GASES & SUPPLIES Want to know the real key to having a company last 70 years? “Just keep at it,” says Steven Trump, president of Northern Gases and Supplies, in Pierceton, Ind. Though he’s been working there since he was 10, Steven is not the most senior employee. His mother, E. Marie Trump, still comes to work every day, taking the walk to work from her home next door. Northern Gases & Supplies has updated plants and equipment over the years,

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all the right things to make sure the company could move forward without massive complications that could easily derail the whole thing.” “For any owner of a company, a huge percentage of our personal value is tied up in these businesses,” he says. The question is always there: “Am I going to cash in or create the right environment for the assets to transfer from generation to generation?”

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Steven says, and the market has changed. While many welding shops have closed up over the decades, the region has turned into a center for the orthopedic industry. That has brought manufacturers as well as small companies that supply them. Steven says gases are fundamental to creating the high-tech orthopedics that are allowing

In the two generations before him, instead of selling the business, Jackson’s grandmother and father grew it and invested time and effort in providing structure and guidance as he was growing up, recalls Jackson. He was told; “Without customers, we don’t have much to do.” To help the company grow and perpetuate into the next generation, Jackson Welding has formalized its processes and its five-, 10- and 20-year plans. The upcoming generation, the oldest of whom has turned 15 years old, isn’t involved yet, but, Jackson says, “they’ve expressed interest.” surgeons to replace everything from hips and shoulders to elbows. To adopt to changes in the way things are welded — more and more by automation — Northern Gases has moved deeper into bulk gas, buying and installing equipment for customers, he adds. While it has been keeping up with changes, Steven says the company is not interested in growth at any cost. It sold off its third and most distant branch to stay focused on the market it has in Pierceton and Warsaw, Ind.

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CK WORLDWIDE

Back in 1967, what is today CK Worldwide was Conley & Kleppen. “We saw the way torches were being made and thought to ourselves, we can do this better,” says Art Kleppen, owner and founder of the Auburn, Wash., company. CK is marking its 50th anniversary in 2017 by making a $50,000 donation to the American Welding Society Foundation. Matched dollar for dollar, the donation will create two annual TIG welding schol-

arships. These $2,500 scholarships will be awarded to two individual students, every year. “CK Worldwide hopes that these scholarships open new doors for students and allows for continued growth within the welding community,” the company says in a statement. The company highlights its innovations on its webpage with video introductions to product changes as well as demonstrations of how they work.

50

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CK Worldwide is turning 50 this year. The company’s management team includes, from left, Jeff Sharpe, president; Aaron Walsberg, vice president of operations; Art Kleppen, owner and founder; Dave Cummins, vice president and finance director; Bonnie Sims, corporate secretary/treasurer and Mike Meyer, vice president of sales and marketing. Photo courtesy of CK Worldwide.

FLEXOVIT USA

“Since making our first grinding wheel in July 1977, Flexovit has followed a course of continuous quality improvement and manufacturing innovation,” says Pierre Hawkins, director of sales and marketing. “This year we are proudly putting the finishing touches on one of the most advanced grinding wheel plants anywhere in the world, right here in the United States.” In 1995 Flexovit was the first American grinding wheel manufacturer to achieve ISO Quality Certification, and is currently working towards the latest ISO 9001 standard, he adds.

The company manufactures abrasive grinding and cutting wheels in the United States and markets an array of coated abrasives, non-woven abrasives, carbide burs, wire brushes, and construction diamond blades. Flexovit operates four distribution centers in the United States, Canada and Mexico, offering same-day delivery to authorized distributors throughout North America.

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CELEBRATING MEMBER

“Flexovit has overcome its share of challenges, including the collapse of the manufacturing facility caused by a record snowfall in 2014,” notes Hawkins. As to the future, he conveys, “Flexovit is very confident that that the combination of continuous quality and process improvement, a focus on the customer as partner, and the diligence of our exceptional workforce will result in growth for years to come, right here in Western New York State.”

Top Right: Flexovit marks its 40th anniversary this year. Here’s how its facility appeared in the 1970s. Photo courtesy of Flexovit USA. Bottom Right: Flexovit USA’s current manufacturing facility and headquarters in Angola, N.Y. Photo courtesy of Flexovit USA.

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CELEBRATING MEMBER

NEW BRAUNFELS WELDERS SUPPLY, INC.

Richard Smith knows customer service is what has kept New Braunfels Welders Supply going for 30 years. The operations manager has been there since the start. He says customers tell him how important service is to them and to his New Braunfels, Texas, company’s success. “They will say, ‘we won’t go anywhere else because you treat us right,’” Smith adds. Technology has changed certain aspects of the business, particularly communications and equipment, he says. It has changed the way welders are taught and trained too. Training welders is something New Braunfels Welders used to do and plans to do again.

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The company also is getting ready to move to a new facility, a stone’s throw from its current site. That should be ready within six months. After that, Smith says, the company plans to add bulk gases. The expansion comes as parts of the oil and gases industry are still struggling with low prices. That hasn’t been a big hindrance to New Braunfels Welders, Smith says. While many pursue oil industry business, “we’ll take care of the people around here, the people who everybody else forgets about because they are busy chasing the oil people.”

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SYOXSA

Few businesses have seen as much change in the past few years as Syoxsa, an El Paso, Texas, distributor that is th marking its 30 anniversary in 2017. Syoxsa President German Trejo explains that the company once served Fortune 500 manufacturers operations in Juarez, Mexico, across the Rio Grande from El Paso. It was a large market with few competitors. Syoxsa had five facilities in Mexico, stretching from Chihuahua to Hermosillo to Juarez. However, in 2010, one of those competitors made an offer for Syoxsa’s Mexican assets. Not part of that offer

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was Syoxsa’s single facility in El Paso, which Trejo says ended up being a good business decision. With a single deal, Syoxsa changed from a Mexican company serving large international corporations to an American operation serving a competitive regional market for gases and welding supplies. Trejo estimates the El Paso market is about a third as large as the Juarez market. The sale of Mexican assets left Syoxsa with an outsized transportation fleet that Trejo hopes to use to expand the company regionally, staying on the U.S. side of the border. “You need to have a clear vision,” Trejo says of how Syoxsa managed such a dramatic transition. “There is more of a service market on this side. We are learning how to sell to federal and local government agencies.”

Above: Syoxsa, in El Paso, Texas, marks its 30th anniversary this year. Photo courtesy of Syoxsa.

Above: Syoxsa once included facilities in Mexico. Today the distributor is only in the United States, but includes some transportation assets from when it was larger. Photo courtesy of Syoxsa.

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WDPG/ A HORTON GROUP PARTNER

In 1987, when WDPG began offering insurance to members of the welding and gases industry, things were done a bit differently, says Kenneth Tidwell, senior vice president at the Horton Group and WDPG national marketing director. “Empty cylinders used to be rolled,” Tidwell explains, adding that sometimes cylinders were carried fireman-style off the back of trucks. Thanks to changing practices, “it’s much safer from a workers’ compensation standpoint.”  Who makes what has changed as well. While there are fewer makers of acetylene today, Tidwell says, there are many more makers of hydrogen and specialty gases. Insurance has had to keep up with those changes, and create conditions that make them possible. “Working with Royal Insurance, we created the escaped gas endorsement in 1993,” he says, noting the endorsement allowed welding supply distributors to fill a coverage gap not previously covered. Tidwell sees cyber liability as a focus in the future as well as employment practices liability coverage. “You wouldn’t drive a truck without insurance, why hire and fire people without it?” he asks.

AMERICAN CYLINDER GAS

American Cylinder Gas Vice President Kevin Heckel remembers well his father’s words and credits the company’s reaching its 25th anniversary to those insights. “He always said to treat our customers like family,” Heckel reports. That customer-centric focus has led to strong relationships for the Butler, Wisc., company. American Cylinder Gas’s six employees interface not only at the store counter or even at golf outings, they also attend their children’s graduations,

86 • Summer 2017

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Heckel explains. “We actually build relationships.” The company has been adding technology to free up more time to provide customers with service. That’s something Heckel thinks is providing a bright outlook for the business. “For a lot of customers, it’s not just about price,” he says. That’s an attitude that some thought faded when

WDPG’s first formal board meeting in 1993 included, from left, Ray Puryear, president of Southern Welding Supply, Birmingham, Ala.; Jim Robertson, president of Industrial Oxygen, Dallas, Texas; Larry Kennedy, owner, Red Ball Oxygen, Shreveport, La.; Jim Terence, Tuscaloosa, Ala.; and Ken Tidwell, program director, Nashville, Tenn.

the economy was struggling. But now, particularly among small- and medium-sized businesses, Heckel feels that is “something that is coming back.” The company has also benefited from joining a buying group and abiding by another of his father’s sayings: “Keep busy; start by learning from your mistakes.” American Cylinder Gas in Butler, Wisc., recently expanded its showroom. Photo courtesy of American Cylinder Gas.


CELEBRATING MEMBER

AMWINS

The insurance market for gases and welding supply distributors has had some ups and downs in the 25 years through which AmWINS traces its roots. Nevertheless, the program underwriter has been a constant, says Managing Director Bill McCloy. “People jump in and out the marketplace. We’ve never done that. We’ve always been there.” The company’s structure has changed across the quarter century, though. Until

25

2003, the business worked for an international insurance carrier. When that carrier abandoned the U.S. market in 2003, AmWINS changed its business plan and became an independent wholesaler representing a carrier, rather than working for the carrier. “We solved that crisis,” McCloy says. “Most of our clients came with us.”

Today, AmWINS is the largest insurance wholesale distributor in the United States, he says. The challenge for the program underwriter is the one that so many in GAWDA recognize: consolidation. With clients from the largest regional distributors to momand-pop operations with two trucks, McCloy says that some accounts disappear when the distributor is purchased by a larger company. Despite that, he says, “we’ve been able to sustain a viable program.”

CATALINA CYLINDERS

For Catalina Cylinders, in Garden Grove, Calif., 2017 marks the 25th anniversary of the purchasing of the company by Philip S. Keeler and his company, Aluminum Precision Products. In 2009, Catalina adopted an Employee Stock Ownership Plan (ESOP), and the company ownership has been gradually transitioning from the Keeler family to Catalina’s employees. David Silva, Catalina’s vice president of sales and marketing, says a cor-

Catalina Cylinders marks its 25th anniversary this year. The company recently built a 107,000 square-foot facility for composite-wrapped cylinders.

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reach unprecedented levels of quality and consistency, he says. “This has made a big difference for our specialty gas cylinders in recent years, because we can control the internal surface roughness and cleanliness of these cylinders like never before.” He expects that plant, and processes that improve the internal surface stability of cylinders, to play an important role in the company’s future. Catalina expects to see rising demand for larger, higher pressure, lighter-weight cylinders, “because these product characteristics drive efficiency and cost savings for our customers,” Silva says. That’s why the company built a new 107,000 square-foot facility dedicated to composite-wrapped cylinders.

H-TOWN OXYGEN Some GAWDA members have to check records to be sure when their business started. Not Bill Carper. He started H-Town Oxygen, in Houston, Texas, on his 30th birthday, back in 1997. With seven employees, H-Town is largely focused on the oil industry in Houston, Texas, and that work is driven by offshore drilling, Carper explains. That business dynamic has been problematic because lower oil prices and the reinvigoration of landbased oil fields have made offshore drilling much less appealing. “The oil market has just cratered here. Right now we are going through the most difficult year we’ve ever had,” he adds. The company has pushed into other

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porate culture of putting customers first has helped the company reach the quarter-century mark. That culture has contributed to having zero catastrophic failures of a cylinder due to material or workmanship and, he adds, has meant reinvesting 76 percent of profits into the business. Those investments have allowed the company to expand capabilities and adapt new automation technology, including a new composites facility to broaden the company’s capabilities, adds Silva. Automation has enabled Catalina to

“It’s going to get better. It’s just a matter of time.” -BILL CARPER, PRESIDENT H-TOWN OXYGEN COMPANY

parts of the industry looking for sales, but so has the competition. “Everyone is chasing after the few remaining customers,” he notes. But, Carper is no pessimist. “It’s going to get better. It’s just a matter of time,” he declares, noting that jobs in Houston are starting to rebound after a flat 2015 and weak 2016. The second half of 2017 is expected to see 15,000 to 20,000 oil and gas industry jobs coming back, he adds. That situation offers hope. “We do have a nice opportunity, since there are so few independents left,” Carper says.


CELEBRATING MEMBER

HIGH PLAINS GAS & SUPPLY

Co-owners Shannon Lind, S t e v e U n re i n and Gene Neugebauer, of High Plains Gas & Supply in Englewood, Colo., are agreed: Their five-year-old business survives and thrives because of the service they and the rest of their 15 employees provide. “It’s kind of a dying art form for some of our larger competitors, so we get a lot of loyalty and a lot of new customers based on our service level,” says Lind. That service includes getting orders out on a timely basis, returning phone calls and having in stock what customers want. The company has rapidly spun up capability to meet customer demand, the three explain. The firm offers bulk

5

PRIMARY GAS SOLUTIONS

Pat Ludwig started Primary Gas Solutions in Orange, Calif., with his wife, Wendy Ludwig, five years ago. Things are going pretty well, he reports. “We’re chugging along.” The company’s primary focus is on high-purity gases for use in research and in environmental laboratories, he says. “Our customers have been very loyal. I think a lot of these small businesses enjoy doing business with other small businesses.” Word of mouth has brought calls from new customers and potential customers beyond the base that also includes universities and others who need high-purity gases.

cryogenic and argon and nitrogen gases and pumps nitrogen and argon at high pressures. “Our philosophy has always been, keep it simple and do the basic things right and your company will grow,” Unrein says. While 2016 was a good year, growth was not the 20-plus percent that the co-owners anticipate for 2017. “We’re pretty excited,” he says.

“We have gotten into some businesses that do laser cutting, so they’ll use laser mixtures and liquids,” Pat adds. Now, the company is getting inquiries from other industrial customers that want to talk with Primary about becoming a supplier. Pat says that, all in all, the future is looking pretty good for the company.

Five-year-old High Plains Gas & Supply has three owners, from left, Shannon Lind, Steve Unrein and Gene Neugebauer. They project better than 20 percent growth in 2017. Photo courtesy of High Plains Gas & Supply.

Wendy and Pat Ludwig (below) started Primary Gas Solutions in Orange, Calif., five years ago.

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Summer 2017 • 89


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Networking Breakfast

8:30 am - 12:00 am

Contact Booth Program

12:30 pm

Tours and Activities

12:30 pm

Industry Hospitalities

6:00 am - 1:00 pm

Convention Registration

7:00 am - 8:00 am

Networking Breakfast

8:00 am - 12:00 pm

Closing General Business Session

12:30 pm - 4:00 pm

Women of Gases & Welding Event Broadway play, “Beautiful,” by The Carole King Musical

7:00 pm - 11:00 pm

President’s Farewell Gala


2017 Annual Convention Preview

NEW YORK, NEW YORK...IT’S A WONDERFUL TOWN For the GAWDA spring meeting, members enjoyed sunny, beachy Boca Raton. This fall, we’re heading for skyscrapers, glitzy streets and bright lights. The fall GAWDA Annual Convention takes place in New York City October 1– 4. Those four days provide ample time for GAWDA’s important business (including celebrating an outgoing president and installing 2017-2018’s new one) – while leaving space in the schedule for attendees to take in those iconic New York experiences. Here is the upcoming AC schedule and a look at two of the scheduled Business Session speakers.

Keynote Presenters ALAN BEAULIEU GAWDA Chief Economist and Principal and President | ITR Economics For Alan Beaulieu, it’s all about the numbers – and what the numbers say about the direction of the economy. He joined his brother, Brian Beaulieu, in the New Hampshirebased ITR Economics 27 years ago, and has since become one of the country’s most noted and informed economists. He’s also a speaker who is in high demand. With an economic trends accuracy forecasting rate of 94.7 percent, Alan books 90 or more conference and organizational speaking appearances each year. Since January, Alan has been presenting GAWDA Industry Analysis quarterly reports as an exclusive service to members. His reports provide trend forecasts and actionable recommendations that members can immediately use in their strategic and operating efforts. He was a favorite presenter at the Spring Management Conference, not only because of his prescient economic insights, but because of his comedic and ironic speaking style. He’s back now to update GAWDA businesses and to augment what he sees in the economy’s latest twists and turns – and to describe how those insights translate into recommendations we can use in our businesses.

DANIEL VAN DER VLIET Executive Director | Smith Family Business Center S.C. Johnson School | Cornell University Growing up in a family business and unfortunately experiencing the family conflict that sometimes results, Daniel Van Der Vliet now helps other families obtain the information and expertise they seek to help them run their businesses better. Along with that, his program provides another essential ingredient: the camaraderie and understanding a cohort group can bring. Van Der Vliet joined Cornell’s noted S.C. Johnson School of Business Management in 2014 as the first director of the Smith Family Business Initiative. He provides experience, knowledge and insights from fourteen years at the University of Vermont, where he helped build a highly-regarded family business program from the ground up. He works with Cornell Professor Wesley Sine, faculty director of the Entrepreneurship and Innovation Institute at Cornell, to organize courses, programs, events and networking occasions to benefit family businesses all over the U.S. and beyond. Van Der Vliet’s plans call for building the Initiative’s reach into a global one that connects family businesses throughout the world. Summer 2017 • 91


HQ & PROGRAM NEWS

R E C A P

SPRING MANAGEMENT CONFERENCE

92 • Summer 2017

Top: GAWDA Band members jammed to a delighted reception of fellow conference-goers in their firsttime effort. They included: Jim Appledorn, Ray Borzio, Dino D’Onofrio, Greg Hansley, Bill Brancato, Rich Braatz, Jim Atkins, Bill Visintainer, Jack McCullough, Gary Halter, David Andrew, Gary Smith. Linda Smith joined the chorus. Middle Left: Cavagna North America and Norris Cylinder members and guests enjoyed the evening.

Middle Right: A robust Prize Program helped make the Contact Booth Program one of the busiest and best-attended of recent GAWDA conferences. Bottom Left: Four Generation Next panelists presented some surprising perspectives on what they expect as young consumers and how they want to be regarded and treated by the industry. From left are: Andrew Strickland, Esmeralda Alvarado Rodriguez, Chandler Vincent and Reed Cheatham. Bottom Right: Mark Raimy and Chandler Vincent.


HQ & PROGRAM NEWS

GAWDA

BRINGS IT BIG IN BOCA! It was all big and it was all there for the taking at this year’s Spring Management Conference - the sand, the sun, the gracious Old Florida setting of the Boca Raton Resort and Club. Plus, GAWDA members and guests, with the usual spontaneaity and spunk, made the most of both business sessions and after-business hours. With a bigger and better Contact Booth Program, and one of the highest attendance figures in recent years, 2017’s GAWDA SMC was one for the record books. These photos show GAWDA members and officials enjoying all that Boca, and GAWDA, had to offer.

Top Left: Keynoter Curt Steinhorst humorously portrayed differences between the generations and detailed the distinct needs and interests of millennial employees and customers, including how they want to be approached and how they communicate. MIddle: Huber Supply and Lincoln Electric folks mingled. Top Right: An enthusiastic GAWDA President Mark Raimy cues the new GAWDA band, InA-GAWDA-Da-Vida, which performed publicly for the first time at the President’s Reception. Bottom: This group of First-Timer’s reception guests, representatives of Ignitor Leadership, Equigas and Maverick, were flanked at left by Justin Trafton of McDantim and Bob Ranc of Weldcoa. Summer 2017 • 93


HQ & PROGRAM NEWS

Top: George Ratermann gathered audience members who offered comments and questions on stage at the end of the Gen Next panel discussion. Left: Lincoln Electric chairman, president and CEO Christopher Mapes presented convincing facts about the need for welding workers in the coming years. Right: President Raimy with Workshops for Warriors officials Lyle Palm and John Jones.

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HQ & PROGRAM NEWS

S MC RECAP THE SOCIALWALL

Photos and social posts were uploaded by GAWDA members at the SMC through the new GAWDA events app. Summer 2017 • 95


HQ & PROGRAM NEWS

TAKE

Lansing, MI

Sunriver, OR

A ROAD TRIP

North Stonington, CT Atlantic City, NJ Seven Springs, PA

Gettysburg, PA

Tulsa, OK

Regional Meeting Season Continues Through September

Birmingham, Al

Houston, TX

GAWDA’s schedule of Regional Meetings is heading for the home stretch. For the latest updates on Regional Meetings visit www.gawda.org/activities/regional-meetings. N. STONINGTON, CT

AUG 14-15

Location: Lake of the Isles Golf Club and Resort Monday, August 14 • Social networking

Tuesday, August 15 • Welcome and GAWDA Update • Larry Cassesa, Abicore Binzel,

on managing welding fumes • Contact Booth Program

GETTYSBURG, PA

SEPT 6-7

Location: C  ountry Inn and Suites & The Links at Gettysburg Wednesday, Sept. 6 • Group networking dinner with music and games

Thursday, Sept. 7 • Business meeting followed by golf • Silent auction for GAWDA Gives Back featured

Contact: Doug Morton; dmorton@eleetcryogenics.com

• Golf, cocktails and dinner

Contact: Jay Kapur; JayK@aimtek.com

TULSA, OK

SEPT 11-12

Location: Hard Rock Hotel and Casino

WATCH FOR UPDATES ON THE REGIONAL MEETINGS IN THE GAWDA CONNECTION.

Monday, Sept. 11 • Registration, golf and reception at Cherokee Hills

Golf Club Tuesday, Sept. 12 • Speakers Kelly Riggs on value selling, Tim Neeser

from Chart Industries and lunch at Sequoyah 4 Hall Contact: David Hanchette; dhanchette@ceekay.com

96 • Summer 2017


he following businesses recently joined the Gases and Welding Distributors Association. For more information about the benefits and services available to members, please contact the Association at 844-251-3219 and Stephen Hill, membership services manager, or visit www. gawda.org.

T

SUPPLIER MEMBERS CENTRAL TOOLS INC.

RHINO CUTTING SYSTEMS

DISTRIBUTOR MEMBERS

Central Tools Inc. is the parent company of multiple brands of products including King Tool (formerly of Montana).

Rhino Cutting Systems is a manufacturer of custom engineered oxy and plasma cutting machines for 2D, 3D bevel and complete weld prep applications.

ALLTEX WELDING SUPPLY, INC.

EQUIGAS, INC.

2930 Washington St. Waller, Texas 77484-8268 936-931-1072 Justin Kirby, vice president

456 Wellington Ave. Cranston, R.I. 02910 401-467-8211 Bob Pond, vice president, sales and marketing

215J Industrial Ave. Greensboro, N.C. 27406 336-790-3915 Rafael Arvelo, general manager

AllTex Welding Supply provides welding supplies and industrial gases with high customer service levels to Waller, Texas, and Navasota, Texas, and surrounding areas.

EQUIGAS International, Inc. is a distributor of equipment and parts for industrial gases and medical industry that serves the United States, Latin America and the Caribbean.

ENCORE WELDING

GAS CYLINDERS DIRECT

2675 Temple Ave. Signal Hill, Calif. 90755 562-612-4757 Ben Anderson, president

Encore Welding and Industrial Supply is a full-service welding, industrial and safety supply company, offering specialty and industrial gases, quality products and an intense focus on customer satisfaction.

IRISH OXYGEN COMPANY

1430 West County Road, Suite C 100 Roseville, Minn. 55113 651-756-8399 Jason Sullivan, president

A service-disabled, veteran-owned business, Irish Oxygen Company deals primarily in medical and specialty gases, mostly for the government.

136 Carlyle Drive Palm Harbor, Fla. 34683 888-565-6179 Robert Caspar, president

Gas Cylinders Direct is a global supplier of cylinders, including empty ISO gas cylinders, oxygen cylinders, SCUBA cylinders and more.

MAGNEGAS CORPORATION

1885 44th St. N. Clearwater, Fla. 33762 727-934-3448 Eric Newell, project manager

MagneGas owns a patented process that converts various renewables and liquid wastes into MagneGas fuels. These fuels can be used as an alternative to natural gas or for metal cutting.

5316 John Lucas Drive Burlington, Ontario Canada L7L 6A6 289-245-1020 Paul Bhogal, managing director

SINGER SAFETY

2300 N. Kilbourn Ave. Chicago, Il. 60639 800-621-0089 Anna Marie Johnson, president

Singer Safety focuses on “industrial barrier protection.” Products are most often used in retrofit applications and are designed for protection from industrial hazards of heat, dust, flak, sparks, flash, molten metal and unwanted noise.

SKAFF CRYOGENICS, INC.

48 Pine Road Brentwood, N.H. 03833 603-775-0350 Steve Prefontaine, vice president

Skaff Cryogenics repairs and remanufactures cryogenic and liquefied natural gas tanks and trailers.

SUMNER MANUFACTURING 7514 Alabonson Road Houston, Texas 77088 281-999-6900 Steve White, USA sales

Sumner Manufacturing is a maker of pipe stands, material handling, material lists and pipe fit up tools.

Summer 2017 • 97


HUMAN RESOURCES

Disengaged Employees: They Can Hurt Morale, Plus Hit Your Bottom Line It’s Well Worth the Effort to Set Goals, Engage and Measure Employees by mike hill

E Mike Hill, who has more than 25 years of experience in industrial distribution, is one of America’s leading experts on employee evaluations. His proven tips for how, why and when to perform employee evaluations have been presented at conferences the world over. His new book, “Measuring to Manage: Using Measurable Data to Get Maximum Employee Performance,” joins two others he has written on using data for management practices.

ver wonder how much – or how little – your company’s employees are focused and engaged in what they do on the job? There’s a significant cost to employee disengagement. According to a 2016 Gallup survey, 68 percent of employees in the U.S. work force is disengaged from their jobs. That means almost seven out of 10 of your co-workers (or, for managers, your employees) are disengaged. How’s that for an eye-opener? What’s the cause of employee disengagement? One of the issues that prompts disengagement is if employees feel they are not being compensated fairly. Some employees cite a lack of freedom to do their jobs effectively (think micro-managing). If you’re a manager, you have to consider that you might be the problem. Author Paul Nolan reports one study showing that in the United States, 50 percent of employees have left a job at some point in their careers to get away from a manager. Still another reason for disengagement can be a lack of clearly defined goals and expectations for someone’s position.

THE COST OF DISENGAGEMENT

It’s important for business operations to identify and deal with employee disengagement because disengaged employees undermine what their engaged co-workers accomplish. That lowers overall productivity and work place morale. It also takes a toll on the bottom line. Disengaged employees are estimated to cost U.S. businesses $450 billion to $550 billion of lost productivity each year, according to information reported in Gallup – State of the Global Workplace. Gallup says a single disengaged employee can cost his or her company $3,400 for every $10,000 in annual salary. 98 • Summer 2017

What can be done about disengaged employees? I agree with consultant Scott Crabtree’s admonishment that, “You cannot buy somebody’s engagement, but you can fail to buy it.” He adds, “fair compensation is necessary but not sufficient to get employee engagement.”

According to a 2016 Gallup survey, 68 percent of U.S. employees are disengaged from their jobs. I write and speak about ways to improve employee performance through the use of employee evaluations, and I train employees how to do them in my practice. Evaluations are tools that can improve employee engagement by increasing the level of employee input and focus on their performance. Here are my recommendations for increasing employee engagement through goal setting and performance evaluations.

GOALS

Study after study has shown that challenging employees to meet goals motivates them to a higher performance level. The best way to develop goals for your employees is to have them help set their own performance goals. Ask them to come up with two or three ideas for goals. Make sure that the goals are measurable, trackable and attainable. When employees help set their own goals, it’s more likely that they will accomplish them.


HUMAN RESOURCES ALIGNMENT

It’s necessary to identify how such tasks and accomplishments align with the organization’s needs. The best way to achieve alignment is to explain how an employee’s work fits in the big picture. To accomplish that, you might show where an income-producing goal allowed the company to invest in a specific project, for example. Or you could show how achieving a goal saved money that would have had to be spent if it was not accomplished. If you can achieve alignment of employee goals with company goals, the company wins.

PROGRESS

Employee progress needs to be celebrated, and it’s crucial to acknowledge when an employee accomplishes progress measurements. These don’t have to be huge or expensive celebrations. The gesture can be as important as any reward and even a little thank you goes a long way. For instance, more than 10 years ago we gave each employee a silver dollar on payday to celebrate having a great month where I worked. To this day, when I see many of those employees, they still talk about receiving that silver dollar. It was the recognition and the gesture that was important, not the monetary value. It created a lasting impression.

EMPLOYEES’ ROLES

Creating and maintaining an engaged workforce isn’t just management’s responsibility. Employees can be encouraged and held accountable for, making engagement part of their own performance improvement initiative. You can set some

of their goals, but they also can set some of their own. When employees are truly engaged in their work, the company will experience a change in its culture. It will become a place of highly accomplished employees. Such workers will want to work alongside other highly motivated employees. Disengaged workers will not want to stay in that atmosphere. That’s actually good for your business. In my own distribution company, after we set measurable goals, most employees made the effort to meet or exceed those measurements. The employees who were disengaged complained for a while, but when they saw that the majority of the employee were embracing the standards, they realized that this was not the environment for them and they resigned. After our goals and standards were in place, we even put this language into our hiring ads. That way, potential employees knew before they applied for a position what our work culture was and how we treated our people. What’s the payoff for making this type of effort? According to Reese Haydon’s, “Show Me the Money: The ROI of Employee Engagement,” there is plenty, including: • Engaged companies grow profits as much as three times faster than their competitors. • Customer loyalty is two times higher • Employee productivity is two times higher • Expensive turnover costs are cut, and the rate is two times lower. The effort you take in assuring you have engaged employees working for you clearly is worth it, since it equals more money to your bottom line.

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BEST PRACTICES

Use Conversations to Spark Customer Engagement Making Human Connections, vs. Selling on Price, Builds Your Brand by jeremy miller

T Jeremy Miller is a brand strategist, keynote speaker and the bestselling author of Sticky Branding. He helps companies develop strategies to market their businesses and grow their brands. As a keynote speaker, his blend of humor, stories, and actionable ideas will inspire you to innovate and grow a Sticky Brand. For more information visit www. stickybranding.com.

he five best words you can hear a customer say are, “that’s interesting. Tell me more.” When you get a customer to say, “that’s interesting. Tell me more,” you’ve caught their attention. They’re listening and responding to you. They’re having a conversation. This is powerful, because a conversation is a two-way dialogue to share ideas and opinions. Every company has an opportunity to engage its customers in conversation, but few do. They’re too busy marketing and selling to slow down to have a dialogue. But in a world of endless competition, having a conversation is one of the most powerful tools in your marketing toolbox. The simple act of engaging your customers deliberately and authentically in conversation will make your brand stand out. Dr. Seuss said it best: “Why fit in when you were born to stand out?” If you want to drive sales and have a remarkable brand that your customers know, like and trust, spark conversations with them. It’s really simple. Conversations build relationships that drive sales.

CONVERSATIONS LEAD TO RELATIONSHIPS Customers are looking for ways to differentiate one option from the next. As competition increases, human connections are becoming even more valuable. When the buying options all look very similar, customers will default to one of two positions: 1. They’ll go with what they know, or 2. They’ll go with what’s cheapest. Selling on price is no way to grow your brand. Lean on the first option. Build strong relationships with your customers so they know 100 • Summer 2017

you, like you, and trust you. A conversation is one of the most human ways to form a relationship. It helps transition your brand from a stranger to a friend to a customer, and that two-way dialogue accelerates the process. It helps you get to know one another, and that makes your brand more likable.

STORYLINES SPARK CONVERSATIONS It gets pretty boring if all you talk about is yourself. The same is true for companies. Engage your customers with “brand storylines.” A brand storyline is a communication device to engage your customers in a conversation.

A STORYLINE EXAMPLE Here’s one example of how it can work. Muldoon’s Coffee argues that going out for coffee is causing a productivity epidemic. According to Shaun Muldoon, CEO of the coffee company, “six percent of an organization’s payroll is spent going out for coffee.” That’s a startling statistic. Next, Shawn details the issue, stating: “An average employee spends over 125 hours a year going out for coffee. That’s six percent of the employee’s salary, or three weeks of vacation. Professionals, especially young professionals, want a good cup of coffee. They are not going to drink the stale, vending machine stuff in their office. They’re going to get a good coffee.” Shaun is making a bold claim by stating six percent of your payroll is spent going out for coffee, but let me ask you. What do you think? Do you agree? Disagree?


BEST PRACTICES DO YOU NEED TO AGREE? NO. It doesn’t matter whether you agree or disagree with Muldoon’s premise. The point of the statistic he’s presented is to spark a conversation. Shaun’s statements are an example of a brand storyline. Muldoon’s Coffee is a corporate coffee service. Their brand storyline supports a key competitive advantage, “Muldoon’s Coffee tastes better.” According to customer surveys, Muldoon’s Coffee tastes better than Starbucks and other premium coffee brands. The problem is, taste is subjective. Instead of spending all its time doing taste tests and cuppings, Muldoon’s looked for a more universal topic of conversation. This lead them to “productivity in the workplace.” Lost productivity due to “coffee runs” strikes a nerve. It catches business owners’ and chief financial officers’ attention – and prompts them to say, “that’s interesting. Tell me more.”

These three elements function as a three-legged stool. A brand storyline is unsustainable if any one of the elements is missing. For example, strong opinions without expertise is a rant. Expertise without strong opinions is boring. And without a point of sharing, you’re talking to yourself.

ANY COMPANY CAN ENGAGE Any company of any size can engage its market with conversations. Conversations are powerful, simple, and sustainable. A great brand storyline with an empowered team can spark a fire. That engagement is so valuable for these reasons: 1. It can increase brand awareness. 2. It can generate more sales leads and referrals. 3. It can accelerate the sales cycle, because your customers know and trust your brand. Start small. Try engaging your customers deliberately with a few brand storylines, and see which ones resonate. When you find a storyline that sparks a discussion, double down on it. Look to amplify the conversation, and get more people involved. See who else will engage with your company. Conversations are so simple. It’s just people talking with people. You have the tools to get started. Go find a topic that gets people to say those five magical words, “that’s interesting. Tell me more.”

THREE ELEMENTS TO ENGAGE Brand storylines are unique tactics because they are not just conversations about the weather or sports, and they are not one-sided pitches promoting your brand. They are conversations crafted to engage your marketplace and keep your brand top of mind. They are effective marketing tools because they are crafted to connect conversations to your brand. A brand storyline has three fundamental elements: 1. Expertise: It’s a topic you and your team know well and draws from your company’s core expertise. 2. Strong Opinions: It’s a topic your company is passionate about. You can take a stance and boldly share your opinions. 3. Point of Sharing: The topic resonates with your target market and encourages others to participate in the conversation. Summer 2017 • 101


INDUSTRY NEWS Welsco Adds Store in Northeast Arkansas

has a proven track record of helping companies achieve financial and strategic goals,” says Bill Dwyre, managing director, Americas, Weiler Abrasives Group. McDonald most recently served as director of sales for the power tool division at APEX Tool Group, and comes to Weiler with more than 18 years of sales and marketing experience. Prior to his Chad McDonald time at APEX Tool Group, McDonald was the business unit director for KaVo Dental, where he led both the sales and marketing teams in the U.S. He has also held various sales and marketing roles with Danaher Tool Group and IRWIN Industrial Tools. McDonald holds a bachelor’s degree in marketing from Georgia Southern University and an MBA from Loyola University Maryland.

Welsco Chairman and CEO Angela Harrison cuts the ribbon at the opening of the company’s new facility in Jonesboro, Ark. Photo courtesy of Welsco.

IWDC Sets March Monthly Record

Welsco, Inc., of Little Rock, Ark., opened a new 6,000 square-foot store in Jonesboro, in Northeast Arkansas. The store includes three employees and is managed by Mike Crutcher, says Aaron Campbell, Welsco’s vice president of sales. He says that part of Arkansas is growing. The Jonesboro store is Welsco’s fourteenth.

Ferrare Named Vice President of Operations at Anthony Welded Products Anthony Welded Products, Inc. has appointed Gino Ferrare vice president of operations. Ferrare first joined the company in 1980. He served as general manager until 1990, when he chose to pursue an opportunity to serve as the vice president and general manager of a worldwide plumbing tool manufacturer while still serving on Gino Ferrare the board of Anthony Welded Products. In 2001, Ferrare started consulting directly for Anthony in tandem with his private interests and other business matters.

Weiler Names McDonald Vice President of Sales, U.S. and Canada Chad McDonald has been named vice president of sales, U.S. and Canada, for Weiler. He will oversee all sales activities in the U.S. and Canada, including field sales, national accounts and manufacturer’s rep groups. He will also be responsible for continuing to strengthen Weiler’s relationships with distribution partners, end users and industry associations. “We are pleased to welcome Chad McDonald to the Weiler team. He brings a wealth of experience and leadership, and 102 • Summer 2017

Independent Welding Distributors Cooperative member companies’ spend through their co-op exceeded $19 million in March, the co-op says, smashing the prior record for the month by more than $800,000. “We actually almost broke our highest monthly record set back in May of 2014,” says Frank Kasnick, IWDC president and CEO. “This is a testament to the strength and resilience of the independents in our welding and gases industry, and reflects the strong support from our vendor partners.”

SUMIG USA Moves to Larger Facility SUMIG USA moved to a larger facility in May. “Our new location gives us the necessary warehouse space to offer 99 percent same-day shipping on most items. SUMIG has also invested in a new ERP system which will give distributors the opportunity to order products utilizing their online account and track their orders in real-time,” the company says. The new address is 8600 Commodity Circle, Unit 159, Orlando, Fla., 32819. SUMIG USA is a global manufacturer of welding equipment, supplies and robotic welding cells.

Sellstrom Moves to New Address Sellstrom has moved all business activity to its new address, 300 Corporate Drive, Elgin, Ill., 60123. The company says the new 100,000 square-foot facility is


INDUSTRY NEWS about 15 minutes from its former location in Schaumburg, Ill. “Moving to a larger and automated distribution center will improve product availability and provide a higher level of customer service to our U.S. distributors and enhance our growth trajectory in the U.S.,” CEO Chris Baby says in a letter announcing the move. He adds that incoming phone and fax numbers will remain the same.

GAWDA Members Receive CGA Safety Awards Several GAWDA members received safety awards from the Compressed Gas Association (CGA) at its recent Safety Awards Banquet held in conjunction with the Association’s Annual Meeting in Coral Gables, Fla. The Fleet Safety Excellence Award for bulk gas transportation was awarded to two companies, based on miles driven and company’s total vehicle accident frequency rate. For bulk gas transportation: • Less than 20 million miles – Matheson • More than 20 million miles – Air Products and Chemicals, Inc. For cylinder gas transportation: • Less than 3 million miles – Western International Gas & Cylinders Inc. • More than 3 million miles – Matheson The Leonard Parker Pool Safety Award, given in two divisions, went to Linde North America Inc. for Group 1, more than two million employee exposure hours, and to FIBA Technologies Inc., for two million or fewer employee-exposure hours. The CGA/GAWDA Distributor Safety Award went to CRT Inc., for companies with more than 100,000 employee exposure hours, and to Spectrum Gas Products, for companies with 100,000 or fewer employee exposure hours. Joseph Leonard of Airgas SAFECOR was presented with the new committee member of the year award. The Charles H. Glasier Safety Award, presented annually to an individual in recognition of their safety leadership in the industrial gas industry. The award was presented to John Bernard of Praxair, Inc. Established in 2000, the CGA Environmental Recognition Program identifies and shares good environmental practices as well as promotes environmental awareness and improvements with companies and the industry. Awards are presented annually to a CGA member facility, team, or individual who has demonstrated environmental excellence through environmental accomplishments going above and beyond regulatory requirements. Awards were given for the following projects:

• •

Air Products and Chemicals, Inc.: Brine Recovery Reverse Osmosis Water Treatment System, Wilmington Hydrogen Plant Matheson: LED Lighting and Energy Reduction Initiative, Packaged Gas Operations Praxair, Inc.: Berm Enhancement Project, Burns Harbor Facility

Indiana Oxygen Again Named in Top 100 “Best Places to Work” Indiana Oxygen Company, the oldest gas and welding distributor in the country, has been named one of the “Best Places to Work” for the third consecutive time by the Indiana Chamber of Commerce and Best Companies Group.   The recognition is based on the company’s corporate philosophy, work culture, benefits, promotion potential, job security, and the surrounding work environments. Indiana Oxygen, of Indianapolis, also made the top 100 list of Best Places to Work in Indiana in 2015 and in 2016. In order to make the first “cut,” at least 40 percent of all employees must complete and submit an anonymous satisfaction and critiquing survey. In addition, Indiana Oxygen had to participate in a statistical survey about the company’s culture, tenure, health plan, wellness program, paid time off, 401k, and fun activities in which its employees engaged.

Women of Welding and Gases Awards First Scholarship A young woman from Pueblo, Colo., has been awarded the first $1,000 Women of Welding and Gases scholarship. Sydney Houghton, a student at Pueblo County High School and Pueblo Community College, has been studying welding for two years and plans to pursue it as a career after completing her associates degree. “My dream is to flip homes and own a construction company,” she writes. GAWDA’s Women of Gases and Welding Committee established the scholarship to help women pursue a certificate, associate degree, or bachelor’s degree in welding, gases, or a related field and who are eager to start a career in the industry.

Italian Firm Signs Exclusive Distribution Deal with Skaff Cryogenics Italy’s VRV has entered into an exclusive distribution agreement with Skaff Cryogenics (SCI) to serve the U.S. and Canadian market, Skaff reports. Summer 2017 • 103


INDUSTRY NEWS Under the deal, New Hampshire-based SCI will become VRV’s exclusive stocking and distribution channel for North America, providing bulk cryogenic tanks for industrial gas, liquified natural gas and hydrogen, as well as microbulk tanks, liquid cylinders and distribution equipment. “We look forward to correcting the U.S. and Canadian markets from overinflated costs and pay it forward,” says Steve Prefontaine, president of SCI. Steve Prefontaine

Company Changes Name to Wise Telemetry Breathewise has changed its name to Wise Telemetry, Founder and CEO Eric Wise reports about the Pittsburgh company. The name change reflects the company’s expanded product offerings beyond its original scope of medical oxygen, Wise says. The company offers telemetry units that allow industrial and specialty gas providers to see real-time customer demand and enhance supply chain efficiency through wireless technology, fluid mechanics and data analytics. Wise Telemetry has been in existence about two years.

Metro Welding Announces Reid’s Retirement

Metro Welding of Detroit, Mich., has announced the retirement of longtime employee Dennis Reid. Reid served as bulk/microbulk team leader and has been active in the gases and welding industry for decades. “We want to wish Dennis well in his retirement,” says Metro Welding’s John “J.P.” Stoneback.

Butler Gas Receives Family Business Award Butler Gas Products, of Pittsburgh, has received a 2017 Family Business Award from the Pittsburgh Business Times. Founded in 1948 by Jack and “Millie” Butler, the company has changed to keep up with the evolving economy of Western Pennsylvania.

Auguste Cryogenics, TaylorWharton Sign Agreement Auguste Cryogenics has signed a long-term liquid cylinder distribution agreement with Taylor-Wharton, an Air Water Inc. company. Under the agreement, Auguste Cryogenics becomes the exclusive distributor for Europe, Russia and Israel of Taylor-Wharton’s extensive line of gas and liquid withdrawal cylinders. Since the acquisition of TaylorWharton’s European operations last fall, Auguste Cryogenics has entered a phase of extended expansion in the biomedical and industrial gas markets. “By partnering with Taylor-Wharton, our company strengthens its product offerings as we continue to find new ways to serve our customers,” says Bobby Cushman, president of Auguste Cryogenics. Eric Rottier, chairman and CEO of Taylor-Wharton, says the agreement, “provides continuity of supply for our 104 • Summer 2017


INDUSTRY NEWS liquid cylinder product line in Europe, Russia and Israel as was in place previously with Taylor-Wharton’s European operations. August Cryogenics will maintain inventory in Germany as well as provide customer support to the regions.”

Coastal Welding Supply Named a “Texas Treasure” Coastal Welding Supply, in Beaumont, Texas, received a Texas Treasure Business Award from Beaumont Main Street. The award recognizes businesses that have been in business for more J.C. “Chuck” Mazoch and than 50 years and have played a role Barbara Mazoch Nelson in the local and state economy. Coastal was established in 1963 by Al Mazoch. Today, led by President J.C. “Chuck” Mazoch, and his sister, Barbara Mazoch Nelson, asset manager, Coastal has nine locations that span Southeast Texas and Southwest Louisiana.

Airgas Holds Ribbon Cutting for Kentucky ASU Airgas, an Air Liquide company, had a ribbon-cutting ceremony for its new air separation unit (ASU) and co-located hydrogen plant in Calvert City, Ky. Airgas says the new ASU produces liquid oxygen, nitrogen and argon, and the liquid hydrogen plant produces liquid hydrogen for a range of customer applications. The ASU supplies tonnage oxygen and nitrogen via pipeline to Westlake Chemical at its Calvert City manufacturing plant, and also supports the region’s merchant bulk gas market. Airgas says the new facility helps ensure the long-term reliability of supply for its merchant gas customers. Michael Graff, chairman and CEO of American Air Liquide Holdings and chairman of Airgas; Pascal Vinet, CEO of Airgas; Tom Thoman, senior vice president of merchant gases, were

Airgas, customers and local officials mark the opening of a new air separation unit in Calvert City, Ky., with a ribbon cutting.

joined at the ribbon cutting by Albert Chao, president and CEO of Westlake Chemical and other customers, as well as state and local officials. The ASU is managed by Airgas’ Merchant Gases division. Following the acquisition of Airgas by Air Liquide in May 2016, Airgas is now the leading U.S. supplier of industrial, specialty, and medical gases and provides bulk gas supplies of oxygen, nitrogen and argon through its 29 air separation units nationwide.

Vern Lewis Welding Supply Names Denk General Sales Manager James Denk has been named general sales manager at Vern Lewis Welding Supply in Avondale, Ariz. “Denk brings years of welding industry service that will drive increased market share and customer satisfaction levels,” the company says in a release. “I’m thrilled to be a part of Vern Lewis Welding Supply and welcome James Denk the challenges that lie ahead. I called on them in my previous role with ESAB. Vern Lewis stood out among the categories that one would thrive a successful business on; a fully engaged team, focused on their employees and the customers they serve. Senior management is passionate, innovative and diligently working to continue the 48-year legacy. I feel blessed to be a part of something truly unique,” Denk says. Denk worked at Praxair for 28 years and, most recently, at ESAB Cutting and Welding Products as account manager for Arizona and South Nevada.

FasTest Brings in Kaufer as Director of Sales Paul Kaufer has been hired as the director of sales at FasTest, in Roseville, Minn. Kaufer will oversee FasTest’s global sales operations. “We were determined to find someone with a strong background Paul Kaufer in managing relationships with distribution partners and growing sales with key accounts,” says Gary Rychley, president of FasTest. “I am excited to have Paul lead the sales team in global expansion of FasTest in the HVAC, compressed gas and the broad-based Summer 2017 • 105


INDUSTRY NEWS manufacturing sectors. Under Paul’s leadership we are expecting to continue to add direct sales people as well as distributor partners to further FasTest’s global presence.” Before joining FasTest, Kaufer most recently served as a sales manager for K-Sun Corporation. His prior experience also includes a broad range of sales management positions at companies such as Toro, HB Fuller and 3M. “Having the opportunity to join FasTest at this juncture is exciting because of the tremendous strides they have made in the marketplace with their technology and ability to meet customer needs,” says Kaufer.

SUMIG Signs Agreement with CAG SUMIG USA Corp. has signed a formalized agreement with the Competitive Advantage Group (CAG). Based in the southwest United States, CAG is a supplier of welding products sold through welding distributors. CAG will be able to offer direct distributor sales support for SUMIG’s lines of products in the California, Nevada and Arizona markets. As part of this agreement CAG will also be a logistical warehouse shipping point, SUMIG says, a move that it says will drastically reduce shipping times for SUMIG’s Western customers.

dependability • versatility • recyclability

SELECT SERIES

106 • Summer 2017

Announcing a new cylinder line now available from Norlab With two new cylinder packages, we bring innovation to the disposable cylinder customer.

Our dependable cylinders and valves are manufactured using high grade alloys and components ensuring greater gas stability over the life of the mix. Two versatile cylinders available that cover all current sizes from 34 liter through 116 liter. We also offer several valve options depending on the gas standard required. 100% recyclable and refillable with no deposits or daily rental fees, these cylinders are returnable or can be recycled locally. To find out more about our new Select Series cylinders, contact Norlab customer service at 800-657-6672 or send us an email us at norlabcs@norco-inc.com Visit us at www.norlab-gas.com to find a Norlab distributor in your area.

Klobucar Promoted to Director of Marketing at FasTest

Andrew Klobucar has been promoted from senior marketing manager to the director of marketing at FasTest in Minneapolis, Minn. “Over the past three years, Andrew has shown a unique ability to develop marketing programs in many areas critical to the success of the company,” said Gary Rychley, president of FasTest. Klobucar has more than seven years of marketing experience and has spent the last three years upgrading FasTest’s website and digital presence, building Andrew Klobucar FasTest’s global brand, and improving customer-facing communications. He has led his team in key sales and channel support initiatives in regards to sales tools, product videos, distribution management programs and web-based marketing. “I look forward to continuing to build the FasTest brand as we further our international expansion efforts and introduce new innovations to the market,” Klobucar says.

Hedlund Named EVP and President of International Welding at Lincoln

Lincoln Electric Holdings, Inc. has promoted Steven B. Hedlund to executive vice president and president of the International Welding segment. Hedlund will lead the European (Europe, Middle East, Africa and Russia) and Asia Pacific regions’ day-to-day operations and oversee the implementation of all strategic, operational and commercial initiatives. He will continue to serve as a member of the management com-


INDUSTRY NEWS mittee. Hedlund succeeds Mathias Hallmann, who has decided to leave the company to pursue other interests. Hedlund most recently served Steven Hedlund as senior vice president and president of global automation. He joined the company in 2008 as vice president, strategy and business development, where he led strategic planning and acquisitions. Previously, he was with Fortune Brands, Inc. and at Booz Allen & Hamilton. He earned a bachelor’s degree and an MBA from Dartmouth College. “I am pleased to announce Steve’s promotion to this role,” said Christopher L. Mapes, chairman, president and CEO. “Steve’s extensive experience, process-driven approach and achievements in advancing our automation strategy will help drive the International Welding segment’s next phase of growth and development with Air Liquide Welding.”

2017 INDUSTRY EVENTS AUGUST

SEPTEMBER

14-15

GAWDA Regional Meeting ▶ North Stonington, Conn.

6-7

GAWDA Regional Meeting ▶ Gettysburg, Pa.

11-12

GAWDA Regional Meeting ▶ Tulsa, Okla.

25-29

Essen World Trade Fair for Welding ▶ Essen Germany

1-4

OCTOBER 31- Nov. 3

NOVEMBER

6-9

GAWDA Annual Convention ▶ New York, N.Y. IWDC Owners Meeting ▶ Amelia Island, Fla. FABTECH ▶ Chicago, Ill.

Timmermann Joins Exocor as Territory Manager Exocor Filler Metals, of Amherst, N.Y., has hired Tim Timmermann as territory manager. His territory will include Michigan, Indiana, Ohio, and Kentucky. Tim Timmermann He comes to Exocor with experience selling in distribution in the United States, most recently with Star Tech Weld and PowerWeld. He also spent 14 years as district manager for OKI Bering.

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800-844-4212 | watson@watsoncoatings.com | 325 Paul Avenue | St. Louis, MO 63135 Summer 2017 • 107


INDUSTRY NEWS

M&A SCORECARD AWISCO Acquires Nyack, N.Y. Metal Equipment Distributor AWISCO NY Corp., of Maspeth, N.Y., a supplier of compressed gases and welding equipment in the New York tristate area, has acquired NYROCK Machine & Tool Corp. of Nyack, N.Y. NYROCK is a distributor of metal fabricating and tooling equipment, founded in 1981. It represents metal fabricating equipment makers including Pat Mooney, Piranha, Automec, Ficep, Marvel and Cleveland Punch and Die. “I am very excited by the expanded product line the NYROCK acquisition brings to AWISCO’s customers,” says Lloyd Lloyd Robinson Robinson, AWISCO president. “Working with NYROCK President Scott Bederka and his team who are joining AWISCO will bring a new dimension to AWISCO’s marketplace.” “Joining the AWISCO team will greatly expand the exposure of the product lines that NYROCK has represented for more than 30 years. I am looking forward to being a part of this dynamic company and working with their dedicated staff, “ says Scott Bederka, NYROCK President.

Linde and Praxair Move Forward on Merger The board of directors of Linde approved the Munich, Germany-based company’s all-stock merger with 108 • Summer 2017

Connecticut-based Praxair, Inc. in early June. In a joint release, the GAWDA member companies say they expect the transaction to close in the second half of 2018, subject to customary closing conditions, including regulatory approvals. Steve Angel, Steve Angel chairman and CEO of Praxair, says, “this combination is a compelling and transformative opportunity to create a world-class leader in the industrial gas industry. The combined company will give us the opportunity to leverage the individual strengths of both companies across a much larger global footprint and enhance our ability to drive innovation and growth.” “This merger is a once-in-a-lifetime opportunity to form a great global industrial gas company poised to deliver value for customers, employees and shareholders alike,” says Aldo Belloni, CEO of Linde AG. Based on 2016 reported results, the combination will create a company with pro forma revenues of approximately $29 billion, prior to adjustments, potential divestitures and regulatory limitations, and a combined current market value in excess of $70 billion, the companies say. Each company will have Aldo Belloni

six members on the new company’s board of directors, with Linde Chairman Wolfgang Reitzle serving as chair. Angel will be CEO of the new group and will also be a board member of the new holding company, according to a joint release. The new holding company will be incorporated in Ireland while its principal governance activities, including board meetings, will primarily be based in the United Kingdom. Angel will be based in Danbury, Conn., and group corporate functions will be split between Connecticut and Munich, Germany. The new group will carry the Linde name. The merger still requires a positive vote from a majority of Praxair shareholders and 75 percent of Linde shareholders need to tender their shares.

Nikkiso Acquires Cryogenic Industries, Inc. Nikkiso Co., Ltd., has entered into an agreement to acquire the business and trademarks of Cryogenic Industries, Inc. of Temecula, Calif., and Cryogenic Industries, AG of Basel, Switzerland, consisting of all its operations, which are conducted by ACD, Cosmodyne, Cryoquip; and their respective subsidiaries. The acquisition is expected to close mid-2017, subject to regulatory approvals, Nikkiso says. “Cryogenic Industries’ culture of industry-leading innovation in cryogenic equipment, services and plants is highly complementary to the core fluid control technology on which our company was founded,” says Toshihiko Kai, president and Chief Executive Officer of Nikkiso.


INDUSTRY NEWS GAWDA Awards Scholarships To 11 College-Bound Students GAWDA leaders announced the awarding of 11 scholarships in May at the Association’s annual spring conference. This year marks the fifth in a row that the GAWDA Foundation has been able to award scholarships for tuition and fees to high school students who are planning programs of study they can use in welding and gases distribution industry careers. The 2017 awards, which are in the amount of $2,000 each, bring to $116,000 the total amount of scholarship monies awarded by the organization since it began the scholarship program in 2013. GAWDA First Past President Bill Visintainer, of Atlas Welding Supply Inc., in Tuscaloosa, Ala., announced the names of the 2017 recipients as: • Dakota Akins of Katy, Texas, who will be attending Texas Welding School & Tech • Kyle Blommer of St. Cloud, Minn., who plans to study at the University of Minnesota • Douglas Bolinger of Pierceton, Ind., who is attending Ferris State University • Andrew Colston of Fremont, Ohio, who is attending Capital University in the fall • McKenzie Colston of Fremont, Ohio, who is matriculating to Xavier University • Carrie Cota of Roundup, Mont., who will be going to Rocky Mountain College • Zach Poticny of Tuscaloosa, Ala., who plans to attend University of Alabama • Joshua Shubert of Oakwood, Ga., who plans studies at Brenau University • Stuart Thorburn of Richmond, Ky., whose studies will take him to Bluegrass Community & Tech College • Kami Tuohy of Meridian, Idaho, who will study at the College of Western Idaho; • Brianna Wukawitz, of Cottage Grove, Minn., who will study at University of Minnesota. “GAWDA is very pleased to present these tuition awards again this year. The 11 recipients are promising young students, and our membership wholeheartedly supports their interest in studies they can later apply in the welding and gases industry,” said Association Executive Director John Ospina. “Our Association and our members view this program as an essential part of recruiting and retaining a dedicated work force of quality, knowledgeable individuals, and in continuing to attract young people of promise into our industry.” GAWDA began its GAWDA Foundation Scholarship Program in 2013 in an effort to help educate, attract and keep quality individuals in the industry, according to Ospina. The generosity of GAWDA member businesses supports the scholarship program. This year, contributors were: Airweld, Inc.; Arc3 Gases; Atlas Welding Supply Co. Inc.; AWISCO; Central McGowan; Coastal Welding Supply, Inc.; CPV Manufacturing; CryoVation; Dale Oxygen; EXOCOR; Holston Gases; ILMO Products; Keen Compressed Gas Company; Linde; Luxfer Gas Cylinders; Mississippi Welders Supply Co.; O.E. Meyer Company; Oxygen Service Co.; Taylor-Wharton; Vern Lewis Welding Supply Inc.; Wayne Oxygen Co.; WDPG Insurance Program; and WISCO. To date, a total of 261 individuals have applied for the scholarships, and 58 awards have been granted. The number in 2017 was 11; in 2016, 10; in 2015, 12; in 2014, 14; and in 2013, 11 scholarships were awarded, for a total of 58 tuition-dedicated gifts. To apply for the scholarships, applicants must be an employee or a child of an employee of an active GAWDA member company.

In Memoriam

JOHN “JACK” TOEPKE John Arthur “Jack” Toepke, chairman and chief executive officer for TOMCO2 Systems, passed away April 16. Toepke was involved with TOMCO 2 since its founding in 1970, as well as its former parent company, Carbonic Industries Corporation. A native of Illinois, Toepke was a Cubs fan, an avid golfer and, most recently, a gardener. He is survived by his wife, Freda, sons Jack Jr. and Jim, his daughter and son-in-law, Joleen and Doyle Kirkland, their mother, Jane, and two grandchildren. To submit In Memoriam remembrances or other industry news, contact: editor@ weldingandgasestoday.org or call 315-445-2347.

Summer 2017 • 109


TECHNOLOGY

Here’s What’s

‘APP-ening’ WHAT’S APP-ENING NOW?

Let’s look at apps that are specific to those in the welding and gases industry. The convenience and practicality of these apps is apparent when you think about how many reference books you can leave behind, how many emails you won’t have to check and how quickly you’ll find yourself unable to operate without these solid industry-centric apps. Check them out!

HOBART BROTHERS WELD APP

FREE

You may know what filler metal to use when joining metals you work with regularly, but what if the day brings a new joining challenge? Hobart Brothers Filler Metal Selector and Calculator app provides a filler metal selector for aluminum, stainless steel and carbon steel, as well as a heat input calculator, hardfacing product cross reference and a filler metal volume calculator from GAWDA member Hobart Brothers. It works in standard and metric units. The app includes links to Hobart products that match the recommendations.

BLUE DEMON FILLER METAL SELECTOR

FREE

GAWDA member Welding Material Sales’ Blue Demon Filler Metal Selector app suggests filler metal alloys for welding and brazing. Enter the base metals using ASTM numbers and other industry terminology and get results immediately. The app includes 287 steel-, stainless steel-, aluminum-, copper- and nickel-base metals. Welding Material’s Brian DePaul says the app has been downloaded thousands of times. He says it was designed to be particularly helpful to distributors and their sales people when they are meeting with customers.

BLAST Blast lets you program in the content you want to convey, helping spread information on many useful and necessary topics (such as policies and procedures, human resources information, safety and compliance topics, product information, company culture and values) to employees or others in a way that’s mobile, fun, fast, simple and engaging. GAWDA Supplier Member Chemweld, Inc. (whose president is Linda Smith) is the distribution partner for the app development company. As Smith explains, a dedicated game site is set up for each organization. Employees are invited to play the game, earn points and get instant feedback while answering questions and recalling information. Companies can track knowledge and retention results through dashboards and reports. Contact Smith at Chemweld, Inc. for cost information: 800-241-4919; info@chemweldusa.com. 110 • Summer 2017


NEW OFFERINGS

PRODUCTS | SERVICES | TECHNOLOGIES 1

4

2

5

1. M.K. Morse Offers Improved Hole Saw

The M. K. Morse Company reports recent discoveries at its technology center have led to dramatically improved cutting times and extended product life for its bi-metal hole saws. Available exclusively through authorized distributor partners across the globe, the all-new Morse bi-metal hole saw is manufactured exclusively in Canton, Ohio. It features a deeper cut depth, improved side slot, and a proprietary cutting edge. M.K. Morse says its tests confirm the saw works more quickly and cleanly than all other bi-metal hole saws.

2. Osborn Announces New Line of Discs

Osborn has a new line of cut-off discs, grinding discs and flap discs. The new cut-off discs cut fast and last long with multiple styles, Osborn says. The line of grinding discs offers users the durability and superior removal rates, including a high-performing Ceramic EXT line, Osborn says, adding that the flap disc line delivers removal and finishing.

3. Praxair’s NuCO2 Launches New CO2 Supply System

Praxair, Inc. announced that its subsidiary, NuCO2, the largest provider of fountain beverage carbonation in the U.S., has launched the XactCO2 HP, a permanent, scalable carbon dioxide cylinder supply system for restaurants and bars. The XactCO2 HP fill system is currently being launched in Denver, Atlanta, and the greater San Francisco area, and will be launched nationwide later in 2017. Cylinders are located inside the facility and connected to a small fill box located outside the site. NuCO2 service representatives fill the cylin-

der system from a truck at regularly scheduled intervals that support the establishment’s monthly volume requirements. This results in fountain soft drinks and draught beer being properly carbonated, Praxair says.

4. Abicor Binzel Launches New MIG Guns

Abicor Binzel has released three new semi-automatic MIG guns to its product line. The main launch is the ABIMIG AT, engineered to be the air-cooled complement to the water-cooled ABIMIG WT. The AT, with three models ranging from 230 amps to 400 amps, features an ergonomic handle and lightweight cable assembly for operator comfort. The quick-change necks rotate up to 360 degrees and come in an array of lengths and angles for welder access. A fixed neck ABIMIG A and fixed neck water-cooled ABIMIG W were also released with the AT in late April.

5. ESAB Introduces New High-Contrast Gauges

ESAB has introduced Victor EDGE 2.0 heavy-duty, high-capacity single-stage cylinder regulators. EDGE 2.0 regulators are available for all common gases, including acetylene, L.P. (propane), oxygen, air, hydrogen, carbon dioxide and inert gases, the company says in a release. EDGE 2.0 features an extra-large 2 ½-inch diameter delivery gauge and uses a high-contrast, color-coded face to enable operators to more easily see and set delivery pressure. The cylinder pressure gauge is smaller and offset to create a difference in depth perception. For further clarification, “HP” and “LP” are molded into the gauge guards. Summer 2017 • 111


ADVERTISERS INDEX 3M Company...........................................................17

Hobart Institute of Welding Technology.......................82

ABICOR Binzel USA..................................................26

Kaplan Industries.....................................................36

Acme Cryogenics ..................................................104

Kobelco Welding of America......................................37

ALM Positioners.......................................................63

The Lincoln Electric Company.....................................7

American Torch Tip Company (ATTC).........................65

McDantim................................................................54

AmWINS Program Underwriters.................................83

Mercer Abrasives.......................................................5

Anthony Welded Products...................................46, 61

Norlab...................................................................106

Arcos Industries......................................................IBC

Norton Abrasives....................................................... 8

ASM- American Standard Manufacturing...................69

ORS Nasco............................................................101

Black Stallion...........................................................41

Phoenix International................................................71

California Cylinder....................................................26

Ray Murray Inc.........................................................70

Carborundum Abrasives...........................................24

Reelcraft Industries..................................................88

Catalina Cylinders....................................................87

RegO Cryo-Flow Products.........................................38

Cavagna North America............................................23

Rotarex North America..............................................45

CGW- Camel Grinding Wheels...................................75

SafTCart..................................................................57

Chart Industries.......................................................85

Select-Arc, Inc........................................................ BC

CK Worldwide..........................................................29

Sherwood Valve.......................................................43

Cryofab...................................................................82

Superior Products....................................................77

CTR..........................................................................3

Taylor Wharton Cryogenics..........................................9

Cyl-Tec....................................................................13

Tech Air...................................................................41

ELCo Enterprises......................................................83

Thermacut...............................................................99

Eleet Cryogenics........................................................9

Thermco Instrument Corp.........................................79

Exocor.....................................................................27

Veite Cryogenic Equipment & Service Corp..................1

Fein Power Tools......................................................11

voestalpine Bรถhler Welding.......................................21

FIBA Technologies....................................................22

Watson Coatings, Inc..............................................107

Flexovit USA............................................................81

WEH Technologies....................................................80

Gas Innovations/WWS..............................................94

Weldcoa..................................................................39

Generant Company..................................................94

Weldcote Metals......................................................58

Gullco International..................................................49

Weldship Corporation...............................................84

H & H Sales Company..............................................27

Western Enterprises.................................................30

The Harris Products Group .....................................IFC

Worthington Industries..............................................55

112 โ€ข Summer 2017


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Welding & Gases Today - Q3 2017  

The third quarter 2017 issue of Welding and Gases Today, the official publication of GAWDA,

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