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2004 Industry Forecast In our Second Annual Business Forecast, Welding & Gases Today randomly polled GAWDA Distributors nationwide by telephone. The polls revealed optimism, for reasons ranging from higher demand to technological advancements to new sales methods. Many believe that the era of giving product away is ending, and the increased emphasis on price-cutting is coming to a close.
On the other hand, no one believes that the downward pressure on pricing will change in the near future. Distributors are likely to continue to face increased costs of doing business. Double digit increases in insurance premiums—health, property and casualty—and budgeting for increased overhead associated in maintaining long-tenured employees will force the winner in 2004's race for improved margins to keep his or her eye on the bottom line. It is unlike GAWDA members to let a few challenges deter them. Over 89% of those interviewed predict a sales increase, some by as much as 22%. The overall average increase is about 8%. The West (11.1%) and Midwest (10.8%) regions predict the strongest growth, but every region expects to be up by at least 6%. Look for more in-depth analyses of these trends and more in the latest issue of Welding & Gases Today, mailed and online March 15. Business Ethics Business ethics are a hot topic these days. With everything from insider trading to employee theft on the rise, it is no wonder that businesses are beginning to focus on the impact of ethical leadership. But along with this new focus comes a lot of "gray area." Many times, managers are forced to decide on issues where there are arguments on both sides—a problem that makes ethical decision-making very difficult. GAWDA Distributors take on the issue in the March edition of Welding & Gases Today, mailed and online March 15.
Smith Welding Goes that Extra Mile Smith Welding Supply & Equipment, based in Ferndale, MI, had built a solid customer base among metal fabrication companies involved in the automotive industry. The problem, if you can call it that, was that the demand for Smith services—most notably filling and delivery of a wide range of weld and specialty gases—was beginning to challenge capacity at the company's one-acre, 15,000 sq. ft. downtown Detroit plant.
Smith Welding President Irv Sparage found a 40,000 sq. ft. facility vacated by a competitor, with infrastructure already built in, but no equipment. It had a fill plant with no manifolding or piping. Sparage called upon longtime vendor Veite Cryogenics, which 30 years earlier had equipped Smith Welding's first Detroit plant. Veite's co-owners, James Veite and James Harris, helped Sparage design an operation that would improve his company's efficiency. That process would begin with a gravimetric setup on its liquid Argon operation. This digital scale-controlled process automatically shuts off filling at a predetermined weight. Monitors who previously had to oversee the filling could now spend more time on the company's high pressure filling operations. A customer base made up of automotive fabricators eagerly awaited the transformation. In the fast-paced world of automotive manufacturing, any slowdown, no matter how small, would pose a problem not only for the customer, but for Smith Welding as well. Veite helped the distributor transition to the new plant without stopping production, and the added capacity and improved efficiency gave the distributor the capabilities to fill 6,000 psi Nitrogen, Helium, Argon, Oxygen and CO2 cylinders, using automated fill controls. After moving from its old plant located just south of Detroit's famous 8 Mile Road, to the new facility just south of 9 Mile Road, Smith Welding Supply & Equipment demonstrated that a little extra mile can go a long way. GAWDA welcomes new Associate Member Prometheus V LLC of Los Angeles, CA. INDUSTRY
BEAT FDA Issues Final Rule on Bar Code Labeling — Medical Gases Exempted • FDA has released its final rule on "Bar Code Label Requirements for Human Drug Products and Biological Products." Medical Gases have been specifically exempted from the requirement. You can read the Final Rule document by clicking here. Airgas Following Acquisition Strategy (Cleveland, OH) • Airgas acquired the assets of both Interstate Welding Sales Corporation (Marinette, WI) and Littell Industries (North Hollywood, CA). The Interstate acquisition, expected to close on March 31, includes a main office and cylinder fill plant in Marinette and six Wisconsin branches in Appleton, Fond du Lac, Green Bay, Manitowoc, Milwaukee and Schofield, as well as branches in Michigan's Upper Peninsula in Escanaba, Iron Mountain and Marquette. Airgas plans to run these locations as part of Airgas North Central. Bill Higley, Interstate president and CEO, was named national manager - distributor channel, effective April 1, to support the Airgas regional companies in coordinating the services they provide to distributors and resellers. The acquisition of Littell Industries, a distributor of medical gases, equipment and piping installations, includes a medical gas distribution plant in North Hollywood and two branches in Bakersfield and Santa Ana, which will be integrated into Airgas West. A fourth Littell branch in Hayward, CA, will be integrated with Airgas Northern California & Nevada. Jon Holmwood, president of Littell, will join Airgas West as a medical products leader, and Littell's Clarke Marshall will join as a sales manager for the pipeline installation business. Kroll Named Matheson Tri-Gas Chairman (Parsippany, NJ) • William J. Kroll was appointed chairman of Matheson Tri-Gas, effective March 1. Kroll will also continue in his current role as president and CEO. Sweet Leaves Post as Proton President (Wallingford, CT) • Dr. Larry M. Sweet, president of Proton Energy Systems, is leaving the company to pursue other interests. Chip Schroeder, president of Proton parent Distributed Energy Systems, will serve as Proton president until a successor is named. Leidy Named Weldship GM (Westborough, MA) • Roy Leidy, previously director of quality, was promoted to general manager of Weldship Corporation. Recent company growth dictated the need for a position to lead the infrastructure development of plant operations, engineering, retesting and quality. Huck Named Air Products CFO (Lehigh Valley, PA) • Air Products elected Paul E. Huck vice president and CFO. Huck will be responsible for all aspects of worldwide financial organization, including controllership, treasury, investor relations, tax and audit. Huck will succeed John Owings, who is leaving the company to pursue other interests. Surcharges Force Price Increases (Camp Hill, PA) • Taylor-Wharton announced price increases covering standard cryogenic bulk tanks, liquid cylinders, beverage carbonation cylinders, certain cryogenic freezers, high pressure cylinders and acetylene cylinders. Recent increases in the base price of steel and steel-related surcharges have caused the company to adjust its price schedules on a monthly basis. Airgas Receives Five ISO 9001:2000 Certifications (Radnor, PA) • Five Airgas specialty gas facilities were certified to the ISO 9001:2000 standard by Quality Systems Registrars Inc. The scope of the three-year registration is for the manufacture and sale of specialty gas at the approved sites. The five facilities, all of which produce a range of pure gases and specialty gas mixtures, are located in Piscataway, NJ; Allentown, PA; St. Louis, MO; San Jose, CA; and Salt Lake City, UT. Airgas Forms Puritan Medical Divisions in Each Region (Radnor, PA) • Airgas has formed Airgas Puritan Medical divisions within each of its 12 regional companies. Each division includes existing Puritan Medical branches within the region, as well as all existing Airgas dedicated medical resources, facilities and personnel. Overall, Airgas Puritan Medical will leverage more than 150 medical gas fill plants, including the 35 medical-only fill plants, and a distribution network that includes more than 600 branches. PMP employees will transition to the new divisions in their region, effective April 1, 2004. Kelly Justice was appointed senior vice president - Airgas Puritan Medical, reporting directly to Airgas President and COO Glenn Fischer. The team reporting to Justice includes members of Puritan Medical Products' current senior management: Bill Fettes, vice president - operations; Richard Sniezek, vice president - sales; John Walsh, vice president - marketing; and Adam Hoyt, vice president - finance. Industry Heating Up • The Ides of March marked the end for Julius Caesar, but it will signal a new beginning for the re-energized welding and gases industry. Welding & Gases Today, mailed and online March 15, has exciting features sure to interest any GAWDA member. Read where the industry is headed straight from the distributors themselves in the 2004 Industry Forecast. See what Duane Sylvia, consumer safety officer at the FDA Center for Drug Evaluation and Research, predicts for the medical gas market. Get tips about what to look for from the federal government in 2004. Find out how distributors promote ethical behavior when they talk about Business Ethics in the Gases and Welding Industry. W> has all this, plus features on management succession, health insurance, efficient pumping and the usual consultants' insights. Don't miss it!
Literature Library • Manufacturers and suppliers are making it easy for you to do business with them by making their product brochures available for easy viewing and download. Access the Literature Library on GAWDA's home page under the Resources tab or click the icon on the right. Product information when you want it, how you want it. GAWDA's Annual Profit Survey Mailed • The 2004 GAWDA Profit Report survey forms were mailed to Key Contacts of distributor members last week. The report will enable you to measure yourself against over 100 financial benchmarks. In addition, participants will receive a specific game plan for improving their companies' financial performances and expected profit targets. Participants will also receive a Microsoft Excel-based software program to help prepare financial plans for their businesses. If you did not receive your survey form, please contact gawda@gawda.org to receive a copy. To maintain the strict confidentiality of your financial information, the surveys should be sent directly to Profit Planning Group, not GAWDA. 2004 Compensation Survey Submissions Due by March 15 • The deadline has been extended to participate in this vital benchmarking survey of compensation and employee benefits trends in the industrial gases and welding supply industry, as well as over 30 other wholesale distribution industries. This study is absolutely the only place to get this kind of information. Contact GAWDA at 215-564-3484 to receive a copy of the survey if you don't already have one. GAWDA Sponsors Model Curriculum for Industrial Distribution • GAWDA is backing an initiative started by The Power Transmission Distributors Association to create a model curriculum in Industrial Distribution at community colleges across the United States and Canada. Thus far, three institutions have added Industrial Distribution majors to their course offerings, but the initiative needs the support of more distributors and manufacturers to reach the next level. As a sponsor, GAWDA can now participate in nationwide Advisory Councils that meet with faculties to create the new curriculum. Contact GAWDA headquarters at 215-564-3484 if you would like to become involved in bringing this model curriculum to a local community college. NAW's Tell Congress Web Site • Click here to access a Web site provided as a service by NAW/WDPAC and its partner BIPAC that identifies your U.S. Congressmen by zip code and provides you with a link to send an e-mail communication. Tell your Congressmen what issues are important to you. $5,000 Scholarship Available • Pembroke Consulting and Modern Distribution Management are offering a $5,000 scholarship designed to foster thought leadership in the wholesale distribution industry. Full-time college students at accredited U.S. or Canadian universities are encouraged to apply for the scholarship. Entrants are required to submit an essay discussing how technology will affect the supply chain and the future strategies of wholesaler-distributors. Deadline for application is August 1, 2004. Download a copy of the entry form and necessary requirements at http://www.mdm.com/pdfs/mdmscholar.pdf. Wholesale Distribution Industry Report • A new edition of the wholesale distribution industry report, Facing the Forces of Change, is being released in March. The report provides strategic insights into key trends impacting the wholesale distribution supply chain through 2008 and covers key industry demographics, four major trends impacting wholesaler-distributors, competitive threats to distributors, supply chain technology, sales force issues, manufacturer relations and much more. To order, select NAW Publications on the Business Services page found under the Resources tab of www.gawda.org.
Welding Rod
Litigation Plaintiffs' Meeting
CGA's Cylinder
Fill Plant Safety Seminar
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