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Weld Specialty Gas & Equipment Inc.

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Weld Specialty’s diversification and aggressive approach have added customers and quadrupled the company’s sales in the past 13 years.

By Tim O’Connor

Speed is key for small businesses. When a manufacturer or food packager wants to expand their facilities or introduce new product lines, every moment spent waiting for equipment or materials is time wasted. Companies want to work with suppliers and distributors who can match their momentum. In the Wisconsin gas and welding market, that distributor is Weld Specialty Gas.

“We are able to make fast decisions the big guys really can’t make,” owner and President John Dunfee says. Dunfee co-owns the company with partner Vice President Scott St. Peter, and the two take a hands-on approach that eliminates the lengthy approvals process found at some larger companies. If a client needs a bulk solution for industrial gases, Weld Specialty can make a visit and have them signed up in the same week.

Even though it’s a regional independent, Weld Specialty also competes on price. The company is a member of the Independent Welding Distributors Cooperative, an organization of North American distributors that leverages combined buying power to negotiate deals with vendors. “We have a national presence with a local feel,” St. Peter says.

 

Diversifying Market

Weld Specialty began in 1980 when two salesmen from the welding industry, Jim Schmeling and Paul Sullivan, decided to leave their jobs and set up their own business in Grafton, Wis. Dunfee became the CPA for the young company in the mid-’80s and quickly became friends with the owners. By 1995, Weld Specialty had established itself as a player in the Wisconsin market. Weld Specialty box

Around that time, a global industrial gas company was preparing to purchase Weld Specialty when the deal unexpectedly fell through. Instead, Dunfee, St. Peter, and another employee – Doug Campbell – made the same offer and bought the company out.

When Dunfee and his partners took over in 1995, Weld Specialty had 15 employees and distributed only hard goods such as welding equipment and abrasives. It was evident the company needed to diversify its offerings to grow. That necessary change took root in 2003 when two industrial gas veterans, Bob Lang and Joe Cappozzo, bought into Weld Specialty and led it into the gas business. At the same time, the company opened its second location, in Kaukauna, Wis., near Green bay, to serve its new gas customers.

The move to diversify worked as Weld Specialty went from fewer than 400 clients in 2003 to several thousand today. Its customer base now includes a range of industries from metal fabricators and foundries to cheese factories, food packagers and home brewers. “We have a much wider variety of customers today,” Dunfee says.

Serving such a diverse group of customers requires different approaches. Take the home brewer or welding hobbyist, for example. Most welding and gas distributors are closed on weekends when those customers have free time to work on their passion. But three of Weld Specialty’s stores have Saturday hours and even offer training classes in the mornings with certified welding inspectors.

It’s an investment in time that St. Peter says pays off in more mindshare. “We look to that market not only for growth, but those kinds of people who are home hobbyists are working somewhere in our industry for a job so it helps us gain market share,” he explains.

Since introducing gas, the company has boosted its workforce from 18 to 62 people and quadrupled sales. The company also expanded its footprint by acquiring Allied Welding out of Milwaukee in 2007 and Waukesha, Wis.-based Repair Alloy in 2015, and building a store in Fond Du Lac, Wis., in 2009. Weld Specialty now operates four locations and serves the entire state of Wisconsin.

Dunfee credits the company’s growth throughout the 2000s to the ability of each of its five owners to bring a different area of expertise to the company. However, three of those owners have since retired, leaving Dunfee and St. Peter as equal partners in Weld Specialty. “We have kept going on the same path, which was strong, aggressive growth and trying to fight the national distributors every day,” Dunfee notes.

Weld Specialty stayed aggressive even as the country and world slid into the Great Recession. Dunfee says sales decreased by 12 percent during 2008 and 2009, but the company responded by grabbing market share to offset the losses. By viewing the recession as an opportunity, Weld Specialty managed to secure new customers and avoided layoffs. “While everybody was cutting and slashing in 2009 we didn’t lay off any employees,” he adds.

Preparing for Future

After only 13 years in the market, the industrial gas business has surpassed hard goods as Weld Specialty’s primary business. Weld Specialty mixes argon, oxygen, nitrogen, carbon dioxide, helium and hydrogen at its four locations and rents large bulk tanks and smaller cylinders to customers.

Still, hard goods remain a vital part of the company. The move toward automation is driving much of Weld Specialty’s hard goods business. The company is the exclusive seller of ALM Materials Handling positioners and offers products from Miller Welding Automation.

The rising interest in automation equipment prompted Weld Specialty to recently create a position purely dedicated to automation. “More and more customers are looking for better ways to produce products more efficiently in their factory, and they’re really looking to automation to see those efficiency gains,” St. Peter says.

To be effective, Weld Specialty must match the right blend of gas or piece of equipment to the client’s need. The people driving that interaction are the company’s 10 outside salespeople, who are responsible for working with the customer and staying up to date on the new technologies coming into the industry. Weld Specialty values its outside sales team so highly that in 2015 it even brought in one of its top performers, Steve Betthauser, to manage the entire group.

“What sets us apart is we have a very knowledgeable staff that is very fleet of foot,” St. Peter says. “When a customer comes knocking, we really strive to put our best foot forward, put one of our people in their facility as soon as possible and solve their problem.”

Weld Specialty’s success is tied to its employees, which is why the company is making efforts to ensure it develops the next generation of experts. St. Peter says that attracting young people to the welding and gas industry is difficult, but Weld Specialty reaches students by conducting training in high school classrooms and participating in Maker Faire events. “There is a good living to be made,” he explains. “Just because you’re not college bound, [this is an] industry where you can learn and do very well.”

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