It’s not the rough grinding disks, strong hand tools or welding helmets that stand out in Maine Oxy’s company store at its Auburn headquarters.
It’s the Elvis memorabilia at the cashier’s desk, where the display showcases miniature pink Cadillacs, a copy of Elvis’ driver’s license, an Elvis clock and various tin boxes emblazoned with the image of “The King.” The collectibles belong to the person staffing the counter, who turned out to be a huge Elvis fan.
The Elvis gear also illustrates the company’s personality. Employee-owned since 2004, the industrial, medical and specialty gas company encourages its workers to make decisions on the spot rather than running everything past management. The result is a company where workers stay 20 or more years — one person worked there 42 years before retiring two years ago.
Today, the company has expanded its stores to 15 locations throughout New England and plans to fan out even farther, south of New Hampshire, where it is seeing growing demand for its wide range of gas products. The gases are used in welding, calibration, medicine and even in food and beverages, in which nitrogen helps keep bagged salad fresh and carbon dioxide produces bubbles in beer and soft drinks.
“The company is progressive on how we approach the market. It’s fun to work here, and employees are empowered to deal with a problem right there (at its source),” said Carl Paine, business development manager at Maine Oxy, himself a 26-year veteran. Indeed, a sign on the factory floor reads, “Work like an owner, think like a customer.”
In October 2012, employee Dan Guerin, who is president and CEO, bought 51 percent of the company, vowing to keep it independent. Maine Oxy still is sorting through what that means in terms of continued employee ownership. That is, whether the ownership percentages will stay the same or the employee owners will sell back some of their position in the company, Paine said.
“I saw an opportunity to become majority owner of a great company and grow it. And keep us independent,” Guerin told Mainebiz during a recent interview at company headquarters. “We think being independent is a must. We empower all of our employees to make decisions, to move quickly. Larger companies have a lot of red tape.”
He added that if a customer runs out of a product, Maine Oxy can get it there quickly, rather than having a long and involved ordering process.
Customers gas up
While the company did see a slowdown during the recent recession, with some portions of the industry slowing and others picking up, it has nonetheless grown rapidly, adding five new store outlets in New Hampshire, Vermont and Connecticut in the past six years and bringing the total in those three states, plus Maine and Massachusetts, to 15. Revenue is about $38 million, and is expected to top $40 million next year. Paine said the company is “very profitable,” but declined to give specifics. Its employee count has risen to 157 from about 140 in 2007.
Demand from wholesale customers, such as industrial, medical and veterinary laboratories and businesses, also is strong. In Maine, the market has leveled off, but Guerin expects to tap markets south of New Hampshire, where demand is growing and warmer overall weather means year-round sales. That can offset the slowdown in certain market segments, such as construction, that befalls the company once frost sets in.
“Winter is a struggle for us. Construction companies slow down. The ground freezes,” Guerin said. “Construction uses a lot of our product. January and February are slower for us, but in the spring it is crazy busy.”
Other markets, such as aerospace/aeronautics, are steady year-round. The company has expanded by acquisition as well, buying existing stores in Naugatuck, Conn., and Rutland, Vt.
The company sells gases and installs piping in new or rebuilt labs and facilities. Its affiliated welding school is a nonprofit venture. The company’s core sales are industrial and specialty gases. Maine Oxy sells dozens of types of gas, including specialty gases and calibration gases, in 20 countries. Overseas markets are an opportunity for the company, Paine said, but it isn’t seeing huge growth in them yet, has no stores overseas and thus remains focused on the United States.
The $2.9 billion specialty gas industry has been expanding 3.5 percent annually over the past five years, according to the Freedonia Group. The Cleveland, Ohio, market research company predicts that global demand in the $35.7 billion industrial gas market will rise 8 percent through 2014.
Manufacturing will remain the largest market for specialty gases, with health care growing the fastest.
Training welders
The company runs the nonprofit New England School of Metalwork to train welders, who are in short supply and aging out of the business. The school is for displaced workers or those who want additional job training. Maine Oxy also runs a Mobile Weld Training Center that visits high schools. While Maine Oxy doesn’t employ the welders, the payoff is in helping supply workers to customers, some of whom use acetylene for welding.
The average welder is about 56 years old, and when he or she retires, young people aren’t moving in to fill the spot, Paine said.
“Welding could be a lucrative career,” he said. “But today, kids want to go with computers. They don’t like getting their hands dirty.”
That’s why the company takes its mobile center to high schools, where welding classes used to be taught. Paine said welders can earn from $12 to $30 per hour, or more.
It’s a way to see the world, Guerin said. “One of our former employees traveled all over the country (welding) on wind farms,” he said.
The lack of welders is costing Maine business, Guerin said.
“One local business shipped its product to be made in Canada (because it couldn’t get welding here),” he said. “There’s a trickle-down effect. This is a national problem, not just in Maine.”
Paine said welding was considered a dirty trade 30 years ago, but with today’s fume extraction and ergonomics, the profession is cleaner.
Along with that trend, the demand for acetylene gas for welding is being supplanted by other processes and alternative fuels such as propane and propylene-based products. Newer devices, including plasma cutters, are powered by electronics instead of fuel gas.
Specialty gases
The company latched on to the growing demand for specialty gases in 1993, when it established the Spec-Air Gases and Technologies division. It also is carving a niche within that market by selling the recyclable Enviro-Cyl gas cylinder, which it hopes will replace some of the disposable cylinders now dominating the market. The recyclable cylinder can be refilled. Initially, it costs more to buy the cylinder, but over time the customer is only paying for the gas. Cylinders are tested every five years to see if they can maintain adequate pressure.
Maine Oxy continues to look at appropriate cost controls and procedural improvements, especially considering safety, Paine said. One recent improvement is electronic cylinder tracking, by which each cylinder contains a bar code and a stamped-on serial number so it can be tracked for location, whether it is filled or empty or even whether it is stolen or loaned to someone else.
The company keeps a float of 100,000 cylinders of all sizes at its factory. They are made of steel, and can weigh up to 120 pounds. The recyclables are made of aluminum.
“Cylinders are our biggest assets, other than people,” Paine said. “They’re expensive to purchase, and they last a long time.”
Maine Oxy
Address: 22 Albiston Way, Auburn
President/CEO: Dan Guerin
Founded: 1929
Employees: 157
Products/services: Industrial, medical and specialty gases; welding school
Divisions: Spec-Air Gases and Technologies, Dirigo Technologies, New England School of Metalwork (nonprofit)
Revenue: $38 million
Contact: 784-5788
www.maineoxy.com
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