Middlesex Gases & Technologies

Third-generation Boston area distributor takes a calculated risk on an emerging market.

Middlesex Gases & Technologies President Bo Martin understands the meaning of “risk.” A third-generation distributor, he took a leap of faith only a short time into his tenure as president of the company, steering Middlesex into an emerging market that previously comprised only a fraction of its overall sales, and which now serves as Middlesex's primary growth market. Today, the company continues to invest in new technology to find even better ways to serve its growing base of loyal customers, while still practicing the fundamentals of customer service that have been the foundation of Middlesex Gases & Technologies' success for more than a half-century.

President Bo Martin (left) and Executive Vice President Tom Martin are the third generation of Middlesex leadership.

Evolving Markets
The company was founded in 1949 as Middlesex Welding Supply by Joe Martin, a former Airco salesperson who decided to strike out on his own. The region surrounding Middlesex's headquarters in Everett, Massachusetts, just a few miles north of Boston, was heavily reliant on the manufacturing and shipbuilding industries at the time, and these industries became the new distributorship's customer base. After Martin passed away in 1974, his son, Joe Martin Jr., took over the reins of the company, and after Joe Jr.'s retirement in 1991, his son, Bo Martin, became president. Today, Middlesex serves customers throughout eastern Massachusetts, southern New Hampshire and all of Rhode Island.

In the over four decades between the company's founding and its transition to the third generation of leadership, a change had begun to take place in the region's economic base. “Over the last 20 years, the welding and metal fabrication business in this marketplace has been flat to down,” says Bo Martin. “A lot of those companies have gone out of business, out of state or out of the country. The businesses that remain are fairly busy, but they're mostly smaller firms. However, what we have seen is a very large growth in the biotech and pharmaceutical markets.”

When Martin took over as president in 1991, Middlesex was “on the fringes” of the biotechnology and pharmaceutical markets, with a small base of specialty gas customers, but the majority of the company's sales were still rooted in the manufacturing and metal fabrication markets. However, Martin realized that a change was coming and Middlesex needed to be prepared for it.

“I was reading newspapers to learn about what was happening with our manufacturing base, and also stories about growth in the biotech industry,” he says. “A lot of biotech firms were coming into the state at that time, particularly in Cambridge, because they feed off the extensive university base here, including Harvard, MIT, Boston University and Boston College. So the decision to move more into the specialty gas business was based primarily on that knowledge. We didn't do any scientific studies, or hire a firm to give us their outlook over the next ten years. In a way, it was instinctive.”

COMPANY SNAPSHOT President: Bo Martin Executive Vice President: Tom Martin Year Founded: 1949 Year Joined GAWDA: 1951 Headquarters: Everett, Massachusetts Branches: Haverhill, Framingham and     Plainville, Massachusetts; Warwick,     Rhode Island Employees: 66 2006 Sales: $13 million Web Site: www.middlesexgases.com

Making the Transition
Among the first steps the company took to reflect its expanded focus was the adoption in 1992 of a new name: Middlesex Gases & Technologies. But perhaps the most important step in pursuing the specialty gas market was the addition of a specialty gas lab and filling capabilities at Middlesex's Everett, Massachusetts, headquarters in the mid-1990s. An investment of $135,000 allowed Middlesex to outfit its specialty gas lab with the required equipment to allow the company to provide high purity, research grade and custom blend gases to its customers.

“Prior to that, we were buying our products from our gas supplier,” says Martin. “Putting in our own specialty gas filling plant allowed us to be more price competitive and made us responsible for the quality of the product, so we're not relying on somebody else. And as far as product availability, the more we can do in-house, the better off we are.” With improved ability to react quickly to customers' needs, the company saw a return on its initial investment within the first year.

At the time Middlesex made the decision to pursue the specialty gas market, its outside sales force was “pretty much generic,” Martin says. As with many independent distributors, Middlesex's salespeople were assigned geographic territories and promoted both gases and welding supplies and equipment. To improve the company's ability to cater to the biotechnology market, one salesperson was selected for extra training that would allow him to focus strictly on that market segment.

Middlesex's Plainville, Massachusetts, fill plant, which opened in 1999, is capable of filling nitrogen, oxygen, propane, argon and HPG gases.

“He became our first outside specialist, and having him focus on that market was a big help,” says Martin. “He's still with us today, and he's very good at what he does, so he developed a rapport with customers in that market. And once he was able to bring some business in, we were helped by word of mouth and were able to build on that. Seven years ago, we brought in a second outside specialty gas specialist, so now we have two people who focus exclusively on this market.”

In 2002, Middlesex discovered another niche with nitrogen microbulk gas delivery technology, which found particular favor within the biotechnology and pharmaceutical markets. “Traditionally, in our market in Cambridge, space is tight, so bulk tanks can be very hard to put down, whether for practical or cosmetic reasons,” says Sales and Marketing Manager Ron Perry. “But microbulk has provided a great solution for our marketplace, and our employees have been able to design some pretty interesting combinations for situations such as when the cylinder and the application are on different floors. Every time a customer presents a new challenge, we work it out and say, 'If you need your gas supply at this location, we'll get it to you.'” Since the company introduced the microbulk program, it has installed more than 70 microbulk tanks in the field, and in 2006 Middlesex purchased a second microbulk delivery truck in response to the program's rapid growth.

In late 2006, Middlesex added another element to its specialty gas program with the formation of an in-house engineering team. “Previously, these employees were focused primarily on repairing welding machines, but we've redirected their efforts with a lot of training,” Martin explains. “Now we have three employees who devote most of their time to the microbulk installations, piping, manifolding and preventive maintenance program, so we have a turnkey package focused in this particular marketplace.”

Employees like Microbulk Service Technician Shane Poole are the lifeblood of Middlesex Gases & Technologies, ensuring the company's continued success with their dedication to teamwork.

The increased focus on the biotechnology and pharmaceutical fields has paid off for Middlesex Gases & Technologies. Since 1991, the company's sales have increased from $5 million to $13 million. Welding equipment, which used to comprise half of Middlesex's sales, now provides one-quarter of the company's sales, even as sales of welding equipment have continued to grow. The vast majority of the new growth has come from the specialty gas market.

Team Effort
Middlesex's expansion in the specialty gas market meant learning to adjust to the differences between the new market and its previous, heavily industrial focus. “This market is a lot more labor-intensive,” observes Martin. “In the old days, on the welding supply side, we'd pull up to a building, put the cylinders on the dock, swap the empties that were there, and off we'd go. Today, our customer may be a firm with a lab on the third floor, 100 yards down. From a service standpoint, the biotech industry is much more demanding. That was part of the learning curve, in addition to understanding the product and equipment.”

To gain the necessary product and equipment training, Middlesex turned to its vendors. “Our vendors have really stepped up to help us,” says Perry. “Training is ongoing for our salespeople and support team, and we take pride in that we put a lot of energy and time into making sure our people are skilled and knowledgeable.” When a new employee is hired, the company works with consultants to put together a chart outlining the training required to bring him or her up to speed.

Middlesex purchased a second microbulk delivery truck in 2006 to serve as a backup, so customers never have to worry about running out of product due to a problem with a delivery truck.

Today, Middlesex's knowledgeable staff includes 66 full-time employees, many of whom have been with the company for decades, and all of whom play a vital role in providing customers with the high level of service they've come to expect from Middlesex. The longevity of Middlesex's employees is a source of honor for the company, and those long-term employees feel a sense of pride in the company for which they work.

“This is a family-run business, and when you work here, you feel like part of a family,” says Perry, a 26-year Middlesex veteran. “I started out here delivering cylinders, and I was promoted from within. That's something the company still does, because we want to provide employees with new opportunities. We each have input, and at the end of the day, we all know we're contributing to the team.”

Martin stresses that the concept of “team” is one of the most important contributors to Middlesex Gases & Technologies' success. “Everybody in this company contributes in one way or another, from the outside salespeople knocking on doors and developing relationships, to the guys filling the tanks and making sure the tanks look good, to inside sales, billing and every other department. This is very much a team effort, and we've got a great team here.”

Embracing Technology
Another area in which the company has not been afraid to take new steps is technology. One of the newest and most popular services Middlesex provides is wireless telemetry, which allows customers to be completely hands-off regarding their gas supply, and which has proved a strong selling tool. “Once the tank is in the field, the telemetry unit calls us twice a day to let us know how much the customer is using and when they're going to need a delivery,” says Service Technician Shane Poole, who helps to coordinate Middlesex's microbulk program. “We look at the trackers online and determine whether a customer is going to need product that day or the next. The customers love it because they never have to touch the tanks, and they never have to worry about running out of product.”

Middlesex's specialty gas filling capabilities allow the company to provide high purity, research grade and custom blend gases to its customers.

Middlesex has harnessed the power of the Internet in other ways as well. In late February 2007, the company went live with a complete redesign of its Web site, www.middlesexgases.com. The site now allows customers to view their accounts and place orders online, providing additional flexibility and a faster transaction process.

“We've changed the look and feel of the Web site to be more in tune with the biotechnology and life sciences marketplace,” says Perry, who oversaw the redesign of the site. “We partnered with a company called CrystalVision out of Portsmouth, New Hampshire, which also created the Web site of the New Hampshire Biotechnology Council. It was a good fit for us because we're not a large enough distributor to have a whole IT group dedicated to the Web site, and they monitor the site for us and keep it up and fresh.”

Although biotechnology is at the forefront of the new Web site, the traditional welding supply market has a presence as well. The company recently launched a rental program for welding equipment which features prominently on the site, and this summer, Middlesex will introduce online ordering capabilities in part to combat the loss of margin resulting from end-users buying equipment more cheaply from other sources on the Internet.

Middlesex's online store will launch with between 100 and 150 items tailored for the welding supply market. “As we go forward, we'll make some things available online for the biotechnology market,” says Perry. “But for now, we're looking at home hobbyists, small shops and other people who are going online to pick up a small welder or an auto-darkening helmet. This opens a whole new market for us, geographically.”

Martin sees the online store as an opportunity to grow the company's industrial sales. “Over the last few years, most of our effort has been spent on the high-end gas side. But last year we decided it was time for us to do a bit more on the traditional welding supply side in order to change with the times.”

Keeping an Open Mind
The primary goals for Middlesex Gases & Technologies as it approaches its 60th year in business are to remain independent and maintain a growth rate of 10 to 15 percent per year. The company continues to expand its geographic reach. In May 2006, Middlesex opened a new branch store in Warwick, Rhode Island, adding to a Massachusetts footprint that already included its headquarters and fill plant in Everett, a second fill plant in Plainville, and two branch stores in Haverhill and Framingham.

The company continues to explore new technology and new areas of growth potential in its market. “There are new advances all the time in technology, particularly in biotechnology,” says Perry. “How is stem cell research going to play in our market going forward? How can Middlesex become involved in fuel cell research? What new companies will evolve from the research that continues to be spun off from the biotech facilities here? We need to be open-minded about everything that's around us and make sure we evaluate the potential and do our due diligence to make our company a part of that.”

Given the company's knowledgeable team, dedication to customer service, and proven ability to turn a calculated risk into an unqualified success, it doesn't take a scientist to conclude that Middlesex Gases & Technologies has all the elements of a distributorship with a bright future.