Transportation, Distribution & Logistics

Distributor hits 2nd century in growth mode: Indiana Oxygen uses Ohio outlet, Internet to expand

June 12, 2006

The Indiana Oxygen Co. building is highly visible to motorists traveling Interstate 465 on the northwest side, but the company's forte isn't as widely known.

Founded in 1915, Indiana Oxygen is the oldest gas and welding supplier in the United States. But to the surprise of many, the medical relationship the name implies hardly exists.

Despite the confusion, the company's flame burns bright, as annual revenue this year will top $30 million. Part of Indiana Oxygen's recent growth stems from its foray into southwestern Ohio, where a 10,000-square-foot retail outlet near Cincinnati will open later this month. The location is twice the size of the original space the company has occupied there since 1998.

Indiana Oxygen entered the Ohio market after purchasing a welding supplier in Lawrenceburg in 1995 and since has established a solid footprint in the region.

"It was a situation where we were able to come in, and before we knew it, build the business up to $2 million [in revenue]," company President Wally Brant, 56, said. "We may have been relatively new to the area, but we had been in business for [many years]. That seemed to satisfy the concerns whether we would be there very long or not."

With its operation to the east on solid ground, Indiana Oxygen executives are looking in the other direction. Unable to provide details yet, Brant said the company will expand to Evansville and Illinois within the year. It now has 90 employees in nine locations, eight of which are in Indiana.

The Internet has also spurred business. Indiana Oxygen has used the Web to grow annual revenue 30 percent, Brant said.

Company roots in cars

The roots of the third-generation business can be traced to the auto industry. Brant's grandfather, Walter, and his grandfather's brother, John, operated a luxury car dealership in downtown Indianapolis.

In 1911, the year of the inaugural Indianapolis 500, the men sponsored two cars, one of which finished second out of 40. When auto sales dropped during World War I, they started a gas distribution business using the then-progressive method of making oxygen and hydrogen gases from the electrolytic separation of water molecules.

Their link to the racing world continued, though. Indiana Oxygen was the first to use compressed air, which replaced the manual pump, in the 1920s to fill tires. Later, the company pioneered the use of nitrogen for pressurized refueling. The method of gassing up was eliminated in 1964, but Indiana Oxygen still maintains a garage at the track to provide gases and welding services to race teams.

Today, the company mostly provides oxygen, nitrogen, helium and argon to industry and laboratories. The company also owns a plant in Beech Grove that manufactures acetylene.

Indiana Oxygen supplies clients with gases through a process in which the elements are transported to its Indianapolis headquarters in liquid form. Most is pumped into huge storage tanks, vaporized and converted to gas. The finished products are repackaged in cylinders that are shipped to customers and other company locations.

Within the next decade, the Cincinnati branch should begin producing its own products instead of having them transported from Indianapolis, Brant said. The cost of fuel, the growth of the location and the logistics involved are prompting executives to make the change.

The 31,000-square-foot Indianapolis location is the only one in the company with both a production facility and retail store. The outlying branches are mainly stores where customers can pick up gases and shop for welding supplies. The stores sell everything from welding helmets and gloves to high-tech welders that might cost as much as $15,000.

Next generation nearing

Gases in high-tech applications are beginning to drive industry growth, said Avery Seaman Jr., president of the Philadelphia-based Gases and Welding Distributors Association.

Nitrogen, for example, is used for filling light bulbs and in thermometers. But the liquid form is used as a coolant to preserve bodies and reproductive cells, and to store biological samples.

"New uses of gases are being developed every day," said Seaman, who operates Corp Brothers Inc. in Providence, R.I. "While the welding end is holding its own, the development of our business is definitely in the specialty-gas area."

Indiana Oxygen's corporate clients include Eli Lilly and Co., which needs nitrogen to purify air when producing pharmaceuticals. Nitrogen makes up fourfifths of the earth's atmosphere.

The Indianapolis location of New Jersey-based BOC Gases has supplied Indiana Oxygen since 2002. Gary Halter, a BOC distributor sales manager who oversees a four-state area, described Indiana Oxygen as a "professional" organization.

Wally Brant graduated from Purdue University in 1971 and volunteered for officer training school in the U.S. Air Force. He stayed for seven years and originally planned to attend law school. But when his father, Robert, had an offer to sell the business, he queried his son whether he had any interest in taking over. He didn't, but thought he owed it to his dad. Brant said he has never regretted his decision.

Indiana Oxygen recently lost its patriarch, when Robert died May 29 at age 89. He began work at the family business in 1937 as a truck driver and ultimately ascended to president.

He retired in 1984 but remained active in operations until suffering a stroke in 1998. He held the title of chairman of the board until his death.

The next generation of Brants is poised to assume leadership, however. Brant's daughter, who is an attorney, and son, who just graduated from Indiana University, should join the company within three years.

"My plan is to have two solid years of working with them," Brant said, "and then I will walk out the door."
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