CENTRAL

As it has the past two years, the Central region of the country accounted for the most survey results. And while the results in 2021 and 2022 were strikingly similar (8.37% growth in 2021 and 8.9% growth in 2022), this year sees a marked shift in optimism, with the Central Region being the least optimistic region surveyed, clocking in at 5.83% expected growth.

` Gary Halter, President INDIANA OXYGEN

“The past three or four years, we have budgeted for single-digit growth, but we’ve been surprised each of those years by growing our business 10% or more,” says Indiana Oxygen President Gary Halter. “Based on past growth and a strong list of prospects, we are looking at 8% growth in 2023.” He continues, “The enormous rise in energy costs have led to very large cost increases from our gas suppliers. The economy and the health of our customers will obviously have an impact as well. Educating our customers about this situation, in hopes of passing this cost along, while preserving our trust and credibility with them, will be the number one challenge as we head into 2023. I don’t feel that our customer service will be at risk. Product supply with helium and CO2 is a concern as well.” He concludes, “Recently, a well-respected independent adjacent to our traditional market sold to one of the top majors. As luck would have it, those customers had been weened for decades on the ability to transact with the owners. When the owners jumped ship - the day they turned over the keys to the new owner - a surprising number of customers went looking for a new independent with which to do their gas business. We have started two new stores in their back yard to accommodate those customers.” As it has always done, Indiana Oxygen will continue to expand its offerings to improve its value proposition, including its new equipment repair division.

` Eric Wood, COO O.E. MEYER CO.

“Our customers’ needs to purchase capital equipment and welding and cutting automation will dictate the percentage growth in 2023,” says O.E. Meyer COO Eric Wood. “We are fortunate to have many large capital equipment projects quoted with our customers with high probability of closing in 2023.” The company has made significant investments toward improvements to its e-commerce platform, its website and SEO, which have helped drive business since COVID. In 2023, O.E. Meyer will purchase six acres to relocate and expand of its locations to a more desirable area that will not only improve customer experience, but also give its current future employees a better area to work in. Wood concludes, “We have made investments in infrastructure and with new employee owners to strengthen and expand into new markets and capitalize on opportunities and market share in markets already established.”

` Joe Winkle, Owner WELDSTAR

Weldstar expects to see a 10% growth in 2023, even in the face of a possible recession, according to Owner Joe Winkle

He notes that, “We have embraced technology. We believe the labor market will be outpaced by output. Thus, we will need to fill that gap by being more productive. The only way to do that is through innovation and technology.” He continues, “The two disruptors, like most areas, are the supply chain disruptions and inflation. We believe that companies who planned for such an environment will have advantages moving forward. Our region is predominately manufacturing in many forms. We believe manufacturing will remain strong for the first half of 2023.” In recent years, Weldstar has opened offices in three new locations, which will contribute to its long-term growth strategies.

` Scott Myran, President MISSISSIPPI WELDERS SUPPLY COMPANY

MWSCO anticipates a growth of 5% in 2023 “if conditions slip a bit,” but could see growth of 8-10% “if we see favorable changes in employment, interest rates, and energy,” says President Scott Myran. “MWSCO is a stakeholder in Absolute Air. After delays in launching the plant in 2022, we know we'll be producing LIN, LOX, LAR in 2023, giving us much greater control of a large segment of our supply chain,” he says. “We're always ready to expand to underserved markets. Market research never ceases, when opportunities for expansion are ready for primetime, we've proven multiple times we can go to market quickly and effectively.” The company opened a new branch in Appleton, Wisconsin, in 2022, a market that had been on its radar for several years. That new branch will be a long-term growth driver for MWSCO.

` Brad Davis, General Manager CENTRAL OHIO WELDING, INC.

“We expect our company to grow between 7-10% in 2023,” says Central Ohio Welding General Manager Brad Davis “Most metro areas in Ohio, including the ones we service, are seeing steady growth from manufacturers adjusting their supply chains and investing in automation.” Central Ohio has multiple large construction projects that are starting in 2023 related to Semiconductors and Green Energy. These projects, as well as considerable investments in manufacturing throughout Ohio give the company confidence that this will still be a decent year in spite of forecasts for a potential downturn. “Our biggest issue in Ohio is that we do not have enough labor to fill the Welding, Machining, and Driving positions within the state,” Davis says. “At the same time, we have a lot of companies that would like to expand production. This affects growth considerably.” He concludes, “The biggest changes we have made the past three years are how we rate our suppliers and how we pick our target customers. In our markets, the ways we used to business are going away so quickly we need to have the right partners at both ends.”

` John D’Amaro, CFO ILMO PRODUCTS COMPANY

In the face of supply chain issues, gas shortages, and the ongoing labor challenges, ILMO Products company still anticipates growth of 7%- 10% in 2023, according to CFO John D’Amaro. The company projects some market segments will be up while others will be down. “While not a new market, we are seeing some growth in the propane segment of our business, driven by geographic expansion,” D’Amaro says. 2023 is shaping up to be an exciting year for ILMO, as the distributor celebrates its 110th anniversary this year.

` Jon Berger, President BERGER FARM & WELDING SUPPLY

Two large customers signed contracts in December 2022 that really set the tone for a strong year for Berger Farm & Welding Supply. President Jon Berger projects a robust 20% increase for Berger this year, even as the industry itself will remain flat. He notes, “stocking levels have had to increase due to supply shortages.” The RV and trailer industry, one that Berger does a lot of business in, will see a down year compared to the last two years, according to Berger. Even with that factored in, 2023 still projects to be a strong year for the company.

` Robert Kurvers, VP of Sales and Marketing TOLL COMPANY

Robert Kurvers , VP of Sales and Marketing for Toll Company, expects sales to be down in 2023, compared to 2022. “Large rare gas orders will be limited, as will expensive helium purchases,” Kurvers says. He notes that Toll continues to target markets for its welding cobots. Toll is also part of the cooperative that opened Absolute Air in 2023, which will allow the company to target bulk gas markets. During COVID, Toll enhanced its websites and added third-party phone and email campaigns to target prospects to gain engagements, set up appointments, and gather information, efforts which will continue to pay off this year.

2023 BUSINESS FORECAST DISTRIBUTOR MEMBERS

South

Last year, the South was overwhelmingly the most optimistic region of the country, with an expected 11.74% growth. This year, responses weren’t quite as optimistic, but the region still clocked in as the second most optimistic, with a projected growth of 7.57% in 2023.

` Allen Jezouit, Vice President, Product Management & Digital Marketing

Meritus Gas Partners

“Sales will be up due to price increases, offset by modest volume declines later in the year,” predicts Meritus Gas Partners Vice President of Product Management & Digital Marketing Allen Jezouit. “We are paying close attention to helium and CO2 sourcing costs. CO2 pricing may be drastically impacted by the increase in the 45Q tax credits in the Inflation Reduction Act and the proliferation of sequestration. Helium Shortage 4.0 remains underway, although the supply situation is currently stable. The labor market remains tight, especially for truck drivers.” The company’s primary business model is to expand through target acquisitions, which will continue in 2023. Concludes Jezouit, “Demand will taper off later in the year as the forecast recession takes hold. Timing of that drop-off is difficult to predict as current demand remains strong.”

` John Hill, President WILLARD C. STARCHER, INC.

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` Robert McNeely, Purchasing Agent SHAW OXYGEN

Shaw Oxygen continues its search to add reliable vendors to combat the ongoing inconsistences in the supply chain, according to Purchasing Agent Robert McNeely . The company also continues to raise costs when necessary, while simultaneously looking for ways to cut costs. All of this will help contribute to a projected 5% growth in 2023. Says McNeely, “We have added new product lines. And, more importantly, we are being more attentive to customer demands by providing concierge service, setting us apart from our competition. We are well-versed in explaining our product lines and why it is beneficial to buy from us.” The company has recently entered CO2 sales, which it anticipates will be a growth driver going forward. Barring potential political instability, 2023 projects to be a year of modest growth for Shaw.

` David Rimes, Owner LAKE WELDING SUPPLIES

Lake Welding Supplies has increased its inventory, which will help contribute to an expected 10% growth in 2023. As others have noted, “inflation is really hurting our bottom line,” says Owner David Rimes. Like others in the South, farming is a primary industry for Lake Welding Supplies and will be a large determinant on if the company is able to realize its projected growth in 2023. Even in the face of rampant inflation, Rimes anticipates the gases and welding industry will see a positive year in 2023.

` Nathan Stringer, President B&R INDUSTRIAL SUPPLY, INC.

An increase in inventory and additional suppliers will help B&R Industrial Supply, Inc. realize a 10-15% growth in 2023, even as supply chain issues persist. President Nathan Stringer anticipates that manufacturing will help the company realize that potential. “We feel that all industry will be up in 2023,” Stringer says. He notes that B&R added a new location in November 2022 and that sales will increase over the course of the year this year. Overall, this will be a year of growth for the gases and welding industry.

` Revell Supply Group

Revell Supply Group anticipates a small growth of 3% in 2023, even as the company anticipates the overall industry to be down. “A few customers will have big jobs next year, otherwise I believe we would be down slightly,” the company says. The company’s biggest industries are construction and light industry, which it believes will be softening or down in 2023. It does plan for new product launches and an additional outside salesperson, “in a market that we currently serve but do not solicit,” both of which will be long-term growth drivers for Revell. The company has also expanded its safety categories and added in-house customization of safety gear in recent years.

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` Larry Simpson, President WELDERS SUPPLY & GASES OF LOUISVILLE

A combination of price increase pass throughs and new revenue generated from organic growth and new logos will lead to a 6.5% growth in 2023 for Welders Supply & Gases of Louisville. The company is celebrating its 75th anniversary this year and has plans to launch a new 43,000 sq.

ft. fill plant, according to President Larry Simpson. Through COVID, Welders Supply began offering multi-channel options for customers to continue to do business with them, including e-commerce and online chats, in addition to its phone and in-person service. “Our newest technology and automation have provided quality and efficiency controls and given us more control over our supply and deliveries,” says Simpson.

West

Coming off a year where it was the second most optimistic region in the country in 2022, combining to forecast 9.5% growth, the West continues to exude confidence in 2023. GAWDA members in the Western Region forecast a cumulative 7.1% growth in 2023.

` Benjamin Bisconer, CEO

Complete Welders Supply

Complete Welders Supply anticipates growth of 5-8% in 2023, assuming a stable availability of bulk gases, according to CEO Benjamin Bisconer . “The continual shortages of CO2 in our region have been disruptive and are expected to continue through 2023,” he says. “In California, the state’s policies against the oil industry and manufacturing in general will continue to create challenges for us.” Still, the company has positioned itself in a way that it relies less on distribution from its manufacturers and has been able to bring that capability in-house, which has helped promote growth even in a projected level year for the industry.

` Dave Burnett, President DJB GAS SERVICES, INC.

“Uncertainty of the economy, labor shortages, and energy prices,” are three of the factors that continue to impact the economy in 2023, according to DJB Gas Services, Inc. President Dave Burnett. Still, the company anticipates 3-5% growth in the new year. Burnett feels that the Western region of the country should fare better than the rest of the country during an anticipated slowdown. That slowdown leads Burnett to predict a level year for the industry this year.

` Stacy Lewis Hayes, CEO

VERN LEWIS WELDING SUPPLY, INC.

An uncertain economy combined with continued inflation leads Vern Lewis Welding Supply, Inc. CEO Stacy Lewis Hayes to project mild 1-3% growth for 2023. This is in line with her expectations of a level year for the industry as a whole. Supply Chain issues that have cropped up post-COVID will continue throughout the year, continuing to temper any growth opportunities that might exist.

` Joshua Blas, Sales Manager

CALIFORNIA TOOL & WELDING SUPPLY

California Tool & Welding Supply will see an increase in sales in 2023, thanks primarily to steps it has taken to provide its customers with a strong online presence, says Sales Manager Joshua Blas. As others have noted, the CO 2 market continues to be an issue. CTWS recently entered the Bulk CO2 market. CO2 won’t be the only gas supply issue posing problems in 2023, according to Blas. Helium, argon and CO2 all are difficult and expensive to procure and will impact the industry in 2023 if they persist all year.

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