Change agents

Amerisafe makes the transition from a safety product supplier to a full-service safety supplies and services company.

by Rich Vurva

In order to thrive in business today, companies require almost chameleon-like qualities. Successful organizations continually reinvent themselves to match their value proposition to an elusive marketplace.

Amerisafe is an example of one such company. In business since 1986, the Aurora, Ill.-based safety distributor has drastically changed its market focus, product and service mix. Under the direction of John Demos, a new president hired in late 2003, Amerisafe is undergoing its latest transformation from a product-centric distribution firm to a service-based safety specialist.

To understand how much the company has changed over the years, it’s helpful to know a little about where it began. Amerisafe is part of the Luse Companies, a construction firm serving the Chicago area and Northwest Indiana. Founded in 1923, the family-owned business provides insulation, asbestos, lead and mold abatement and environmental remediation contracting services.

The company first entered the distribution industry about 25 years ago when it purchased Parker Products, a distributor of insulation materials, which continued to provide insulation to its parent company. The Luse Companies also began to rely on Parker to keep abatement crews equipped with respirators, protective clothing, poly sheeting, disposal bags and other supplies.

Because of insurance liability concerns, however, Luse opened a separate safety distribution business in 1986 to supply PPE and other safety supplies. At first, Amerisafe focused exclusively on the abatement market, while Parker Products continued in insulation materials.

“Ninety percent of our business at Amerisafe was to environmental contractors. We developed a good reputation for having a large inventory of the commodities and equipment they use,” says Mike Strahler, vice president of sales and marketing.

By the early 1990s, anticipating that asbestos abatement jobs would diminish as the troublesome material disappeared from workplaces and homes, Amerisafe branched out into general safety supplies. It started selling to a wider range of customers, including general contractors, utilities and manufacturing facilities.

Despite the prevailing rumors that asbestos would soon disappear, removal remains an issue today, along with lead and, more recently, mold abatement concerns. But environmental contractors account for a much smaller percent of Amerisafe’s annual business today, reflecting the company’s success at diversifying its customer base.

By the mid 1990s, company owners recognized the need to broaden its scope even further. It acquired the training assets of a large engineering and consulting firm, which enabled Amerisafe to offer certification programs for asbestos abatement crews. The training effort eventually expanded into lead and mold abatement and now includes OSHA-mandated training and safety consulting services.

“We see the services arena as our biggest opportunity,” Strahler says.

In April of this year, Parker Products merged into Amerisafe, completing the company’s transition. It is now a distributor of a complete line of safety products and equipment, plus a wide range of mechanical, plumbing and thermal insulation supplies.

Selling services
Transitioning into a full-service provider of safety consulting and training is easier said than done. Although it acquired training capabilities six years ago, Strahler says Amerisafe only recently began to reap rewards.

“You can’t just hire a trainer or a safety consultant and hang out your shingle, have some salespeople call on customers and expect to be in this business. There’s a tremendous amount of behind-the-scenes work that needs to be done in course development, manual development and organizational and marketing activities,” he says.

It also requires finding the right mix of qualified trainers and safety consultants. Certified Safety Professional (CSP) Dan Strapon joined the firm in late 2003 as director of safety services. He previously owned an independent safety consulting firm, worked in corporate management in the environmental health and safety departments for Fortune 500 companies in the U.S., Canada and Latin America, and brings a wealth of knowledge and experience in occupational safety issues.

“We offer about 45 different training classes, most of which are OSHA mandated, along with more than 20 environmental courses,” Strapon says. “We also offer many classes in a computer-based format, online and in Spanish.” Amerisafe’s consultants can provide classroom or onsite training for construction or general industry and show customers how to change processes to incorporate safe practices into the workplace.

“We write safety manuals, we perform customized auditing programs and site inspection work,” he says.

The company can assist a customer’s existing health and safety staff or serve as an outsourced safety provider. Services include writing standard operating procedures that instruct employees how to perform a job safely, performing safety assessments to identify potential hazards, conducting insurance reviews and evaluating workers’ compensation claims to help customers pinpoint opportunities to lower insurance premiums.

Following a safety audit, rather than hand the customer an OSHA citation, Amerisafe makes recommendations that can help them avoid accidents that raise costs and could result in costly fines. The company takes the approach that safety doesn’t have to cost customers money, it can make them money.

A recent experience with a Chicago manufacturer demonstrates how. When a salesperson learned the company needed to replace some torn protective clothing used by its Hazardous Waste Operations Emergency Response (HAZWOPER) team, Strahler accompanied the salesperson on a site visit. While there, he asked the maintenance manager where the company stored its hazard response supplies.

The supplies were scattered throughout the facility, and some of the response kits were incomplete. Although the company had taken most of the precautions needed to respond to a chemical spill or other emergency, the team could benefit from better organization and planning.

After several discussions with multiple people inside the plant, Strahler eventually proposed conducting a complete safety audit for the facility. He also offered to assist the company by having Amerisafe conduct its annual emergency response team training.

“We ended up training their teams and helping them reorganize how they stored materials. Then we did some OSHA 10-hour courses for plant employees, evaluated all of their safety products and conducted a simulated chemical spill to test the team’s response,” he says.

All of the supplies the HAZWOPER team might need to respond to a chemical spill or other incident are now stored closer to areas where mishaps could occur, clearly labeled and fit-tested for each team member. With Amerisafe’s assistance, the company lowered its OSHA recordable incident rate in the first year by more than 50 percent. This year, the company anticipates another 50 percent reduction and, by continuing to work closely with Amerisafe, plans to continue the downward trend.

The story illustrates the difference that a full-service safety specialty distributor can make compared to a company that only sells safety products.

“Customers aren’t necessarily interested in your product, they’re interested in what your product is going to do for them,” says Demos. “It’s the difference between taking a catalog and thumbing through it vs. finding out what a company is trying to accomplish and learning how we can help them achieve their goals.”

Taking safety to the streets
When he became president less than a year ago, Demos injected new life into the company. He simplified the sales compensation plan (salespeople receive a salary and can earn quarterly bonuses for achieving clearly defined goals), hired additional salespeople and boosted the amount of training salespeople receive. The company also unveiled a new logo and re-launched its Web site to make it more informative and user friendly.

“We’re trying to gain market share by having a more aggressive sales and marketing approach. At the same time, there’s a danger in any business like this becoming commoditized. One way to guard against that happening is to be better at understanding people’s businesses and being a better resource for our customers,” says Demos.

Four full-time outside salespeople focus primarily on product sales, two field salespeople focus on sales in Indiana, and a third specializes in calling on utility customers. Amerisafe recently hired another salesperson to focus exclusively on selling training and safety consulting services and plans to hire an additional product salesperson devoted to new business development.

“We’re coming off of a difficult economy, but rather than thinking about cost-cutting measures, we’re out hiring salespeople and looking for new markets to sell into and new opportunities,” says Strahler.

This article originally appeared in the July/August 2004 issue of Progressive Distributor. Copyright 2004.

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