Sky Oxygen

Family-owned company embraces change.

Change is not a word with which welding and industrial, medical and specialty gases distributor Sky Oxygen is unfamiliar. Within less than a decade, the Carnegie, Pennsylvania-based company has moved its headquarters, undergone a change in leadership, begun operating two medical gas fill plants, and even changed its name. The last few years, in particular, have been hectic ones—but extremely rewarding. Through it all, the company has maintained its values as a family business. With the company growing by leaps and bounds, Sky Oxygen remains positioned to reach even greater heights.

A Family Affair

COMPANY SNAPSHOT
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President: Vincent Cirrincione III
Year Founded:
1973
Year Joined GAWDA:
1989
Headquarters:
Carnegie, Pennsylvania
Branch Locations:
Akron, Ohio; Erie, Pennsylvania
Employees:
42
Web Site:
www.sky-oxygen.com

The foundation for Sky Oxygen was laid in 1972 when Vincent Cirrincione Sr., the grandfather of current President Vincent Cirrincione III and Vice President Laurie Waller, was laid off from the Pittsburgh steel mill for which he repaired welding torches. Soon, though, the mill found itself in need of his expertise and began sending him torches to repair at his home. Cirrincione did the work in his garage. By 1973 he was picking up torch repair work from other local companies and decided it was time to incorporate. Thus, Vince’s Torch Repair—soon, Vince’s Gas & Welding Supply Co.—was born.

Over the next dozen years, the company expanded slowly. Vince Sr.’s sons, Denny and Vince Jr., began working with their father, and customers started asking about more than just torch repair, so the company began to distribute related equipment and supplies. As the business grew, the company moved three times—first from Vince Sr.’s garage to son Denny’s garage, then to a 1,500 square foot facility in the late 1970s, and then to another facility of approximately 6,000 square feet in 1986, where three years later the company began pumping oxygen and propane, for the first time dipping its toes in the medical gas market. During the same time period, the third generation joined the family business—Vincent Cirrincione III in 1987 and Laurie Waller in 1993. In 1988, founder Vince Cirrincione Sr. retired.

In 1998, Vince’s made another leap forward when it moved to its current 12,000 square foot facility and expanded its pumping operations to include an array of base gasesargon, carbon dioxide, nitrogen, oxygen and propane. Denny Cirrincione passed away in 1998, and two years later Vince Cirrincione Jr. retired. The torch, so to speak, passed to a new generation.

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A corporate rebranding effort included hiring a designer to create a new “Sky Oxygen” logo to use on literature, trucks and signage.

Under New Management
Neither President Vincent Cirrincione III nor Vice President Laurie Waller imagined when they started their careers that they would end up working for the family business—“It was considered the kiss of death,” says Cirrincione—let alone running it. He and his sister embarked on separate paths—he in sales, she in the corporate world. But after close to a decade, each decided separately to give the family business a shot, and both realized they’d found their niche.

“If we’d both joined this company straight out of high school or college, we wouldn’t have grown as much professionally or personally,” Cirrincione observes. “The experiences we’ve brought from outside have helped position the company to grow.”

The two were given a lot of latitude in the business even before their father retired in 2000, so the transition was a painless one. “Periods of transition can cause a lot of friction in families,” says Waller. “That’s very common in closely held businesses. So, knowing that, we’ve been extremely proactive in agreeing about how we split things in the company. We put a really high value on keeping the family relationship stronger than worrying about a little bit of money or power.” Waller and Cirrincione worked out plans for how they intended to split the business, and then brought their ideas to their accountants and attorneys, who helped them tailor their plans and customize all the necessary agreements.

The siblings work together “exceptionally well,” says Waller, due to their similar values and complementary skills. Cirrincione focuses on sales and finances, while Waller specializes in areas related to strategic planning, organizational and employee development, operations and legal issues. “But we consult on everything,” says Cirrincione. Waller also works with the GAWDA Government Affairs committee, helping to organize the industry’s battle against welding fume litigation.

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Sky Oxygen entered the medical gas market for the first time in 1989. Today, medical gases comprise 40 percent of the company’s sales.

One thing the two agreed on when they made the transition to leading Vince’s Gas & Welding Supply was a willingness to take calculated risks and seize opportunities in order to grow the company, even in directions not anticipated by their father, uncle and grandfather. It was a strategy that would pay off.

New Directions
The period immediately following Cirrincione and Waller’s succession in 2000 was a calm one, but things were about to get rockier. “For the first year, everything stayed about the same,” recalls Cirrincione. “But then 2001 came, and the economy took a downturn, so we weren’t feeling very confident.”

Cirrincione and Waller didn’t realize it, but the company’s 1989 expansion into the medical gas market was about to prove an even more fortuitous one than they’d already thought. It was Cirrincione who’d made the connection between the industrial oxygen the company already sold and the medical oxygen for which there was a growing market in the Pittsburgh area. The first account Vince’s Gas & Welding Supply signed was a sizeable one, which justified the expenditures to start filling medical oxygen. “An opportunity came past us, and we capitalized on it,” says Cirrincione. However, he and Waller admit, if the account had been smaller, the company might not have entered the market.

Since that time, the medical gas market has exploded, and today Sky Oxygen is riding the wave. “The medical market is very strong,” says Waller. “People are being diagnosed with respiratory ailments at an earlier age, and this region has very favorable demographics for medical oxygen, i.e., older people who smoked and worked in factories, coal mines and steel mills.” In fact, the Centers for Disease Control and Prevention report that Pittsburgh has the highest percentage of smokers among major cities in the Northeast.

As well as acting as a wholesaler to the home health care market, Sky Oxygen also tailors financing programs for select small to mid-sized home care companies that aren’t well capitalized, but which Sky Oxygen perceives as showing strong potential. “We offer lease-to-own programs or rent specialized equipment because the home care companies can’t afford to buy those assets when they’re trying to build up a patient base,” explains Cirrincione. “It can take us three to four years to recoup our investment with a customer, so we really have to feel confident that their company is going to last. As a result, we get a lot of long-term loyalty.”

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President Vincent Cirrincione III and Vice President Laurie Waller have presided over tremendous growth at Sky Oxygen, and the future looks just as bright.

In 2002, Cirrincione and Waller decided to expand the company’s medical gases footprint with the acquisition of a 6,000 square foot medical gas fill plant in Akron, Ohio, and in January 2006 the company began operating a new medical gas filling facility in Erie, Pennsylvania. The Akron and Erie locations are dedicated exclusively to the medical gas market, while the company’s Carnegie headquarters services both the medical gas market and the industrial market on which it was founded. Even given all of the company’s growth in the medical gas market, the industrial market continues to provide 60 percent of Sky Oxygen’s overall sales, and the company recently named a vice president of industrial sales, David Bloom.

“The opportunity to acquire the plant in Ohio came right around the same time the industrial market had just started to turn,” says Cirrincione. “Those two major events helped us turn the corner and positioned us well for the growth period that lay ahead. By the time the economy improved, we were ready to grow and hire people.” Within the last four years, the number of employees has increased from 15 to 42, and even more changes have taken place as a result of the company’s expansion in geography and employment.

A New Identity
One of the company’s most noticeable recent changes came about as a result of its growth in the medical gas market. The opening of the Akron fill plant forced Cirrincione and Waller to take a hard look at how the company would identify itself in the new market, over 100 miles removed from its Pittsburgh-area base. “It seemed awkward to export the name ‘Vince’s Gas & Welding Supply’ to a medical-only business in a market where nobody had ever heard of us,” says Waller.

She and Cirrincione “kicked around a million names,” but “Sky Oxygen” came from out of the blue. A friend of Cirrincione’s wore a shirt one day bearing the logo of Sky Bank, and the name struck a chord. He called Waller and proposed the name “Sky Oxygen,” and she agreed wholeheartedly. The Akron facility became Sky Oxygen, while the Carnegie location remained Vince’s.

When the company began scouting real estate in Erie for a new fill plant last year, they decided that location would open under the name Sky Oxygen as well. However, with the business growing by leaps and bounds, and the number of employees nearly tripling in a few short years, Cirrincione and Waller began to wonder if it was time for a company-wide change.

“Vince’s carries the local, hometown, nice-guy, can-do-a-good-job-for-you reputation,” says Cirrincione. “But we didn’t feel it was reflecting our true capabilities as a company.” Adds Waller, “We wanted to re-brand and reposition ourselves as a larger company—not larger than we are, but at least as large as we are. ‘Vince’s’ sounds very tiny and provincial.”

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Carl Clark, Operations Manager Carnegie

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Chris Holzworth, General Manager Carnegie

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Tony Priest, Supervisor Customer Service

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David Bloom, Vice President of Industrial Sales

The name change took effect August 31, 2005, and Cirrincione and Waller took care to get the word out that the name may have changed, but the company and its values had not. They hired a designer to create a new logo to use on their literature, trucks and signage, and they issued a press release to local publications and held an open house. “We mailed to our entire database a postcard announcing we were still the same family, still the same people they’d always known,” says Waller. “We really drove that message on everything.”

Training and Reorganizing
As the number of Sky Oxygen employees has grown, so too has the need for additional management, including General Managers Chris Holzworth in Carnegie and Troy Aiken in Akron and Erie. “We never had a general manager until two years ago,” says Cirrincione. “But having a strong general manager allows us as owners to be more strategic in planning. We can still stay involved in the day-to-day events, but not have to get involved in every level of planning.”

A major part of that strategizing has focused on people development and human resources issues. Says Waller, “We’ve learned like everybody else that fitting people into the right jobs and getting them the skills they need is critical while you’re growing.” Sky Oxygen is proud of its many long-tenured employees, a number of whom have been with the company for more than a decade, and some for over two decades. However, new managers and an expanding number of new employees have necessitated a great deal more investment in training programs, including both technical training and professional development.

“We had so much catching up to do on manager training, our first class was called ‘Transitions to Management,’” says Waller. “We had front-line people who were promoted out of the peer group and were still thinking like that. Since the initial transition level, we’ve gone all the way to personalized coaching, personality assessment and a customized inside sales training program.”

Basic professional training for key employees includes classes on how to give performance appraisals, how to increase performance and how to manage time. Every managerial employee also is required to go to a GAWDA professional program in addition to the internal training.

“It’s been expensive, but it’s worth it,” says Waller. “It’s brought everyone’s level of performance up. And I expect we’ll see the amount we spend on training decline in the next few years. We had to do a really big push to start.”

Strategies for the Future

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Vince's Gas & Welding Supply Co. got its start in founder Vincent Cirrincione Sr.'s garage. Today, Sky Oxygen operates out of three locations in Carnegie, Pennsylvania; Erie, Pennsylvania; and Akron, Ohio.

As the company moves forward, Cirrincione and Waller will continue to look for ways to grow the business by exploring new, related niches, such as the successful expansion to Akron and Erie. “We’re constantly evaluating new opportunities,” says Cirrincione. “We don’t want to overextend ourselves, but we are taking calculated steps.”

At present, the company is considering buying a business that does service work on the industrial side, but whether Sky Oxygen chooses to acquire it will depend on whether they can turn it into a profit center and a value-added service. “Most of the opportunities we look at, we don’t do,” he notes. “But if we explore enough of them, sooner or later we find good ones.”

One subject Sky Oxygen likely won’t have to address within the next few years is that of succession. “At this time, we’re the last leg of the succession plan,” says Cirrincione. “We have small children in grade school, and we’re in our early and mid-40s, so we have plenty of years left to see what happens with our children and the industry.”

In the coming three to five years, the extremely rapid growth the company has undergone in the last several years likely will slow down, but Waller and Cirrincione expect the growth they will see will be very good nonetheless. “Our goal is to become a strong regional player,” says Cirrincione, “whether the region happens to move a little more east, or a little more west, or a little more south.” Adds Waller, “We don’t know which direction we’ll go yet—if we’ll go toward Buffalo, or toward Columbus, or if we’ll just stay with a stronger density. It’s all based on opportunities.”

It’s obvious from the company’s rapid expansion over the last few years that Cirrincione and Waller are skilled at seizing the right opportunities at the right time. However, they stress that the company could never have achieved the success that it has without their family and their employees.

“We’ve given significant responsibility to our staff and they really have delivered. We can’t overstate that enough,” says Waller. “And we wouldn’t be here if my grandfather hadn’t gone through what he did in the early years when things were really challenging, and if my dad and my uncle hadn’t led the company so successfully.”

Says Cirrincione, “Our grandfather started the business, then Dad and Uncle Denny moved it to the second platform. When I came in, it came to another platform, and after Laurie came in, it came up again. It’s like a series of building blocks.”

And as Sky Oxygen continues to build its future in the industrial, medical and specialty gases industry, the sky truly is the limit.

Gases and Welding Distributors Association