Norco Inc.

Reinvestment drives growth at nation’s largest independent distributor.

After 17 years as a rep and a regional manager for Union Carbide’s Linde division, Larry Kissler sought an opportunity to break into the distribution side of the industry. His opportunity came in 1968 in the form of Norco, a small welding supply spin-off of the Nordling Auto Parts Company. Begun 20 years earlier in 1948 by David Nordling, Norco had branches in Boise and Twin Falls, Idaho. It was exactly the kind of operation Kissler was looking for.


Norco logo

CEO: Jim Kissler
President: Ned Pontious
Year Founded: 1948
Year Joined GAWDA: 1948
Headquarters: Boise, Idaho
Branches: 58 in Idaho, Montana, Nevada, Oregon, Utah, Washington and Wyoming
Employees: 900
2011 Sales: $225 million
Major Markets Served: Agriculture, Coal Mining, Gold Mining, Home Care, Medical, Natural Gas, Oil, Safety

The Kissler family was leaving behind Boston, Massachusetts, and heading for Boise, Idaho. Jim Kissler, in eighth grade at the time of the move, got jeans and bought a motorcycle. Larry Kissler got a distributorship. The future was wide open.

Defining Norco
When Larry Kissler took over the business, Norco had 15 employees and was bringing in around $600,000 in sales annually. One of the first employees he hired was a man named Dan Steele, whose ambition caught the attention of Norco’s new owner and quickly propelled him through the company ranks. Steele’s hard work and charisma gave him a magnetic quality that attracted both customers and employees.

Together, Larry Kissler and Dan Steele put their stamp on the Norco business. “They were like the Lone Ranger and Tonto,” says Jim Kissler, “and they had fun growing the business.” Under the watch of Kissler and Steele, Norco gained a reputation for quality service that continues to define the company to this day. To illustrate their service-based philosophy, Kissler and Steele placed the customer at the head of Norco’s organizational chart. Kissler was a firm believer that “the customer provides our paychecks.”

As Norco became more profitable, Kissler aggressively reinvested in the business. In 1974, with the money earned from the stores in Boise and Twin Falls, Norco purchased two more branches in Missoula and Kalispell, Montana. Stores in Oregon followed in 1981. Norco bought businesses every two to five years and grew into all the surrounding states. Says Jim Kissler, Norco CEO, “Not only did Dad want to be the largest, he also wanted to be the most profitable.” With every acquisition, Larry Kissler instilled Norco’s culture of working smarter, not harder, and found ways for the stores to operate more efficiently.

Norco’s management team gathers at a recent company retreat.

Norco’s management team gathers at a recent company retreat.

“Find a Need and Fill It”
Like many GAWDA members, Norco supplies the medical industry with gases; but unlike the typical distributor, a large portion of the company’s sales come from renting durable medical equipment, including beds and power wheelchairs. In all, 40 percent of the company’s sales are generated from the medical side of the business, with the remainder split between welding and safety products that make up Norco’s industrial division.

“In the early days of Norco, we had the cylinder gas business in dentists’ offices and home settings,” says Jim Kissler. “Dad had a philosophy of ‘find a need and fill it.’ When we were in the houses delivering oxygen, we saw that customers were renting equipment like wheelchairs, beds, walkers and commodes.” Norco saw an opportunity for growth and invested in new product lines. More recently, the company identified yet another need to fill in the home care business, and responded by adding CPAP and BiPAP equipment to its offerings to better serve patients with breathing disorders and sleep apnea.

Norco CEO Jim Kissler

Led by CEO Jim Kissler, Norco is the largest independent welding supply and gases distributorship in the United States, a business that has been in his family since 1968.

Over time, Kissler explains, many welding supply businesses became discouraged and dropped out of the medical business. “It can be a difficult business. Collections and billing are complicated. You need respiratory therapists, and you have to be on-call 24 hours a day. There are idiosyncrasies when dealing with an older population that is much different from industrial customers.” Finding respiratory therapists can be especially challenging for a company like Norco, which asks its therapists to double as clinicians and salespeople. “It’s a rare breed of respiratory therapist who can see clients and also talk to physicians as a salesperson and a representative of Norco. That’s our niche.”

With medical sales accounting for two-fifths of the company’s business, about half of Norco’s 900 employees work in the medical division. Kissler explains that providing medical supplies is highly labor intensive compared to the industrial side of the business. “It’s a more profitable product line, but the operating costs are much higher,” he says. “By the time we get the product delivered and the payment collected, the bottom line is about the same.”

Maintaining profitable margins is no easy task, either. Reductions in Medicare and Medicaid reimbursement—combined with the introduction of competitive bidding within the last decade—have cut into margins for all medical providers. Unlike the welding supply business, Norco President Ned Pontious explains, where a company can raise its prices to offset increased costs, medical supply providers are at the mercy of the government. “Even when reimbursement goes down, we still have to balance rising fuel costs and wages,” he says. “For us, that just means we have to find ways to operate smarter and at a lower cost.”

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