Growing by Scratch-Starts, IT and Now, Acquisitions
By Charles McChesney
It’s more than a thousand miles to either ocean from Winona, Minn., but for Brad Peterson, lessons learned in the Navy work well on dry land. In 1991, after an 8-year career as an active-duty officer, he made the choice to come home and apply what he learned at sea about authority and responsibility to a new career at Mississippi Welders Supply Company, Inc., where he joined his father, Donald Peterson, in the business.
There were 22 people in four stores working for the company at that time, and all of them reported to his father. Don was a Navy reservist and a county commissioner, and was serving on state boards at the time, all while running the stores. Consequently, Don was quick to give son Brad new responsibility at Mississippi Welders.
“I had 22 people asking me questions,” Brad says of his days moving up the ladder at the business. He quickly delegated authority to others. It worked and the company grew. Still, Brad acknowledges, “as we kept growing, I’d look around and see 15 people at a meeting.” His experience told him he needed to delegate more authority to cut down the number of direct reports.
“That’s been the pattern for 25 years,” he says. Every time I look up and say, ‘I’m not getting done what I need to get done,’ it’s time to put somebody in place who can do these things and I can go on to bigger, more strategic things.” Across 25 years, that delegating has paid off as Mississippi Welders has grown to 11 stores with 160 employees and annual revenues of $50 million.
Seven New Branches
The expansion — seven branches in 25 years — was steady, concentrated and involved no acquisitions, the younger Peterson explains. The company grew with scratch starts in 1996 in Decorah, Iowa; in 2000 in Hudson, Wis.; in 2004 in Marshfield, Wis.; in 2006 in Altoona, Wis.; in 2008 in Rothschild, Wis., in 2011 in Mankato, Minn. and in 2014 by adding an operation in Madison, Wis.
Every store is within a day’s roundtrip of the Winona fill plant, where Mississippi Welders fills everything from welding gases to medical gases to specialized gases for use in high-tech manufacturing. The idea is to be able to load up a truck, make deliveries and have the driver back home within the DOT-hour limit, Brad explains. “About four-hours distance from the fill plant is doable,” he says.
A New Course
Now, Brad is looking at setting a new course for Mississippi Welders. After decades of building from scratch, he is looking to acquire other distributors. “We’ve done so many scratch starts it’s time to do something different,” he adds.
That focus is why in 2014, he delegated the position of president to long-time employee Scott Myran and revised his role to chairman and chief acquisition officer. He says he thought long and hard, and even considered going outside the company, before deciding Myran, a 28-year-year veteran with the company who started as a route driver and moved up, was the right person. “I felt he had the leadership and management skills necessary to move the company forward and free my time for larger and more strategic issues.”
Brad has nothing but praise for Myran, whom he calls, “very organized, very good at what he does.” Even as difficulty in the oil and gas industry has negatively affected sales, Myran has led the company to better efficiencies and higher gross margins. “That tells me we’re making progress,” Brad says.
In his Navy days, Brad worked on destroyers and aboard the aircraft carrier U.S.S. Dwight D. Eisenhower. He was trained on nuclear reactors, rising to be the start-up officer for nuclear plants — technical work that requires training and adherence to approved procedures. The experience gave him a clear concept of good management, he believes. “You want to encourage initiative; you want to provide general guidance and you want to very rarely and sparingly give a micro-managed rudder order. You don’t want to be the admiral in the Pentagon telling the submarine, ‘right 20-degrees rudder, ahead two-thirds,’” he says.
“You need to provide your intent, your guidelines, your objective, your goal and let people at it,” he adds. “Because that’s where the ingenuity, the ideas, the initiatives comes from: the deck plates. That’s what we used to say in the Navy, it comes up from the deck plates.”
d has driven its technical abilities, according to Chairman Peterson. About 15 years ago, the company developed its own laptop application for route salespeople, something Brad calls the most advanced application of its type at the time. A second in-house IT project allows quick visual checks on bulk tank levels for tanks in the field. Another project developed internally started as an in-and-out board that let everyone see, by computer, who was in the office. That has evolved into a program that allows workers to punch in, to schedule vacations and to see not just who’s in, but where they can be found. Executing the projects in-house allowed Mississippi Welders to achieve precisely what it wanted with the programs, according to Brad.
ad Peterson has sought advice and ideas from fellow GAWDA members and others. He found encouragement and one consistent message: “You have to work at it. You have to water the garden, tend the garden and hope someday to harvest the crop,” he says. “I had to devote myself to this.”
So far, Mississippi Welders has made two acquisitions, both one-person operations providing CO2 to restaurants and bars. There is no timeline and certainly no deadline for making the next acquisition, according to Brad. While looking to add businesses that are contiguous to Mississippi Welders’ current footprint, the company also is looking a little farther afield. However, Mississippi Welders isn’t depending on acquisitions alone to drive growth, according to Brad. The company is looking to expand its gas business from the current 30 percent of total sales. There have been some strategic hires in pursuit of that goal, and gas sales are a management focus, he says. The company has also added skilled personnel to its cryogenic gases operations.
Large as it has grown, Mississippi Welders remains a family business. Brad’s brother, Jeff, worked in the company for a time while also serving in the Navy Reserve. For the past six years, though, Jeff has been away on active duty in the Navy. Their sister Jane, an IT professional who had a career as a consultant, came to work for the company in 2015. And their father, Don, 82, is plenty active (“He still changes his own oil,” says Brad) and remains very interested in the business. Don serves as Mississippi Welders’ secretary and chairman emeritus.
Like his father before him, Brad Peterson has other interests to pursue. After his Navy active duty ended, he spent another 22 years in the Navy Reserve. He is a board member for the Independent Welding Distributors Cooperative and, at the 2016 Annual Convention, was elected first vice president of the Gases and Welding Distributor’s Association, a step that lines him up to become GAWDA’s 2018-2019 president.
Brad Peterson is optimistic about the gases and welding field. “I think the industry will enjoy continued growth as new and different applications for gases are found,” he conveys. While technology presents certain challenges and new opportunities to distributors, Peterson still believes the business at its core is all based on “the basic idea is putting gas in a cylinder. At the end of the day, you’ve still got to deliver gases to people.”