Gaining ground

Jim Bowman joined Rexarc International, Inc. about three years ago to run the business on a day-to-day basis. The company’s ambition is to be a global leader in compressed gas generation and distribution equipment, and Bowman is already three years into a five year plan that he helped put into place to optimize the business and its performance.

A large part of Rexarc’s international business involves designing and supplying acetylene plants, and spare parts to support its customers in the acetylene plant business. The company also supplies industrial gas distribution equipment and plant parts in the U.S., with plans to expand industrial gas distribution equipment sales globally.
“We have several projects going on in North America including one in the western part of the U.S., Canada, and a certified pre-owned Rexarc plant going into Mexico,” Bowman says. Another project in Suriname is due to go online shortly, and a new order has just come in for a new plant in South America.

“The Middle East maintains being a strong market for us both in terms of our acetylene plants as well as our industrial gas distribution equipment, as the Middle East market continues to want high quality, safe, and effective products,” Bowman adds.

Manufacturing hub
Rexarc’s 60,000 square foot facility in Ohio is the hub where the company engineers its acetylene generators and manifold systems. “We do light assembly for our apparatus, which can include specialty gas regulators and manifolds,” says Bowman, “We also do heavy fabrication and assembly, which is putting together these large plant projects. Our capital equipment projects range in size from $100,000 USD to $1,000,000 USD, with our average plant order being about $300,000 USD. We have been able to secure a multitude of plant orders in 2011 that will have us selling, shipping, and servicing these plants and equipment in the years to come in all four corners of the globe.”

Cultural shift
Bowman came on board keen to make enhancements to the company’s strong values and culture, a project which he says is paying dividends: “Over the last three years we have moved the culture of the business to a stronger team focus,” he explains. “We’re working together on five key metrics: revenue per employee hour; quality; on-time deliveries; operating profit; and inventory turnover. Together these provide a scoreboard for benchmarking, and employees are rewarded on a monthly basis for reaching key targets. As a result, the Rexarc team is coming together and has become more effective and efficient, enabling us to be more deliberate and proactive in our business going forward.”

Rexarc is focused on solution centered product designs, working with its customers and business partners on supply chain management and technical support. The team culture is contributing significantly in this area. Bowman cites a current collaboration with a Fortune 500 company to develop an application solution in the alternative energy sector and another in hydrogen fuel technology, where the benefits of effective teamwork have really paid off for all parties.

Custom designed and made-to-order items comprise about 80% of Rexarc’s business, with equipment designed to match a customer’s specifications for gas delivery including flow volumes, purity levels, and delivery pressures. Rexarc also has a number of catalogs for off-the-peg items, which can be viewed on its website as well as on its on-line marketplace (www.rexarc.com).

New product development will be a key area of focus moving into next year, not only in Rexarc’s specialty gas line that is up significantly, but in its industrial gas distribution line that is growing well internationally. The company continues to recruit and train additional senior engineering talent to strengthen this area of the business.

Economic balancing act
“Rexarc ‘s markets are well diversified, as we have shipped to over 41 countries in the past year,” Bowman says. “While some economies are struggling, other economies are growing and that helps balance our activities from a diversification standpoint.” The fact that the company has strong and growing sales in emerging markets, such as Brazil, is very helpful in this respect. “Our U.S. and North American sales have grown this past year and I believe that the manufacturing sector has become more settled. People in the U.S. may still be worried about what the stock market will be doing, and maybe what the tax structure and the debt levels might become in the future, causing some uncertainty, but I think there is some movement towards a level of optimism.” Bowman adds. “The uncertainties that are out there have affected us a little, but we are seeing some renewed investment into infrastructure. Activities are moving more positively forward making things even more hopeful.”
Looking into the future, Rexarc continues to focus on its plan to double growth, which currently stands at approximately 15% CAGR. This will happen in several different phases. “We are not only looking to penetrate markets in key growth areas, but to also bring customers new solution centered products on the development side,” Bowman says.

He concludes that Rexarc’s people are the company’s main asset. “We’ve really done a lot of training over the past year that focused on our key processes. That’s helping us to become more efficient. That along with our new product design process will continue to be our main focus for the next couple of years.”