Special Report: After the flood

-- Industrial Distribution, 6/25/2008 6:38:00 AM

Industrial distributors have been busy responding to the flooding in the Midwest in the last two weeks. Though the situation has changed from emergency to cleanup, distributors large and small alike continue to respond to the need for safety supplies, tools, generators and maintenance products as businesses and residents recover from the damage.

With more rain in the forecast for parts of Iowa, Missouri and elsewhere in the region, some are concerned about the long-term effects on the economy due to flooded farmland and damaged crops.

INDUSTRIAL DISTRIBUTION spoke to distributors and manufacturers in the region this week about their efforts to help customers and their local communities cope with the disaster.

Apache Hose & Belting, Cedar Rapids, Iowa
The headquarters of Cedar Rapids-based Apache Hose & Belting is on high enough ground to escape the floodwaters of the Cedar River, but 12 of its 130 local employees weren’t so lucky when it came to their homes. Six of the 12 lost their homes and the other six sustained serious home damage in the flood, which devastated the area beginning June 12. The region is now in cleanup mode, but Apache’s vice president of supply chain management, Kyle Gingrich, says the disaster is far from over.

“I can’t stress or explain the emotions we’ve gone through as a company, trying to take care of our own people and then feeling a real [obligation] to our community,” Gingrich says, pointing to the need for hose, fittings and related products in anticipation of the flood and throughout the ordeal.

“It’s amazing to think that a piece of hose was so critical in this whole thing, but we feel like we were a critical piece of this—from the beginning and now during the cleanup. We’ve felt a real responsibility to perform at a high level for these last few weeks to help out.”

Apache’s employees have been working extended hours for two to three weeks trying to keep up with demand—at first for suction and discharge hose, fittings and strainers and now for the hose and accessories to go with pressure washers, washdown equipment and garden hoses.

“It started north of us and just kept coming south,” Gingrich explains. “As it continues down the Mississippi, we’re still involved because we have a number of re-distribution accounts that buy hose from us and are selling it to their customers—so they’re relying on us as well.”

With 175 employees and five locations in the Midwest, Apache is one of the largest specialty distributors of hose and belting products in the country. The employee-owned firm supports customers nationwide and was challenged to keep that business going as it struggled with events in its own backyard.

Gingrich notes that the situation is easing in Cedar Rapids. But until this week, the company was working with limited water and electricity.

“We were trying to conserve and still stay operational,” Gingrich explains. “Not only were we supplying product to the Midwest, we still have a nationwide business. … With everyone pulling together for the last two weeks, we were able to keep going.”

Apache established a foundation to help the 12 employees whose homes were lost or damaged, has brought in an outside consultant to help those employees fill out the necessary paperwork for assistance from the Federal Emergency Management Assn. and is providing them with paid time off to get back on their feet.

“If they don’t have a stable home life, they’re not here working, so we need them to have their home life secure,” Gingrich says. “This is one of those things you just hate to see. It’s our community. … It’s become a real emotional thing for all our employees.”

Gierke-Robinson Co., Davenport, Iowa
With branches in Waterloo, near the Cedar River, and hard by the Iowa River in Iowa City, Davenport-based construction equipment distributor Gierke-Robinson Co. was lucky to escape the floods unscathed, outside salesman Casey Timmons tells INDUSTRIAL DISTRIBUTION.
“Our Iowa City branch was concerned about being flooded itself, but [the river] didn’t get high enough,” Timmons says.

Though Gierke-Robinson wasn’t directly affected by the floods, the high waters kept the firm extremely busy—especially its pump sales and rental business.
“We had a lot to do to keep up,” he says. “I probably averaged over 16 hours a day [during the flooding].”

Besides its usual contracting and industrial customers, the floods brought a deluge of residential clients Gierke-Robinson’s way, as folks sought to keep their homes dry.
Keeping up with that demand posed a logistical challenge, Timmons adds.

“The supply is always there, but you can’t plan for a flood of this magnitude and have enough supplies sitting around,” he explains. “The product’s there, it’s just a matter of getting it from Chicago or logistically wherever it is.”

As they did after the Mississippi River’s historic flooding of 1993, people affected by this year’s high waters will take pains to be better prepared for the next round, which Timmons notes is inevitable.

“People are doing what they always do: Get back in there and clean up,” he says. “At some point it’s going to flood again, whether it’s 10 years, 15 years or next week. It’s just a matter of Mother Nature.”

And, he adds, Iowa’s weather forecast calls for rain over the next few days.

W.W. Grainger, Cedar Rapids, Iowa, branch
W.W. Grainger’s Cedar Rapids, Iowa, branch has been open extended hours since before Father’s Day weekend, when the flooding began. So far, the worst of the damage has been in the Cedar Rapids area, says Jay Fetsch, district branch services manager covering eastern Missouri, western Illinois and parts of Iowa, including Cedar Rapids.

After determining that no branch employees were personally affected by the flood, Grainger’s managers got to work stocking the Cedar Rapids shelves with pumps, hoses and generators, which were the most sought-after items initially. The branch was open from 5 a.m. to 11 p.m., filling orders for local businesses trying to stay ahead of the rising waters.

“We immediately started pulling big things—pumps, hoses and generators,” Fetsch says. “As parts of the city were flooding, the power company was shutting off parts of the grid, so generators were in demand.

“As it started getting worse, our employees in Cedar Rapids really rose to the occasion. They felt it necessary to stay open late in the evenings and on the weekend. I’m very proud of the staff we have in Iowa. They pulled through and they were very unselfish and unwavering in their efforts to serve our customers.”

Grainger employees from other locations pitched in to help this week, giving their Cedar Rapids colleagues a break from the 12-hour days they worked during the flood, Fetsch says, adding that Grainger’s products are still in demand as the focus shifts from emergency to cleanup.

“We’re still working extended hours,” Fetsch said. “But the waters are receding, and a lot of our larger customers on the river are involved in heavy cleanup now. We’re past reacting to the flood, but now we’re looking at safety supplies and cleanup-type supplies.”

Though Grainger’s branches and its employees escaped harm, the company’s Waterloo, Iowa, service center, northwest of Cedar Rapids, was not so fortunate. The facility itself wasn’t affected, but more than 75 of the center’s 200 employees saw their homes damaged by the flood and some were affected by a tornado that hit the region earlier in June, according to Vernon O’Donnell, a regional communication manager for Grainger.

“One employee’s home was completely destroyed,” O’Donnell says.

Grainger is helping the affected employees, O’Donnell says, and will be offering further assistance to local communities down the road. The company has already donated $15,000 worth of emergency cleaning supplies to the Red Cross in Cedar Rapids.

Iowa Tools Inc., Fairfield, Iowa
For Warren Wechsler, founder and president of Iowa Tools Inc., the past few weeks brought plenty of rain but no flooding, as his Fairfield-based tool distributorship isn’t near any rivers.
But the disaster is a mixed blessing for Wechsler’s fledgling business, which he started just over a year ago. With his nearest competitors literally under water, it’s a prime chance to expand his reach. But, he says, he’s reluctant to capitalize on the disaster.

“We’re one of those few communities in the state that was spared any damage of any kind,” Wechsler notes. “On the one hand, I’m an opportunist and I want to go after the business. But on the other hand, I don’t want to take advantage of my peers’ misfortune. I’m not sure what I’m going to do. … I don’t want to kick my competitors when they’re down, but on the other hand, when the phone rings and people say, ‘We need stuff…’”

In the meantime, he’s made sure to have plenty of inventory on hand for the cleanup phase—especially reciprocating saws, power washers and portable generators.

And he’s doing his part to help the region recover. A member both of the local Rotary Club and the nationwide NetPlus Alliance buying group, Wechsler says he put the word out that the Fairfield Rotary chapter was collecting donations to help the victims of the tornado in western Iowa earlier in June (“It’s been a rough month,” he notes). After news of the floods hit the airwaves, Wechsler says, he began receiving donations from NetPlus distributor members around the country.

“A lot of my manufacturing partners and the NetPlus Alliance [members] were calling and saying, ‘Hey, are you OK down there? What can we do to help?’” he says. “I’m getting unsolicited checks [from all over the country].”

Hannibal Carbide Tool Co., Hannibal, Mo.
Kathy Kapfer is president of Hannibal Carbide Tool Co., a cutting tools manufacturer based in Hannibal, Mo. Several of her company’s 110 employees volunteered with the Red Cross; others helped pile sandbags along the Mississippi River’s rising banks, she says.

“But the water has crested here, which is a good thing,” she explains, with tempered optimism. “It’s raining outside here now and they’re calling for rain into the first half of the weekend. So if that takes place, then that could change the situation.”

Hannibal Carbide’s business hasn’t been directly affected yet, Kapfer says, but some of its suppliers have experienced delays getting products to her company.

“[The floods] have extended some deliveries because, for example, certain bridges in the area are down and some [deliveries] had to travel further north to cross over from Illinois into Missouri,” she notes. “It’s nothing that’s caused us a problem, but there are some delays based on the logistics caused by the flooding.” The damage to area farmers and their crops has Kapfer most concerned.

“The farmland has been inundated here,” she says. “So the loss of crops, the loss of livestock—all of that has taken place. Food prices have already been going up due to the fuel situation. But now, with the hundreds of thousands of acres wiped out and the loss of that livestock—that will have an impact at the grocery store for everyone. That will be felt across the country and not just in the Midwest.”

In fact, many farms all along the Mississippi River, from Iowa to Missouri and Illinois, have seen this year’s soybean, corn and wheat crops severely damaged.

Some analysts estimate that 4 million acres of farmland were flooded throughout the Midwest, The St. Louis Post-Dispatch reported, and in Missouri at least 40,000 farm acres have flooded.

Final figures are expected in August, but the damage is expected to affect the nation's grain supply. Economists anticipated food prices would rise by as much as 9 percent before factoring in the recent flood damage, according to the Post-Dispatch. The most recent figures from the federal government, released June 20, estimate the price increase to be 5.5 percent.

The severe flooding in the Midwest’s farmlands in 1993 caused up to $20 billion in crop damage, the newspaper reported.

“The flooding in '93 was in the month of July when the corn was much taller,” Scott Irwin, an agricultural economist with the University of Illinois Urbana-Champaign, told the paper. “This [year’s] occurred when corn plants were just emerging,” and more vulnerable.
If the corn used to feed cattle and hogs is in short supply, prices for those meats will be affected, as will the price of other food sources, such as eggs.

“It's certainly been devastating for farmers in areas where the levees are breaking,” Estil Fretwell of the Missouri Farm Bureau told the Post Dispatch. “And to compound problems, it's been a late planting season already and where it was planted, it's flooded. The expense of putting a crop in has been extremely high, because of high fertilizer costs, seeds costs, and fuel costs. So the investment farmers are making is probably about the highest ever.”

Crescent Electric Supply, East Dubuque, Ill.
Illinois-based Crescent Electric Supply has 26 facilities in the region, several of which were affected by the flooding. As of this week, Crescent’s Des Moines, Cedar Rapids, Iowa City and Waterloo, Iowa, locations were up and running, as were all locations in Wisconsin, Indiana and Illinois. The company sells electrical, industrial and automation supplies and services from 127 locations nationwide.

Crescent is helping the affected communities get back on their feet with a matching relief fund supporting The United Way and The American Red Cross.

Originally focused on assisting communities affected by the tornadoes that hit the Midwest earlier this year, the matching fund has been increased from $25,000 to $85,000 to support tornado and flood victims in Iowa, Wisconsin and Indiana.

Crescent will now match donations to either The United Way or the Red Cross up to $85,000.

“We’ve seen so many of the people and so much of the geography affected by the floods of 2008 we wanted to increase our assistance,” said Crescent Electric Supply president Marty Burbridge. “We’re hoping [that] with a matching fund, we help raise a minimum of $170,000 to help.”

Added Dick Schmid, vice president of marketing: “We’re doing everything we can to get the necessary rebuilding materials into the area. We want to assist in getting businesses re-opened and people back in their homes as soon as possible. These people are not only customers, but over the past 89 years [since Crescent’s founding] have become our friends as well. It’s the only thing to do.”

To participate in Crescent’s matching fund, make checks out to:

* The United Way Tornado and Flood Relief Response
* The American Red Cross Central U.S. Tornado and Flood Relief Response

Send checks to:

John Miller
Crescent Electric Supply Co.
7750 Dunleith Dr.
East Dubuque, IL  61025