For some electrical distributors, the business is more than just a numbers game. Sure, some companies can eke out a semi-profitable living by selling large volumes of electrical equipment at extraordinarily low margins. But savvy distributors know there's even more money in selling solutions to customers' problems. That strategy must be more than a well-worn phrase pulled from an MBA text, because in the real world selling solutions is a way of life that takes a sizeable investment in training, inventory and personnel.
Because of changes in electrical codes and National Fire Protection Association (NFPA) standards and the increased interest that the Occupational Safety and Health Administration (OSHA) has in arc-flash incidents, electrical distributors' customers are searching for solutions to protect their facilities and comply with these new regulations.
For the past three years, Littelfuse Inc., Des Plaines, Ill., has run Electrical Hazard and Arc-Flash Training seminars to promote awareness of arc-flash and other electrical hazards among electrical maintenance personnel and to provide guidance and training on how to reduce the potential hazards.
Cape Electrical Supply Inc., Cape Girardeau, Mo., took Littelfuse's resources and information on how proper overcurrent protective devices, a comprehensive facility electrical hazard evaluation and implementation of an updated safety program can help reduce and eliminate arc-flash hazards and blended it with similar information from vendors of products such as circuit breakers, power distribution equipment, safety labeling and personal protection equipment (PPE) products to develop a solution that can help prevent arc-flash incidents.
Cape Electrical Supply's efforts include full-day seminars, “walk-throughs” of customer facilities to identify potential arc-flash problems, suggestions to update the line drawings of a facility's electrical system, and assistance in developing safety programs and worker training programs.
Customers have been quite receptive. Says Bob Garrett, vice president, Cape Electrical Supply, “There was a demand on the manufacturing and plant floor side of the business to learn more about it. In a lot of cases, we were the first one to the door with a proactive approach.
“We have found that a lot of the large industrial facilities — in many cases Fortune 500 companies — have a mandate throughout their organizations to create line drawings, as well as to create a safer workplace relative to NFPA 70E Shock and Arc Flash Hazard Assessments, safe work procedures and products such as current-limiting devices that can reduce hazards. We found that we had an audience, and we became proactive in the whole thing — not just waiting for the phone to ring, but also going out to plant engineers and talking about it. We found that many of them have a memo on their desks from their corporate headquarters essentially saying, ‘Hey, we need to be in compliance.’
“The seminars had overwhelming attendance. When we expected 20 people we had 40 people, and when we expected 40 people we had 80. There was quite a bit of built-up demand and interest, and we were fortunate to have a great vendor community across multiple product lines prepared to take 30 minutes or an hour and talk code compliance, personal protective gear and safety related products like insulated tools and current-limiting overcurrent protective devices (fuses and circuit breakers).”
The company promotes the seminars at least a month in advance. While Cape Electrical Supply does mass mailings and includes promotions in customers' monthly billing statements, it relies on its industrial salespeople to get to the proper contacts at their accounts. Says Kyle Thoma, industrial sales manager, “We put together the arc-flash seminars because there was a need to do that — people wanted to find out more information and get educated. The sales function came shortly after that. I noticed a very large learning curve from the first seminar to when we hosted to the second. The momentum of this has picked up so much.”
Thoma says the seminars cover not only fuses, but also personal protection equipment (PPE), circuit breakers, switchgear, diagnostics equipment and labeling. “We try not to keep it as a one-sided event,” he says. “We do a combination of product solutions from multiple vendors.”
Bob Garrett says the company's salespeople often attend the seminars to learn how to spot potential sales opportunities at their accounts. “As our own sales force becomes educated, it's a two-edged opportunity,” he says. “Now those guys can go out and find an opportunity and bring it back to the party. We have had a combination of industrial facilities that want to learn more, and our own salespeople are saying, ‘I know where there is an opportunity.’”
Once educated in Cape Electrical Supply's arc-flash seminars, customers often find they need help identifying potential arc-fault situations in their facilities and call the company for help. Mike Austin, one of Cape Electrical Supply's industrial salespeople, has developed a specialty in these site visits. He was trained by Littelfuse to do these walk-throughs and to do an inventory (take-off) of the electrical distribution equipment in the facility that needs further analysis. Larry Altmayer, POWER-GARD services manager, Littelfuse, says Austin's site visits help his company provide customers with engineering proposals to quantify the amount of work that needs to be done.
“What makes Cape Electrical Supply really unique is that Mike understands the safety requirements and performs these site visits himself,” he says. “He has done so many of them that he can provide us with the information to speed the process along. He is not waiting for someone to come down and work with him, although if he said, ‘This one is going to be tricky,’ or, ‘This one is going to require some hand-holding because the customer wants to see you and meet you,’ we would be there as quickly as possible.”
“Once you get the hazard assessment done, it doesn't stop,” says Austin. “It's an ongoing process. You try to get there when they do the changes in the facility. They will move all the lines around if it's a manufacturing facility.”
Littelfuse's Altmayer says hazard assessments will also reveal that many customers don't maintain the one-line drawings of their electrical systems. “They are missing a fundamental building block to understanding their hazardous locations,” he says. “They have to pull their one-lines together, do a short-circuit analysis, and look at overcurrent protective devices and their coordination to understand the clearing times of those energy levels. Then they are ready to do an arc-flash analysis.”
One of the reasons arc-flash incidents now attract so much attention is that arc-flash injuries are occurring frequently. This is a result of improper work procedures, lack of flame retardant PPE, and the fact that electrical maintenance personnel are working on live circuits so often. Altmayer says OSHA's lockout-tagout rules and other safe work practices have helped cut down on arc-flash incidents, but that working on live circuits is still quite common. “Some customers live by lockout-tagout,” he says. “There are many customers that do it where they see it to be feasible but their definition of feasible is a very interpretative area. It would not follow the same criteria as OSHA.
“We see a vast number of customers not deenergizing for their own specific business reasons. But they are coming to the realization that once the severity of hazard is known, they must de-energize and put on flame-retardant clothing or heavy arc-flash suits to avoid the hazard. At the end of the day, customers are now doing what they always should have done, which is to de-energize as much as possible.”
To eliminate opportunities for arc-flash incidents, manufacturers are redesigning their product lines. Altmayer says gear manufacturers are venting the hazardous energy away from maintenance workers, insulating the busbars, putting in insulated barriers or including padlocks with the equipment, and that distribution equipment manufacturers are upgrading their overcurrent protective devices so they are more current-limiting and providing switches that will provide instantaneous tripping mechanisms that will lower hazards.
“The electrical infrastructure is even being redesigned to have multiple power sources so customers can do preventative maintenance with a minimum of downtime,” he says. “There is a new generation of equipment coming.”
New National Account
Cape Electrical Supply's niche in arc-flash training and assessment recently paid a big dividend. One customer, a Fortune 500 industrial with a plant in its market area, asked Cape Electrical Supply to do a site analysis. The customer was impressed with the company's expertise, and asked them to do analyses at its other facilities around the United States.
Says Mike Austin, “It was a plant that we were calling on regularly. We were probably the first call. They had been to one of our seminars and we had done the walkthroughs. We started at that facility, and went from that facility to the next facility. We then went to their corporate facility with Larry Altmayer to talk with them on a corporate basis.”
Littelfuse's Altmayer says an arc-flash program can help electrical distributors get three different pieces of repeat business. “Once the engineering studies and one-line drawings are completed, the customer will need them updated periodically to accommodate any changes in the infrastructure or available fault current that may increase or decrease the hazard level,” he says.
“Then there is worker training. Once you get done with the entire process, you must teach the maintenance workers and electricians where those hazardous locations are and how to deal with them. At the same time, end users are realizing that both qualified and non-qualified workers need to be trained to be aware of these hazards.
“They are rethinking their entire safety program and are establishing new electrical safe work practices and methods for auditing their procedures. In the future, customers will be conducting annual arc-flash training with the lockout-tagout training to all workers.”
Cape Electrical Supply's Bob Garrett says its arc-flash program fits in with its overall business philosophy of striving to make each salesperson the “go-to guy for the customer.” He says if a salesperson can become the go-to guy for arc-flash, he can become the go-to guy when the customer is ready to relight the plant, put their MRO bill of materials out for tool crib management, or when they are going to do a 150,000-square-foot plant expansion and need some budgetary numbers.
“Not only is it a compounded opportunity if you are the go-to guy in the field of technical expertise, but there are a number of subcontractors getting involved at the plant level,” he says. “This is a part of that service work. It's nice when you can bring a good business opportunity to a qualified contractor and create comfort for the industrial facility in knowing that they are paying for expertise that ensures accuracy and compliance. We have been able to walk into an industrial contractor and say, ‘We have a Fortune 500 company down the road that's going to do a complete line-drawing analysis.’ The contractor appreciates that work. You can compound the opportunity across a lot of fronts.”
Garrett says its arc-flash program also fits into Cape Electrical Supply's long-term growth strategy. “We look at our business and say, ‘We can either go out and grow through acquisition, grow into new markets where we don't have a presence, or grow with existing customers organically. Or, we can find niche opportunities to grow in. That's where we view the arc-flash opportunity.
“In the last 20-something years I have been in this business, if you wait for the phone to ring or wait for the bad news about the recession, you will go that way. You need to pick up the phone and look for opportunities. It's not recession-proof, but people are spending money on this type of requirement.”
Arc-Flash Incidents: Disasters that Happen All Too Often
The numbers stagger the mind: Every day, 10 arc-flash incidents occur, and every year 2,000 workers go to burn centers with severe arc-flash burns.
Each arc-flash incident is in itself a massive explosion, because at 35,000 degrees F, the arc can be hotter than the sun and can vaporize anything in its path. Larry Altmayer, POWER-GARD services manager, Littelfuse Inc., Des Plaines, Ill., is a well-known expert in the electrical industry on electrical safety matters and has been Littelfuse's point man on providing distributors and end users with the training and information they need to develop solutions to eliminate arc-flash incidents. Altmayer has given hundreds of seminars on arc-flash safety compliance and other electrical safety topics during the past 10 years and recently wrote an article for Electrical Wholesaling on the topic (January 2008, p. 74). He says that since the National Fire Protection Association (NFPA) issued its 70E Standard on arc-flash in 2005, many distributors' customers have attended seminars on arc-flash and understand what NFPA 70E requires, but they don't necessarily know how to apply it to their businesses.
According to www.mikeholt.com, “An arc flash is the result of a rapid release of energy due to an arcing fault between a phase bus bar and another phase bus bar, neutral or a ground. During an arc fault, the air is the conductor. Arc faults are generally limited to systems where the bus voltage is in excess of 120V. Lower voltage levels normally will not sustain an arc.”
Hazard assessments are performed down to 50V per NFPA 70E standards. In fact, the 2009 edition will require customers to field mark all panels with the potential arc-flash incident energy and the panel's Hazard Risk Category, even if the panel is Hazard Risk Category zero.
Adds Altmayer, “Essentially, arc flash is the release of the full potential of short-circuit energy available at any piece of equipment as it finds a path to ground. It's a very dangerous situation.”
He says it's totally unpredictable when arc flashes will occur. “Equipment might be fatiguing and you are getting tracking across worn-out insulation of cabling,” he says. “It could just be that components have deteriorated, or possibly undersized short-circuit current ratings of devices within the electrical system. Or, there is an accident — live conductors are touching each other, or someone drops a tool within the equipment. You get this snowballing effect of an arc flash that creates a huge hazard.”
He says that because so many electricians and maintenance personnel now work on live equipment, it increases the possibility of accidents. “What is normal within this industry — right or wrong — is that workers are working on the equipment live. OSHA's requirements are to deenergize.”
Along with providing safer working environments for workers, Altmayer says adhering to the NFPA 70E standard can actually help customers run their business more efficiently.
“NFPA 70E is a consensus standard, a guideline that says, ‘Go find the hazards, and here is how you deal with the hazards.’ The customers wanted more than that. They want to remove the hazards, because if they don't have any hazards, they might not have to wear all of this PPE and can run their business differently. Engineering is required to identify the hazards and reengineering is required to remove the hazards.
“This is where another topic is coming up. There is a paradigm shift coming up where everyone is now upgrading their safety programs — redesigning their safety programs, redesigning old facilities, and taking safety in mind when creating new facilities. It's becoming a very talked-about safety issue and has been embraced by OSHA. OSHA hasn't adopted it, but it has recognized it.”
For more information on arc-flash, check out www.littefuse.com.
Cape Electrical Supply By the Numbers
Founded 55 years ago in Cape Girardeau, Mo., the company focuses on commercial, industrial, residential, institutional and utility accounts. It also has a significant presence in the national accounts and voice-data-video (VDV) markets. Cape Electrical Supply has 18 locations along the Mississippi River corridor in Missouri, Kentucky, Illinois and Tennessee.
- $72.4 million in 2007 sales
- 138 employees
- 8,500 customer accounts
- 25,000-plus stock-keeping units
- Member of Affiliated Distributors