Sea Of Opportunity

The 2007 Farmers Almanac states it succinctly: “Shivery is not dead.”

Despite a barrage of media reports that foretell a future of heightened temperatures due to global warming, the Farmers Almanac predicted a cold and snowy winter for the majority of the country. In most cases, the 2006-07 winter was snowier and colder than recent years.

While the effect that global warming has on ice melt sales is debatable, one thing that remains clear is that as an industry, ice melt is dependant upon the ever-fickle Mother Nature.

Warm Weather, Cold Sales
Whether a person believes in global warming or not, ice melt manufacturers in general say that recent winters typically trend toward mild.

“With all the discussion on warming, we’ve tried to look at it for the snowbelt states and bigger cities in Canada and we have — over the last 30 years — seen a slight upward trend in temperatures,” says Greg MacDonnell, senior marketing manager, Dow Calcium Chloride, Luddington Mich. “We’re seeing that the winters are shorter and generally a little bit more mild than they were 30 years ago. That isn’t a consistent pattern year in, year out, it fluctuates. But there is a general uptrend towards milder winters and as a result, shorter snow and ice melt seasons.”

However, manufacturers say that while recent winter seasons have been mild, they also have provided unpredictable, extreme weather situations.

“With weather, you have the ups and downs,” says Ken Ossian, owner of Ossian Inc., Davenport, Iowa. “As weather patterns change we will have more frequent storms that aren’t the large storms that we might have seen in the past. The need for de-icing doesn’t necessarily decrease.”

It has not been proven that global warming affects ice melt sales, according to Bill Kinney, national sales manager, Frank Miller & Sons, Riverdale, Ill. Moreover, he says that while the past few winters have been relatively mild, weather is cyclical and cold, snowy winters will return.

“I believe everything will even out as far as weather is concerned,” Kinney says. “As an industry, I believe sales have been down in the last several years but I fully expect a rebound in the coming ice melt seasons.”

Overall, milder winters have not had a catastrophic effect on sales, according to most manufacturers. Most customers are still buying during the preseason and later, as weather dictates.

There’s always an early buy, but there needs to be the ability to provide that material when it is needed most,” says Bob George, vice president, International Salt Co., Clarks Summit, Pa. “In other words, you don’t need ice melt in the spring or summer, but you need it when it is negative 10 degrees and you’ve got a major storm on the way. These highs and lows can lull people to sleep a little bit. There is a tendency for people to start thinking about what the past few winters were like and that’s no assurance that it’s going to be the same next year. If they got away with using a certain amount of product last year, they think that they might need 70 percent of that.”

This year, some believe late ordering may be common in some markets because the last couple of years have been mild.

“We find that ‘previous seasons’ tend to greatly impact the ‘early buy’ patterns of the following season,” says Carlos Rodriguez, marketing manager of packaged de-icing products for Cargill, Minneapolis. “For example, the last couple of winters have been mild, so distributor and customer inventory may have not moved as well and carry over levels may be higher than normal.”

Other manufacturers predict a great year for pre-season sales. Based on feedback from distributors and end users, Ossian says the storms in late February and early March have emptied many stockpiles.

“Quite frankly, we anticipate that it will be a very healthy preseason program by most distributors,” he suggests.

Caught Off Guard
One easy way for distributors to lose clout with customers is not being able to provide them with ice melt when it is needed. While ice melt is not a complex product, if it is not available when the first few flakes of a storm start flying, it can result in far-reaching consequences.

Ossian recalls one instance in which the headquarters of a multi-national shipping company based in the United States was hit by a major storm a few years ago.

“It shut down the highway system for five days and [the company] couldn’t get its trucks out,” says Ossian. “It had such a devastating effect on [the company] that they informed the governor of the state that he would have to do a better job of maintaining his roads or they were going to move their operation because they cannot be shut down for five days.”

While storms generally do not wreak as much havoc near facilities as they typically do on roads, facilities do need to be able to operate. “When your office isn’t open, when a school is closed, or anything along that line, you have huge economic costs,” says Ossian.

It is relatively simple for a distributor to ensure a proper level of stock is maintained by having a close relationship with an ice melt manufacturer.

“It is best to plan for the worst,” says Kevin Wice, president, Xynyth Mfg., Corp., Burnaby, British Columbia. “We all know how accurate the weatherman is. Our recommendation is to align themselves with a manufacturer who has the ability to supply product promptly when they need it, but who doesn’t require them to take all stock up-front.”

Todd Spencer, national sales manager-jan/san, North American Salt Co., Overland Park, Kan., agrees.

“Somewhere there will be a surprise turn in weather or a decision made to hold off on purchasing,” he says. “What the distributor needs to realize is that when the storm hits, others may have been hit unexpectedly and you get a panic buying mode. North American Salt prides itself on the ability to help those that have fallen into this category.”

Spencer says North American doesn’t run out of stock and has strategically located warehouses, so the company is able to service both its steady, regular customers and those who find themselves in a pinch from holding off too long.

However, distributors should not assume their orders will be immediately filled if they wait until the last minute to order.

“In some cases, it may be cutting it close,” says Rodriguez. “Product turn-around is dependant on manufacturer’s inventory, manufacturer’s ‘surge’ or ‘sprint’ capacity, manufacturer’s access to the raw ingredients and manufacturer’s and distributor’s access to trucks.”

Kinney also receives “panic calls” from customers looking for immediate delivery. “We have a new plant in Sturgis, Michigan that has a very good production capacity, but sometimes those customers are delayed by trucking issues in the peak of the snow event.

There is a very simple way of continually working with customers to assess their ice melt needs — pay attention to the past.

“Whatever the customer, look at past strong winters,” says George. “The amount of inventory they went into that season with is probably the same type of inventory level that they should be carrying again in the upcoming winter season.”

Reducing Hesitancy
Distributors occasionally run into customers who are hesitant in making pre-season purchases, both because of mild-winter predictions and strapped budgets. This should in no way prevent distributors from showing customers the clear benefit of having stock.

Inform them that purchasing ice melt before it snows is the same as purchasing insurance, says Kinney.

“You never think you will need it until you have an accident or snow event which is bound to occur at some point. Distributors who know their end users ice melt needs should be able to monitor their supplies and keep them in sufficient stock before a major snow event.”

Indeed, ensuring the safety of building inhabitants is of utmost importance for facilities. As litigation over slip-and-fall accidents continues to escalate, the demand for ice melt products also soars.

“There’s a growing awareness of the risks associated with slip and falls, says MacDonnell. “Lawyers are capable of detailing weather conditions in any particular location these days with all the information that is publicly available, and they arm themselves with data to question whether a property manager is using the right ice melter for the right conditions.”

For this reason, Rodriguez says end users need to have enough ice melt for one to two storms. “This is not a large economic commitment and makes the customer or end user be prepared for the season, ensuring they have product and don’t need to deal with the hassle of all those rushing around at the last minute just before the storm,” says Rodriguez.