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Gases fuel profits at ILMO Products

Gases fuel profits at ILMO Products – A family company pulling business out of thin air for 104 years

BY DAVID BLANCHETTE
ILMO Products is profiled in the November 2017 issue of the Springfield Business Journal

A Jacksonville-based family company has been pulling business out of thin air for 104 years. But they are not just sitting on their gases. They continue to add product lines and find new uses for existing ones.

ILMO Products Company is a distributor of industrial, laboratory, medical, cryogenic and propane gases in bulk, micro-bulk and cylinders. They also feature retail sales of welding and safety equipment, accessories and welder repair services. ILMO produces 95 percent of their customers’ gas needs in-house.

ILMO has locations in Jacksonville, Decatur, Granite City, Litchfield, Mattoon, Mt. Vernon, Peoria, Springfield, Quincy and St. Louis. Its 100 employees service approximately 6,000 customers in the region, and their specialty gases section serves North and South America, Europe and Australia.

Brad Floreth has been the president of ILMO since 2000 and represents the fourth generation of family leadership for the company.

“I worked there summers and after school before I was 12 years old, painting gas cylinders,” Floreth said. “My dad would put the cylinders in place and I would paint them and then I would go get him to move them because I couldn’t roll them around, they were too heavy.”

ILMO began in 1913 vulcanizing tires and offering other services for the fledgling automobile industry. Early 1900s auto headlights used acetylene, which led ILMO to offer oxygen and acetylene products for the burgeoning welding profession, another new growth area. Supplying these two gases, plus argon for metal inert gas (MIG) welding, is still a primary focus for the company.

But a walk through ILMO’s Jacksonville facility also shows cylinders of all sizes and colors that are full or waiting to be filled with nitrogen, helium, carbon dioxide, nitrous oxide, propane and sulfur hexafluoride, to name just a few.

Trucks from supplier Air Products deliver the gas to ILMO where it is run through vaporizers, heated and pressurized, then put into steel cylinders. The liquid gas stays in the liquid state, in containers that resemble big Thermos bottles.

These compounds in gas or liquid form have a myriad of uses for operations as diverse as fabrication, food processing, coal production, power generation, steel construction, chemical processing, manufacturing, agriculture, cryogenic and laboratory research, health care and education.

You’ve undoubtedly heard about magnetic resonance imaging (MRI). As they say at ILMO, there’s a gas for that.

“With an MRI, you are taking magnets and are trying to get them down as close to absolute zero (minus 460 degrees) as possible, because the closer you get to absolute zero, the less resistance is in the magnet,” Floreth said. “We use liquid nitrogen and liquid helium for that. Liquid helium is about 450 degrees below zero and liquid nitrogen acts as an insulator to help keep the helium from getting warm too quickly.”

The extreme cold made possible by ILMO gases has industrial applications as well.

“We supply a lot of liquid nitrogen for fitting metal parts together, like an axle,” Floreth said. “You chill the axle down and it contracts a little bit, you slide it into whatever it’s going into and when it warms up, it’s in there for good.”

Many former chemistry students remember experiments with liquid nitrogen, where a rose dipped in the substance would shatter if thrown against a wall, or a nitrogen-coated banana could be used to drive a nail. What you probably didn’t learn in chemistry class is that your spice rack might be full of nitrogen-assisted products.

“If you spray herbs with nitrogen to chill them down and then grind them, you can get a better, quicker and fresher grind, then package them and use nitrogen to get the air out of the package,” Floreth said. “Some herb manufacturers use our nitrogen for that.”

ILMO’s Sam Mahan fills food grade CO2.
Photo By: David Blanchette

Floreth said ILMO nitrogen is also used by tire manufacturers to remove tabs from tires when they emerge from rubber molds, to fill space in food oil tanks so the oil won’t go rancid and to remove moisture from telephone lines to improve reception. Since the earth’s atmosphere is 78 percent nitrogen, this versatile gas is relatively inexpensive to produce at about $30 a cylinder, unlike the rarer and more expensive gases like helium, which makes up less than six parts per million of the atmosphere.

Sulfur hexafluoride, used at power plants to cool transformers, is about $600 per cylinder, Floreth said. A cylinder of xenon, which ILMO sells only on occasion, might list at $6,000 for a one-foot cylinder.

Linda Standley is ILMO’s CEO and is also Floreth’s cousin, in keeping with the family leadership philosophy of the company. She is proud of the new ISO-certified gas laboratory on site in Jacksonville that produces ultra-high purity gases. These gases are used as measuring benchmarks by laboratories, universities, utilities, high-end processing companies, law enforcement agencies and medical equipment manufacturers.

“EPA Protocol Gases are used to calibrate the emissions monitoring equipment that power plants like CWLP use,” Standley said. “They have to constantly test their emissions and keep records of that. We make the gas that they calibrate their equipment with.”

“The EPA testing gases are like a dog’s pedigree. We can say we produced the testing gas in this way, it’s the real thing, we did these steps, we used this machine and here’s the process we used to do it,” Standley said. “And we have a certificate of analysis that we furnish with the gas to certify the mixture is correct.”

Other testing gases produced by ILMO are used to calibrate blood gas, lung capacity and breathalyzer machines.

New and precise uses for gas are at one end of the ILMO product spectrum, but the other end features an oldie but goodie, the gas that heats homes, fires grills and dries corn. Propane is a relative newcomer to the ILMO family after the company acquired an agricultural propane business in 2011 and now serves hundreds of residential, commercial and agricultural users.

“Propane has been around forever, it’s not complex, it’s all about delivery and customer service, and forecasting,” Standley said. “We’ve always sold propane in cylinders for forklifts and that kind of thing, but we now have a large tank and a bobtail truck and we deliver propane to clients in 500-gallon or 1,000-gallon tanks like you see at houses in the country.”

“We just saw an opportunity. With our experience in delivery and customer service it was just sort of a natural thing to bring propane into our business,” Standley said. “It fits with the core of what we do.”

“There are two ways to grow for us. We don’t niche around a certain product, we define ourselves by our geography,” Standley said. “We try to do some of everything. We look at geographic expansion and look at adding new products that are related to what we do.”

Jay Pennell loading the Medical Oxygen “E” fill rack at ILMO.
Photo By: David Blanchette

Selling the product is one thing, but service is what keeps customers coming back. Standley said ILMO places a high priority on customer service.

“One of the things that we offer to our customers is our knowledge, because we cover such a wide variety of things and we have access to all of this training,” Standley said. “Many times for a small company, we are kind of their adviser on how to use our products.”

ILMO is an integral part of Illinois’ manufacturing base, a business segment that has seen its share of challenges in recent years. But the biggest challenge remains.

“Illinois. This state is our biggest challenge,” ILMO president Floreth said. “When someone just packs up and moves their plant out of state, we can’t go with them. We are tethered to this location. The heavy cylinders go out and get used, and we have to bring the empties back.”

“We participate in a benchmark with a number of other distributors in the nation, and we are always way off the chart on workers’ comp,” said Floreth, who added that the state’s tax environment and liability insurance costs are also concerns.

Challenges aside, ILMO is committed to remaining a manufacturing force in the region. Their staying power is reflected in some of the gas cylinders waiting to be filled in Jacksonville, several of which bear 1916 inspector’s stamps and which will continue to be used as long as they pass mandatory 10W-year inspections.

“You grow up working here and you end up here,” Floreth said. “To be in a 104-year-old family business and not have a bunch of fighting relatives is pretty unique.”

CEO Standley appreciates the company’s past and is looking toward its future.

“We’ve got some new young people who have joined the company. We are always looking for family members to come join the business,” Standley said. “We are starting down that path with my daughter, and Brad’s daughter may be interested at some point.”

 

David Blanchette is a freelance writer from Jacksonville and the co-owner of Studio 131 Photography in Springfield.

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