The electrical world is changing, and that change is opening new business opportunities for electrical distributors and their suppliers. Under pressure from OSHA, customers are confronted with a paradigm shift: Electrical systems can no longer be considered unchanging elements of a business. They require regular maintenance and upgrading. Hazards must be identified, eliminated or mitigated, and workers need ongoing training as part of a new comprehensive electrical safety program.
Why has OSHA toughened its stance? Hard numbers. The U.S. Department of Labor reports that 9,600 serious electrical shock and burn injuries occur each year — 80 percent of which result from arc-flash events. In recent years, OSHA has retrained its inspectors to look for compliance with NFPA 70E, which requires employers to specifically identify electrical workplace hazards. An NFPA 70E Electrical Hazard Assessment includes collecting data on the electrical infrastructure, updating one-line diagrams, and analyzing circuits for coordination, available fault current and determination of all electrical hazards down to 50V, including Arc-Flash Incident Energy hazards. It's a big job, and companies are looking everywhere to find help.
Some sophisticated electrical distributors are already partnering with engineering firms to offer assessment and training services to their customers, and they are finding that it's very profitable. Margins are better on services than on products, because there's nothing to carry in inventory.
For savvy distributors, the relationship provides an on-going opportunity. Yes, an electrical hazard assessment is a one-time service — yet out of it comes continuing opportunities for product hardware sales, including upgrades of switchgear, circuit breakers, fuses, disconnect switches and personal protective equipment. And if the assessment finds insufficient designs, improper installations or under-maintained equipment needing repair, distributors can offer to assist in correcting them. Creating a solution for the customer creates an even healthier bottom line for the distributor and raises the company's image as the customer's valued partner. The customer starts to see the distributor as the provider and initiator of solutions, rather than as a mere link in the supply chain.
These are uncharted waters for many distributors. Up to now, many were intimidated by the complexity of selling engineering services and assessments. Many have had no experience in pulling together the intangibles of services from various vendors. That's why it helps to join forces with a single partner with enough resources to implement all of the service elements.
By offering an integrated total solution — including the assessment and one-line diagrams, lowering of hazards, product repairs and worker training — the distributor is initiating a time- and cost-efficient approach to resolving the customer's challenges regarding the plant's electrical infrastructure and safety compliance. After all, who knows the plant's deficiencies and required remedies better than the engineering firm that collected the electrical data and identified the hazards? Who better than that firm to provide the safety training and the field marking of hazards? Why separate the engineering piece from the safety piece or the training piece when it can be folded together? The answers to these questions can close the sale of the integrated total solution.
For the distributors, directing the overall upgrade and repair of the electrical infrastructure, while reducing hazards, creates a new kind of bond between them and their customers. Possessing the unique marketing intelligence generated by the assessment, distributors can transform knowledge into quotes in an environment in which sales are directly related to the electrical density, health and safety of the customer's facility. In most cases, this will represent tens of thousands of dollars in the sales of services and products to one customer.
Moreover, this approach allows continuing value as the “go-to guy” for years to come. Because of finite capital resources, the customer will never be able to implement every correctiveaction at one time. Corrections will most likely take place over two to three years and the distributor will be positioned to respond to the customer regularly. Bringing the engineering, products (including safety equipment) and training to customers allows electrical distributors to control their sales destinies and, of course, the request for proposals (RFPs).
Generally speaking, the distributor needs a partner in the truest sense — one that can act in concert with the company at every stage of creating a solution for the customer. That starts with a common marketing voice that persuades the customer about the value of compliance and continues all the way through training, product upgrades and product repairs. While this provider creates and executes the assessments and training, the customer sees the distributor as the conductor of the overall business solution.
The electrical distributor should seek a services provider partner that can:
Commit to partnering, supporting and working with them from Day One.
Provide OSHA/NFPA compliance education for the customer.
Provide sales materials that promote the value of the integrated total solution, when conducting an electrical-hazard assessment.
Commit to lowering the customer's electrical hazards.
Train all of the customer's workers.
Create and distribute necessary job aids for the customer's workers.
And offer lead-generating tools such as seminars and webinars to the distributor's customers.
In today's electrical world, we're looking at a blue-collar industry being legislated by new safety requirements that force customers to leapfrog 30 years of electrical neglect and 30 years of stagnant worker safety training. Many business functions will be impacted, including electrical design, facility engineering, maintenance operations and safety. A seamless, turnkey solution is the obvious answer, and for the distributor, it's an obvious sales opportunity.
Larry Altmayer is POWR-GARD services manager, Littelfuse Inc., Des Plaines, Ill. He has been providing OSHA Compliance and NFPA 70E training to plant and operation managers, electrical-maintenance supervisors, safety managers, facility and safety engineers and consultants for more than 10 years. He has co-authored or contributed to the Littelfuse Electrical Safety Handbook and has published articles on electrical safety, protection and controls. He has given hundreds of presentations to facility engineers, electricians and maintenance workers on electrical safety, NFPA and OSHA regulations. He can be reached at [email protected].