Telemarketing Leads BTB Vendor to Sales Leap

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Four outbound telemarketing call centers are driving $100 million in annual sales of safety equipment for Airgas Inc., a business-to-business distributor of industrial products.


Airgas, Radnor, PA, which claims to be the largest distributor of industrial, medical and specialty gases and welding equipment in the country, uses telemarketing extensively in its safety-product division. Telemarketing sales are increasing, with $74 million in revenues for the last nine months of 2000 compared with $66 million for the same period in 1999, the company said.


Airgas' safety division uses 90 telemarketers, based in call centers in Atlanta, Los Angeles, Milwaukee and Philadelphia, to maintain an active customer base of 25,000 businesses. Sales agents are charged with developing and maintaining their own base of regular customers. The majority of those who buy are repeat customers, said David Levin, president of the safety division.


Agents are expected to make 70 calls to existing and potential clients each day. The company generates sales leads by subscribing to lists of industrial companies and by following up on referrals from customers and vendors. Targeted businesses, all in the United States, include an array of construction and manufacturing companies and range in size from small businesses to Fortune 500 firms.


Product sales values vary, depending on what the customer wants to buy, Levin said. Orders range from bulk purchases of earplugs, which cost pennies apiece, to big-ticket items such as a $2,000 breathing apparatus. However, the majority of Airgas' products cost less than $100.


Because of the highly specialized nature of the niche business, Airgas takes extra time to ensure that its telesales agents are trained, Levin said. Each agent undergoes a three-week training period after hire, and all go through daily educational sessions to keep them updated on new products.


Levin estimated annual turnover at Airgas call centers to be around 10 percent. Although he declined to go into detail, he said an attractive compensation plan for agents helps the company maintain a stable base of employees.


Agents also experience lower rejection rates compared with those experienced by traditional telemarketing agents, Levin said. Closed-sales-to-calls ratios tend to be higher in the specialty telemarketing business because agents typically do less cold calling than traditional outbound call center agents do.


Among its call center staff, the company maintains two subgroups of agents who specialize in sales to other distributors and to environmental and abatement firms. However, most Airgas agents handle a broad range of customers.


Airgas expects its agents to build personal relationships with customers, Levin said. New agents, who typically have no experience in telesales or safety products, are provided with lead lists to give them a head start and must develop regular customers to ensure good sales and good commissions.


"We look for people who are successful, hungry entrepreneurs who are eager to develop their talents," he said.


Airgas has used telemarketers to sell its safety products since the mid-1980s. Telemarketers replaced the company's field staff of road salespeople, who could not reach potential customers as cheaply or as quickly as the telephone sales staff could.


Overall sales for the company in the last quarter of 2000 were up 7 percent over the previous year. Fourth-quarter 2000 sales were $395 million, up from $369.4 million in fourth quarter 1999.


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