Leaders in a Western Canada niche market

By Cheryl Long

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They say the third time’s the charm. That was the case for CFR Chemicals, which was recently named one of Canada’s Best Managed Companies for 2014. It took three tries but after narrowing their focus and further streamlining their operations, the company moved from the finalist category to the esteemed list of 50 outstanding companies.

“When you go through a process like that, you have no choice but to take a microscope to your own strategic process and see what works and what’s not working,” said President & CEO Brian McKay. “Because we’re a smaller player in a very big industry, I think it’s given us a bit of credibility; to say to some of the bigger and more well-known companies: hey, we’re a company that’s been around and we think we know what we’re doing and somebody else thinks we know what we’re doing too, and we’re doing a fairly good job of doing it.”

CFC Chemicals was founded in Red Deer, Alberta in 1996 as a glycol fluid recovery business but a few years later, the company’s founder realized that there were bigger and better opportunities in the oil and gas sector. Not only was it an ideal market for a company located in the heart of Western Canada, but they could also see global expansion in their future.  In 2010 the company’s major shareholders decided to take the organization private, leading to a major change in ownership structure and a more nimble, focused approach to the business.

Leaders in storage capacity and rail access

Today, CFR Chemicals brings in chemicals from all over the world for distribution to the energy and industrial manufacturing industries, and has expanded their sales and distribution teams to locations in Alberta, British Columbia and Saskatchewan. The company will store, trans-load, transport and blend chemicals for their clients. What makes CFR unique is their capacity, both in storage and rail access, which exceeds that of their larger competitors and allows them to store and manage their clients’ chemical inventory.

“We have more flammable and non-flammable tank capacity than anybody in Alberta and more rail capacity than anybody within the chemical space in Alberta,” McKay said.

Rather than investing their own resources and capital in storage infrastructure, CFR Chemicals provides that capacity to their clients. Last year, they invested $6.5 million to triple their rail capacity as part of an ongoing plan for future growth.

CFR specializes in both products and services. Products include gas processing and industrial chemicals, and specialty and oil production chemicals.  They’ve also developed proprietary products, such as their patented H2S scavengers, as a means of finding innovative solutions to meet their customers’ needs. Their range of services has been designed to close the gap between customers’ needs and the standard menu offered by the industry. After-hours and emergency chemical services, bulk tank rentals and chemical storage services, logistics and trans-loading services, and laboratory analysis and oilfield consulting are the offerings that separate CFR from some of their competitors. Innovation and sustainability also play a large role at CFR chemicals, ensuring that the products they develop reduce the industry’s impact on the environment.

“We really do pride ourselves in trying to find unique and different ways to help our customers in the field,” McKay explained. That can mean everything from managing inventory to providing technical support. “We do really look at our customers as partners and we try not to look at them as a mechanism just for us to run a business and make money. We look at it as an opportunity to create a really strong partnership and grow our businesses together.”

Most of the operations located in Alberta

They consider themselves primarily a regional business with about 90 percent of their operations focused in Alberta. Over the next five years CFR plans to expand further into British Columbia, particularly into the northeast region, which is tightly connected to northwest Alberta, McKay said. They’ll also stretch into Saskatchewan, continuing to excel in their niche by keeping to a specific suite of products and services.

As a company, CFR Chemicals has a number of strengths: their infrastructure, the location of their infrastructure, and their access to capital, which allows for continued investment in capacity. But it’s also the people who come to work each day that drive a good portion of the company’s success. They currently stand at 37 employees, and are proud to have a turnover rate that is the lowest in their industry, McKay said. They aim to maintain a small yet highly skilled staff, allowing the company to withstand the ups and downs of the oil and gas industry without having to resort to layoffs.

“I think we treat our employees well,” he said. “We communicate well with them, we provide a platform for them to have the autonomy to do their work and we show appreciation for what they do.”

Safety always a high priority

Fostering a safe environment is also crucial, particularly in the chemical industry, and CFR puts a high priority on the safe handling of their products. Last year, they were awarded the Canadian National Railways (CN) Safe Handling Award for their safe rail loadings throughout 2013. With a capacity forover100 rail cars and the storage of more than six million litres of products at the plant in Kuusamo, Alberta, maintaining that safety record takes a concerted effort.  They also have an Alberta Certificate of Recognition (COR), and are certified by the Canadian Association of Chemical Distributors and the Petroleum Tank Management Association of Alberta.

Giving back to the communities in which they live and work is part of CFR’s mandate. They’ve offered their support to the Canadian Cancer Society, to local hospitals and to programs and special events throughout their trading areas. One of the company’s largest community investments to date was their recent multi-year sponsorship of the Midget AAA Bison hockey program. Now known as the CFR Bisons, the team and their sponsor company have similarly aligned goals and objectives.

“It’s a very highly-regarded program,” McKay said. “When the opportunity came for us to sponsor them, we thought it was a nice way for us to give back to the community and align ourselves with somebody that has the same kind of outlook on their people and businesses as we did.”

To learn more about CFR Chemicals, visit www.cfrchemicals.com.