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FASTENER HISTORY
2011 FIN – Kangas of Alaska: Technology Vital for Permafrost & Fasteners

December 8, 2011 FIN – Mike Kangas recalled technological developments that have allowed Alaska to build an oil pipeline in the permafrost and Alaska Industrial Hardware to start in a Quonset hut and now conduct e-commerce.
“Technology has led the way toward many new and innovative construction designs in the Arctic climate,” Kangas said in his State-of-Distribution address to the Specialty Tools & Fasteners Distributors Association’s 35th annual convention.
Alaska Industrial Hardware was founded in 1959 in a Quonset hut on a muddy road that is now in the center of Anchorage.
“The founder had a simple plan – buy surplus nuts and bolts, repackage and sell them,” Kangas – the current president and general manager – said.  “In fact, some of you may have started your company the same way.”
In 1964 an earthquake created an immediate need for tools and hardware “and put AIH on the map,” Kangas said.
In the mid-70s, construction of the Trans-Alaskan pipeline “gave AIH more business than we could handle at the time, and gave us the opportunity to expand throughout the state.”
By the 1980s, a recession and oil dropping below $8 a barrel left Alaska overbuilt, housing prices plummeting and banks loaning money to people without the ability to repay.
“Umm, sound familiar?” Kangas referred to the current economy.
The Alaskan economy struggled until the Exxon Valdez ran aground in 1989, “spilling millions of barrels of oil and forcing a cleanup effort that lasted for years.”
Kangas noted Alaska has more coastline than all of the rest of the U.S. together and it is one-third the physical size the combined other 49 states.
Customers in the state can be as far away as Florida from California, he pointed out.
Getting product to the Port of Seattle is just the first challenge, Kangas explained.  Shipping in containers from Seattle to Alaska may take from four to 10 days due to storms with 100-foot waves and hurricane-force winds.
That means suppliers need to anticipate sales 60-days in advance.
Customers in Alaska may be around the corner or may be a community general store served only by air.
Permafrost Construction
In the winter the ground may be frozen down eight feet.  “This layer has to be removed or thawed before any construction can begin,” Kangas explained. That may require a big excavator with a ripping bar or a portable thawing system before footings can be formed.
A plastic tent blown up like a big balloon protects the site from refreezing.
“Without these building techniques work would stop around November – earlier as you move north – and not begin again until spring,” Kangas explained. “That made for some very slow months for this STAFDA house and many others.”
Farther north with winter temperatures of –50 degrees the ground is so unstable “it’s unbuildable with conventional construction techniques due to permafrost.”
Kangas noted hundreds of miles of the Alaskan pipeline was constructed on permafrost.
“Thousands of piles were driven into this frozen substrate and by circulating ammonia throughout the piling, all ground heat is removed that would otherwise cause the permafrost to melt,” Kangas explained. “This is one of many cold weather construction techniques pioneered and developed in Alaska.”
A total of 28,000 people were employed over three years to build the 800-mile, $8 billion pipeline. Oil began flowing in 1977.
Transportation by only air and water require “everything must be preplanned well in advance, because there are very few lumberyards or hardware stores close by. A small home can cost hundreds of thousands of dollars to construct.
“Anything that’s loaded must be unloaded and taken to the job – sometimes piece by piece,” Kangas explained.
Many northern Alaska communities are limited to barge deliveries during a few summer months.
“Anything that misses these barge shipments must be flown in and at many times the cost,” Kangas said.

Distribution Technology
AIH began e-commerce 12 years ago and has already rebuilt it its website three times. They are now switching to software to provide a more robust search engine and allow customers to pick up orders from any of the AIH stores. The website even allows customers to order with their unique contract prices.
“We have some national competitors in Alaska that offer that same service, as do many of you, and to stand idly by, while giving up business to these competitors wasn’t an option for us, and shouldn’t be for anyone in this room today.”
AIH has grown to eight locations and 200 employees and a 100,000 sq ft distribution center.
In recent years AIH implemented an R-F scan system starting with inbound shipments, then added paperless order picking and now inventory management.
“Over those same years we have reduced manpower, increased productivity and improved accuracy, fill rates and inventory integrity,” Kangas reported.
He recalled participating in a trade conference rap session after AIH have given laptops to salespeople to check inventory, write orders and manage accounts from the field.
“I was dumbfounded to find that nobody else at my table was using computers in the field,” he remarked.
“A lot of us think of this as cutting edge, but, as I circle back to my grocery store days, it’s really not,” Kangas reflected. “It’s what every one of us needs, to survive these tough times and continue to prosper for many years to come.” ©2011/2012 Fastener Industry News
For information on permission to reuse or reprint this article please e-mail: FIN@GlobalFastenerNews.com

James Thompson founded  in 1959 in a Quonset hut on the corner of the Seward Highway and Fireweed Lane in Anchorage.

Related Links:

• STAFDA

• Alaska Industrial Hardware