Originally founded in 1945 as South-western Ohio Steel Metals, SOS Metals, Inc. specializes in the processing and distribution of flat-rolled steel products using such methods as advanced slitting, multi-blanking shearing, and tension leveling. In its early days, it did a lot of business in the excess prime and not-ready-for-prime-time steels. However, SOS Metals went through a big change from 1992 to 1993 when it made the move to being a prime house and shifted its business dramatically toward contract business buying prime steel from the mills for higher end applications.
Today, SOS Metals, Inc. is a major player in the steel producing market and a subsidiary of Marubeni-Itochu Steel, Inc. of Tokyo, Japan, which exports, imports, manufactures, processes, and sells steel products. The company’s other business includes the development of supply chain management systems for steel production. Marubeni-Itochu Steel is a joint venture of the Marubeni Corporation and Itochu Corporation with each owning 50 percent of the enterprise.
Gone are the days of the steel industry’s multi-level, multi-year contracts. With the high volatility introduced into the market in 2004, pricing is getting done on a 90-day or six month basis instead of two to three year contracts. SOS credits its parent company’s support and adaptability with its success and survival during challenging times.
“International ownership is definitely one of our strengths,” says SOS Metals president, Jim Banker. “Our parent company has a worldwide touch and presence.
While we have a very good perspective of what’s going on in the Eastern United States, our parent company offers us the opportunity to keep up with what’s going on worldwide and be aware of, stay ahead of and get ahead of some of the trends. It offers us global reach with access to the best worldwide prices and the expertise to import steel when it’s advantageous for our customers. Our longevity and strength is largely based on our ownership by these two companies and in today’s market, that kind of support is crucial to continued growth.”
SOS Metals’ wide customer base includes the heating, ventilation and air conditioning business the appliance business, and other general manufacturing customers that value quality and service. SOS also supplies tier one and tier two automotive part producers in addition to processing steel for its parent company, Marubeni-Itochu Steel, Inc. “When you add in the work we do for Marubeni-Itochu, we cover all of the major steel markets – carbon steel, stainless, but our main area is carbon flat roll,” says Banker.
SOS Metal’s headquarters are located in West Chester, Ohio in suburban Cincinnati and employs nearly 300. The SOS service center processes over 500,000 tons of steel each year for critical demanding applications at its three production facilities in Ohio and Tennessee. In addition to its West Chester headquarters the company has three other facilities located in Middletown, Ohio, Lawrenceburg, Tenn., and Portland Tenn.. The Portland facility is SOS Metal’s latest acquisition and its 100,000 square feet of manufacturing space is used for SOS’s slitter processes. The company has eight slitting machines company wide.
SOS offers a full line of flat-rolled products and can process them on the most efficient technologically advanced slitting, multi-blanking shearing, and tension leveling lines available. It also offers commercial testing and metallurgical support. Its operations focus on the particular needs of its clients while meeting the critical demands of this highly competitive industry. Products produced include aluminum, aluminized steel, cold rolled steel, electrogalvanized and galvanized steel, galvanneal, hot rolled P&O, prepainted steel, and stainless steel.
SOS makes upgrades continually in its plants. The installation of a multi-balancing machine was made in 2000 and custom blanking and multi-blanking equipment was added at its new facility in Tennessee. Its Middleton facility, known as Blue Sky, houses a new high-speed slitter. In addition, SOS’ leveling line facility has been upgraded continually since the mid 1990’s. The plant does a variety of work for the steel and aluminum industries, including cleaning and re-oiling in addition to leveling . “It allows us to go across a lot of industry lines and provide products to a variety of clientele,” says Banker.
“SOS is a new kind of partner for the business environment of today, providing the quality customers need to be competitive, the service they need to remain effective and we offer expanded capabilities to meet all of our customers needs. SOS is a privileged partner for customers who demand quality, service, and advanced capabilities to achieve excellent results,” says Banker.
Weathering the Market
At every step of the process SOS imposes a high level of procedural management to ensure customer satisfaction. “Commitment to total quality means understanding our customers’ requirements to guarantee top-quality, just-in-time processed metal products,” says Banker. “We’re an intermediate processor. We have to be very adaptable to our customers. Our ability to grow and adapt to the changing market conditions is so important. It keeps us competitive.”
A major trend in the steel business has been the consolidation of raw material on the supplier side and consolidation on the customer side. “Until recently, the service center industry hasn’t felt the trend of consolidation as so many other industries have. But now our turn is coming,” says Mike Jansen, senior vice president and chief financial officer for SOS for the past 22 years. “As we look ahead, it’s more than probable that we’re the next industry that will have to answer to this trend. Our big focus is as a regional player, stressing quality and serving our customer base. Our business is changing and getting back on a growth track. We’re doing that by stressing our capabilities, focusing on custom processing and outside processing, and a lot more supply chain management.”
From the materials side, demand for quality is relentless. “There is an intense emphasis on quality and we have to continually stay abreast of this aspect of business. The trend toward high tencile, high strength steel is not going to change. Our customers want more parts per linear foot and we have to deliver,” says Banker.
In addition to the demand for high strength steel so prevalent in the market, SOS Metals sees a lot of development in the painted steel market. Twenty-five percent of its current business is prepainted steel. This product has a variety of applications including metal buildings, garage doors, residential doors, and heating and air conditioning units.
Despite a highly competitive market, SOS Metals credits its people rather than technology when it comes to its success. ” I think its not so much technology and products but the people who run them that makes for a successful company that can weather the hard times. It’s how the people you have running the equipment and managing the business that makes the difference. It’s their commitment to quality and safety and outstanding customer service. That’s what separates us from other service centers.”