Steel Service Centers & Other Metal Wholesalers Industry Profile

Companies in the industry distribute steel and other primary metals and metal products, and may also provide sawing, shearing, bending, leveling, cleaning, and edging services. Major companies include Reliance Steel & Aluminum Co and Ryerson (both based in the US); as well as IMS France (France); Klöckner & Co (Germany); Russel Metals and Samuel, Son & Co (both based in Canada); and Stemcor (UK). Other companies include distribution arms of integrated manufacturers such as ArcelorMittal (Luxembourg) and ThyssenKrupp (Germany).

The US metals distribution industry includes about 9,400 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $200 billion. The industry includes metals service centers and companies that distribute metals other than steel, but not companies that distribute precious metals or metal ores.

COMPETITIVE LANDSCAPE

The health of the manufacturing and construction industries drives demand for steel. A distributor's sales volume determines profitability because many costs are fixed. Large distributors benefit from economies of scale in purchasing, processing, and distribution. Small companies can compete by specializing in particular products or offering special processing services. The US industry is concentrated: the 50 largest companies generate about 50% of revenue.

PRODUCTS, OPERATIONS & TECHNOLOGY

Steel products are made from carbon or alloy, stainless, or specialty steels, and come in the form of sheets, plates, bars, rods, tubes, and structural items like rails and I-beams. In addition to selling steel mill products, distributors sell various processing services ...