Tuesday | 28 August, 2012 | 4:21 pm

Tipping the scale

By Julie Sammarco

A bar supplier offers customized stocking programs to keep customers in the defense industry up to standard

August 2012 - “Today, companies who purchase bar can buy this material anywhere for about the same price with about the same delivery date, so what tips the scale?” asks Nancy Casey, purchasing manager for R&D Fasteners, Rancho Cucamonga, Calif.

“For us, it’s trust, reliability and reputation,” she says. R&D Fasteners manufactures nuts and hex bolts for the military, energy, construction and waterworks industries. Many of the company’s products are used in U.S. military vessels, such as naval submarines.

“We not only need our material to be on time and come with the proper standards for us to serve our industries, we want to be doing business with people who know the game and are willing to share their knowledge with us,” she continues. “If we don’t have that trust, chances are another company does, and we’re behind the competition because of it.”

R&D Fasteners buys nickel bar products from Midalloy Specialty Materials LLC, St. Louis, which began operating in 2005 as a sister company of Midalloy, a supplier of high-quality alloy welding products.

Midalloy Specialty Materials specializes in materials that can handle tough environments, according to Cliff Bailye, president of Midalloy Specialty Materials. The formation of the company was a natural progression, he says. As the market demanded more specialty-alloy bar and wire rod, Midalloy expanded to reach a growing consumer market.

“In the metals business, this is an important expanding segment, and Midalloy Specialty Materials grew quickly,” he says. “As industrial components are fabricated to be in more extreme environments—be it offshore oil and gas, energy generation, cryogenics for LNG production, or the myriad of present and future industries that need crucial alloys for demanding environments, Midalloy grew to support that need.”

Demand from these industries will keep growing. According to John McCue, vice chairman, U.S. Energy & Resources leader at Deloitte LLP, the economic downturn has sprouted a changing global energy environment. New opportunities in supply options have kept the energy sector alive and busy.

“Fortunately, the supply-side dynamics are undergoing dramatic change, as deep water offshore discoveries, shale gas/liquids, oil sands and a portfolio of renewable energy sources evolve to meet the changes in demand. Solving the equations to balance these changes in demand and supply requires appropriate infrastructure: pipe and transmission lines, power generation, smart technologies, energy-efficiency technologies, transportation infrastructure, gas/coal to liquids facilities, import/export terminals, pollution abatement investments, etc.,” McCue stated in the 2012 Outlook on Power & Utilities report.

Purchasing power

Midalloy’s locations in St. Louis and Houston offer customers specific stocking options that satisfy unique needs and alleviate the stress that comes with purchasing and stocking.

“Specific custom stocking programs are tailored towards each of our individual customer’s needs,” says Bailye. “It can encompass everything from a consigned inventory held at the customers’ location to weekly and bi-weekly shipments from one of Midalloy’s facilities. It can also include back-up stock along with pre-material held in the pipeline for quick deliveries to support growth at an individual customer.”

Often these programs help Midalloy’s customers feel more secure with purchasing.

“Customer-specific stocking projects for us are tremendous,” says Casey. “Our industries demand high-quality products, and they need to be able to depend on us. So we need to be dependable. When we can count on Midalloy to have exactly what we need every time, it’s nice. We never have to worry about it.”

“They have taken the initiative to learn our buying patterns and stock material accordingly,” says Laurie Lundin, purchasing manager for the 100-year-old Milwaukee Valve Co., New Berlin, Wis., a valve supplier for commercial and industrial applications as well as the U.S. Department of Defense and the U.S. Navy. The company’s components, machined from NI-CU 400 and 405 bar stock, are used for naval ships and landing docks. 

Casey and Lundin both appreciate Midalloy’s ability and willingness to share market news and information, which helps both companies make informed choices when purchasing bar products.

Casey says that Midalloy keeps its customers’ best interest at the forefront. “They share with me industry and market news and that’s worth a whole lot.”

Lundin agrees, pointing out, “The staff is very knowledgeable about copper and nickel market trends, and they share that market intelligence with us.”

“We offer our customers technical support as well as up-to-date market knowledge on supply and cost structures of the commodities such as nickel ore, which is the main element in each of the nickel and nickel alloys we offer,” says Bailye.

In it for the long run

When serving industries such as defense, material specifications are crucial and can be met by many bar producers. Prices are competitive, as well. “When you deal with the industries we do, you need to be on top of it,” says Casey. “Sometimes that extra edge makes a big difference.”

When suppliers become partners, the outcome often is positive. Long-term mutual interest and trust are two things keeping Midalloy connected to its customers.

“The programs we customize make Midalloy more than just a supplier but a true supply chain partner involved in all facets of our customers’ business. We not only look at supplying today’s needs and/or requirements but also anticipating tomorrow’s changing needs and requirements. Programs also take into account inventory control which has a direct effect on the financial aspects of the customer,” says Bailye.

“Honestly, material is material,” says Casey. “You deal with companies because of their reputation. Quality and reliability really defines Midalloy, and they really go out of their way to meet their customers’ needs. They think out of the box on how to help us, and that’s extremely appreciated. Our business relationship with them is very valuable because of all they can offer us.”  MM

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2016 End User Outlook

Although low pricing on metal products across the globe once inspired companies to stock up, there’s little appetite for risk peering into 2016.


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