Above: The SCS sheet line at Heidtman’s Butler Sheet Division.
As technology advances so does one service center’s strategy
September 2013 - When the recession hit full-on in 2008, many businesses found themselves in an uncertain position. Some were bought out while others closed their doors altogether. “We were fortunate to have an extremely strong balance sheet when the recession hit,” says Tim Berra, president at Heidtman Steel Products Inc., Toledo, Ohio. “We recovered quicker than a lot of other companies, and since the bottom have seen considerable growth. We’re back to where we were pre-recession and getting stronger.”
Heidtman Steel is well-known in the service center industry for marketing high strength, low alloy steels. Dating back to the mid-1970s and the days of the oil embargo, Heidtman invested in testing equipment to market steels to the automotive industry for weight reduction programs. “In those days, you either bought high-strength, low-alloy steel from us or from a mill,” says Mike Kruse, vice president of marketing. “Now as we’re moving into advanced high-strength steels, we want to be seen again as a leader and not playing catch-up in this market. We have a long-established reputation as high-strength experts, and we plan to build upon that with the advanced high-strength products. We know that a certain level of business will be provided directly by the mills, but there’s a significant amount of that business that will need to be provided by service centers. We plan to be the service center leader in that business.”
Heidtman already has run some advanced alloy, high-strength steels through its facilities. “As that occurs, we are making the necessary equipment and process modifications,” Kruse says. “We think we’re in a good position as we’ve already put in the research time and are already processing these metals. Our sales team and technical staff are also being trained in the application of AHSS so that we have a comprehensive approach to this market.”
Beyond the automotive industry, Heidtman is working toward becoming a steel solutions provider to several industries. In recent years, the company has been in the process of upgrading its equipment and it’s looking to expand its network of locations. “I think we realized after the recession that we needed to focus on the core business,” Berra says. As a result, the company is looking at four or five major new projects and is increasing current capabilities to support future growth and customer demand.
Rather than rushing into expansion, Heidtman is planning the timing carefully to ensure stability and success, Berra says. The company plans to have a presence in Monterrey, Mexico, in early 2014, extending its reach beyond the United States. Heidtman currently is supplying its Mexican customers from its existing domestic service center network, primarily from the Granite City, Ill., location. Heidtman also is looking at other opportunities in the southern United States, as well as expanding in the Midwest.
In 2007, Heidtman made significant upgrades to its Granite City pickling line. These included adding a tension leveler, an anti-coil break roll, Parsytec defect detection system, prewash upgrade and electrostatic oiler. The success of these upgrades was the catalyst to upgrade all the company’s pickling lines. For example, in 2011, the company upgraded its Cleveland pickling line, adding a Bradbury leveler to improve flatness and shape. Earlier this year, an anti-coil break unit also was installed in that line to address surface-critical applications.
Although the majority of upgrades during the last three to four years have been to its pickling lines, Heidtman also has upgraded several of its slitting lines to improve shape and surface quality. “Virtually all our pickle lines have in-line correction devices,” Berra says. “All pickle lines have automated inspection equipment in line and some of them have anti-coil breaking in line.”
Heidtman processes steel for a vast array of wheels used in several industries. “Producing wheels is an edge-critical and surface-critical product,” Berra says. “Out of Granite City alone, we process over 20,000 tons of steel a month for wheel rim applications for off-road, mining, on-road, military, agricultural—from very small rims for golf carts to rims for big mining equipment.”
Although about two-thirds of its business comes from various tiers in the automotive segment, Heidtman prides itself on serving a vast array of markets. Heidtman serves customers in truck and trailer, construction, metal buildings, HVAC, tanks, furniture, storage racks and fixtures, heavy equipment, and energy markets. “We’re very diversified, and each of those markets has its own quality and process requirements. As a steel solutions company, Heidtman brings six decades of manufacturing expertise coupled with its world-class mill suppliers to offer customers the best application for their needs,” Kruse adds.
Heidtman works with customers to address specific needs. “In the automotive industry, companies need light-weighting, sound and energy absorption, and stronger yet formable steels,” Berra says. “We are making sure that we have the ability to process those steels within tolerance requirements. By making changes such as upgrading horsepower on equipment, tightening tolerance abilities and changing how we inspect products, we’re able to come to the market with products that aren’t widely used yet.”
The company can begin producing products the market is asking for because its already has invested in the equipment to process, package and distribute these steels while meeting specification and quality expectations in the proposed delivery time frame.
One of Heidtman’s nonproduction facilities, located in Michigan, is particularly unique. The Automotive and Technical Center works closely with customers regarding advancements for the automotive industry but has always ventured into other markets. The facility houses the company’s team of metallurgists who work extensively with customers on testing and product development initiatives.
Understanding the products and the industry is an important factor for any business. To encourage employees to understand steel beyond their day-to-day jobs, Heidtman is offering an incentive program through its Heidtman Steel University called “Inside the Coil.”
Workers are encouraged to learn about processes beyond what their daily tasks require, including all processes, products and several facets of the broader steel market. The voluntary program is open to all employees.
“We’re building this in-house university to teach both steel basics as well as provide specific training,” Berra says. “We also bring in outside sources on a regular basis to educate employees.” Heidtman’s training strategy supports the company’s mission statement, which emphasizes its efforts to provide a safe, environmentally conscious workplace that promotes improvement.
In addition to its educational resources, Heidtman is invested in the long-term success of the company. “We’re privately owned,” Kruse says, adding the company is not held captive by a 90-day spread based on what’s going on with Wall Street. He credits the company’s lean management structure for making timely decisions based on a long-range approach.
“We won’t jeopardize our long-term strategy for short-term gain,” Berra says. “We see that from other companies all the time, who are forced to put undue emphasis on each quarter’s results. We might have a quarter here and there that isn’t ideal, but we realize it’s a short-term situation and we’re always looking long term. As a family-owned company, it’s a lot easier to focus on that.” MM
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