Service Centers Add Valuable Services

Facing a manufacturing roadblock? Don’t have enough capacity for a project and don’t want to take on machine expenditures or the hassle to hire or retrain employees? The answer to these questions might be found at your local steel supply service center.


Machining of a thick plate. The company offers three grades of plate including carbon-steel, high yield low alloy, and a plate designed to withstand the pressure associated with boilers and tanks. Credit: Bushwick Metals.

Metal supply centers across the country and around the world are improving their processing capabilities. Not to compete with fabricator or machine-shop customers, but to offer technical expertise, which these shops may not have, using more capable equipment with greater capacity.

Machining to make more money is not new. The Pittsburgh Post Gazette in 1996 said that steel service centers have “evolved from simple distributors to complex technological wizards.” Recent quarterly earnings reports from large steel makers and suppliers have analyzed value-added services and showcased their importance. A November 2012 study on the future of manufacturing by the McKinsey Global Institute, the research arm of the management consulting firm, McKinsey & Company, found that value-added services is an important force to the global economy. The report, which did not specifically discuss service centers or metal fabrication, found that value-added services were of particular import to B2B manufacturing industries.


A plate-laser cutting machine is used for in-house stainless steel plate and sheet laser processing. Credit: Penn Stainless Products

As the definition of a steel service center morphs from a company with limited processing capabilities acting as the material middleman between large steel manufacturers and the fabrication shop, many companies are expanding their cutting, forming and other machining offerings.

Penn Stainless Products, a national and international supplier of specialty stainless steel, high-temperature stainless grades, corrosion resistant stainless grades and duplex materials, is one such service center that has eyed that market.

Jason Martineau, national sales manager for the Quakertown, Pa.-based company, said that these capabilities have evolved over time. “The ownership has been very diligent in reinvesting in the company, even during lean economic times,” he said. “We are a service center, that’s our forte obviously, but we wanted to grow and see what else we can do to a piece of metal to add value for our customers.”

Stewart Lichtman, executive vice president of Bushwick Metals LLC, Bridgeport, Ct., echoes these sentiments. The company, a distributor of carbon steel, high-strength low alloy materials and stainless steels, has also invested in sophisticated processing capabilities to meet their customer’s needs. These needs include challenging machining operations such as drilling, tapping, countersinking, and high-definition plasma cutting. For these customers, it might be more appropriate to outsource the job to a company such as Bushwick than do it in-house, said Lichtman. “Thee are some of the most difficult and time consuming processes for many of our customers to perform,” he said “We can now provide customers with very high-quality parts and fast turnaround times at a significant savings compared to doing these processes in-house.”

A sampling of services

A random survey of the Web sites of steel supply centers found that many, if not a majority, offer some value-added services. While some companies limit their value-adds to managerial and administrative functions such as just-in-time delivery and inventorying, many companies offer processes such as cutting with waterjets, lasers, plasma and more.

Penn Stainless, for instance, offer a litany of processing services for their customers. While the company’s customers may have in-house equipment, the equipment that Penn Stainless uses tend to be more specialized, suited to processing the stainless steel that they sell.

One such operation is the waterjet cutting station. The “dynamic waterjet,” from Flow International, counters stream lag and taper issues, according to the company. It can cut complex part geometry on stainless plates up to 8 in. thick. The company, which has 200,000 square feet of manufacturing and other space, runs four of these dynamic waterjet tables.

Another option is plasma cutting of stainless steel plate up to 6.25 in. thick with a 10 ft. by 65 ft. cutting environment. Two Koike Aronson Versagraph millennium series plasma-cutting systems operate on one shared rail system that allows for the lengthy cutting envelope. One benefit is a reduced bevel angle on the cut edge. According to the company, the system can achieve a 1° to 3° bevel angle compared to 7° to 10° with a standard plasma machine.


Large sheets of material can be cut with plasma cutting technology. Credit: Penn Stainless Products

Penn Stainless uses a Tanaka LMX VII 6Kw plate-laser cutting machine that can handle stainless steel sheets and plates up to 13 ft. by 60 ft. in size and with a maximum plate thickness of 1.25 in. Tolerances range from ±0.01 in. to ±0.035 in. depending on gauge. The laser is designed can cut heavy gauge plate to near-net shape (within 1/16 in.) allowing the customer to finish cut or weld a nearly completed component.

Martineau says that the waterjet and laser cutting operations are the two most used processes. Often, the more complex processes center around flat-roll plate and sheet products production. Some projects require multi-steps. “We may have leveling of the coil sides, taking a 25,000 lb. coil and cutting a very specific sheet and then send it over to the laser to have some geometry cut out of that part and then shipping it to the customer.”

Expanding its business

Bushwick Metals has been growing on multiple fronts. In terms of materials, it has expanded its available material through acquisition such as the 2012 Tarco Steel acquisition and the 2007 Koons Steel buyout.

On the processing side, the company has acquired new equipment to grow that side of its business. “We’re looking to expand and grow our value-added offerings,” Lichtman said. “The profit is in adding value to the products we sell. We can lower our prices and sell more metal out the door, but who wants to do that when you can make more money with value-added (processing)?”

One of their machines is a Peddinghaus HSFDB 2500 plate processor that is capable of drilling, tapping, countersinking, milling, scribing, and high-definition plasma cutting.

It offers plasma cutting of plates up to 1-1/4 in. thick and flame cutting of plates up to 6 in. thick. The machine incorporates a 10 ft. by 40 ft. downdraft table that the company says allows for cutting without using water. This results in a finished product that is cleaner with crisper cuts.

The company also offers plate rolling, punching, rebar fabrication, sheet/plate shearing and bending, beam cambering, and saw cutting.


Plasma Cutting Large size Plate and Sheet Credit: Penn Stainless Products

Difficult materials

Euipment such as these can cut complex and difficult to machine parts made from some of today’s toughest materials.

While many fabricators and machine shops know how to work with common stainless steels such as 304 and 316, other alloy compositions can be a struggle due to its mechanical and chemical compositions.

For instance, Duplex 2205 stainless steel is a 2-phase austenitic stainless steel with 22 percent chromium, 3 percent molybdenum, and about 5 percent nickel content. This provides high-yield strength, fatigue and corrosion resistance and other desirable properties. The trade-off is a difficult cut.

“If you look at Duplex 2205, the higher levels of chromium adds strength to the product,” said Martineau. “As the material becomes harder, it becomes more difficult to form. so all of a sudden somebody who could form ¼ in. 304 into various shapes suddenly realizes that they can’t do the same thing with the equipment they have because the Duplex material is almost twice a strong as some of the more common stainless steels.”

Collaborative efforts

With service centers increasing their processing capabilities, it is logical to wonder whether they have concerns about taking on work that might otherwise be performed by their customer.

If that is the case, however, they are not admitting to it. In fact, as the complexity of jobs and materials increase, Penn Stainless and Bushwick Metals often work with their customers to tackle difficult jobs and will employ them to perform services that they themselves cannot do. They become their customer’s customer.

Martineau said that when they sit down with a customer to look at a job, they ask questions and try and match capabilities. What are you doing with this piece of metal? What part of the job are you struggling with? What is the time horizon to have this project complete? These are just a few of the basic questions asked to better understand the job. “We are trying to match our capability, and where we don’t have the capability, we work with our partners,” he said. “To me, collaboration is a key word. Through working together, a lot of our customers end up being our vendors.”

Case in point is a pipe mill. “The mill buys plate from us to make its own pipe, and we give them a lot of work when one of our customers needs to have our plates converted into pipe,” Martineau said. “Because of our relationship, they have piping engineers who become our piping engineers.”

Lichtman also agreed there is often the need to combine the talents of other companies, including their customers. “If we are backed up or we have a specific process that we can’t do in-house, we’ll farm it out to our customers—a kind of virtual value-added to our customers.”

Lichtman says that there is a line. “The majority of our business is in construction, and we will never punch or drill holes in beams or do any type of welding,” he said. “Then you’re stepping on your customers toes.”

For videos about Bushwick’s capabilities, follow this link:

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