Reliance Steel & Aluminum Co. is one of the largest metals service center companies in the United States. Through a network of more than 180 locations in 37 states, Belgium, Canada, China, South Korea and the United Kingdom, the Company provides value-added metals processing services and distributes a full line of more than 100,000 metal products. These products include galvanized, hot-rolled and cold-finished steel, stainless steel, aluminum, brass, copper, titanium and alloy steel sold to more than 125,000 customers in a broad range of industries. Some of these metals service centers provide processing services for specialty metals only.
The Company's primary business strategy is to enhance its operating results through strategic acquisitions and expansion of its existing operations. This strategy is driven in part by the continued growth and consolidation of the metals service center industry. The Company seeks businesses that are strategically positioned to diversify or enhance its customer base, product breadth and geographic coverage. The Company has successfully completed over 40 acquisitions since its 1994 IPO. Reliance is also expanding its facilities and product offerings in several of its existing geographic locations while penetrating new markets for its products.
Corporate History:
Reliance was founded in 1939 in Los Angeles, California and began as a fabricator of steel reinforcing bar. In subsequent years, the Company developed into a full-line distributor of steel and aluminum operating through a single metals service center located in Los Angeles. Through the 1960's, the Company expanded its operations via several acquisitions and the establishment of additional service centers.
In the mid-1970's, the Company began to establish specialty metals centers stocked with inventories of selected metals such as aluminum, stainless steel, brass and copper, and equipped with automated materials handling and precision cutting equipment.
Beginning in the early 1990's, owners of successful service center companies started to sell these companies as they were reaching retirement age. Reliance saw this as an opportunity to expand nationally in a more profitable manner than by expanding with Greenfield operations. This led Reliance to complete an IPO in 1994 to raise the funds to allow for that growth. Reliance has grown significantly through such acquisitions. The Company has completed more than 40 acquisitions since Reliance's initial public offering in 1994 and will continue to be an aggressive acquirer of companies.
Vision & Mission:
Reliance serves mission is to provide its customers primarily by providing quick delivery, metals processing and inventory management services. The Company purchases large quantities of metals from primary producers and sells these inventories in smaller quantities. The Company's primary business strategy is to enhance its operating results through strategic acquisitions and expansion of its existing operations. This strategy is driven in part by the continued growth and consolidation of the metals service center industry. The Company seeks businesses that are strategically positioned to diversify or enhance its customer base, product breadth and geographic coverage.
Forbes Rankings: Reliance Steel & Aluminum Co.
Strategy:
Corporate Office:
350, South Grand Avenue,
Suite 5100,
Los Angeles, California 90071
Phone (213)687-7700
Fax (213)687-8792
Areas of Working:
The Company provides value-added metals processing services and distributes a full line of more than 100,000 metal products. These products include galvanized, hot-rolled and cold-finished steel, stainless steel, aluminum, brass, copper, titanium and alloy steel sold to more than 125,000 customers in a broad range of industries. Some of these metals service centers provide processing services for specialty metals only.
Major products are:
Executive Management:
56 Years Old
David H. Hannah, Chairman of the Board and Chief Executive Officer
Effective October 17, 2007, David H. Hannah, currently Chief Executive Officer was elected to the additional role of Chairman of the Board. Mr. Hannah, 56, became Chief Executive Officer of Reliance in January 1999. He served as President from November 1995 to January 2002. Prior to that, he was appointed a Director in 1992 and had served as an Executive Vice President and as Chief Financial Officer since he joined Reliance in May 1981.
David H. Hannah, Chief Executive Officer, relinquished the title of President in January 2002. He became Chief Executive Officer of the Company in January 1999, in addition to being named President of the Company in November 1995. Prior to that, he was Executive Vice President and Chief Financial Officer from 1992 to 1995, Vice President and Chief Financial Officer from 1990 to 1992 and Vice President and Division Manager of the Los Angeles Reliance Steel Company division of the Company from July 1, 1989 to June 30, 1990. From January 1, 1987 to July 1, 1989, Mr. Hannah was Vice President and Chief Financial Officer of the Company, and from 1981 to 1987, was Chief Financial Officer. Mr. Hannah became a director of the Company in 1992. For eight years before joining the Company in 1981, Mr. Hannah, a certified public accountant, was employed by Ernst & Whinney in various professional staff positions.
Directors:
Impact of Reliance Steel & Aluminum Co. on Indian Industry
With the government's focus on the infrastructure and electrical sector along with India's growing importance as a global manufacturing hub for automobiles, infrastructure steel & aluminum domestic consumption is expected to grow by 9-10% in 2009-2010. With 10% of the world's total Steel & Aluminum resources India is self sufficient in steel & aluminum, combined with low power costs it has a competitive export market. So, till today Reliance Steel & Aluminum Co. have not much scope in Indian market because of robust growth in the Asian region, led by China has continued to drive the demand for steel & aluminum from Indian market. Demand from East Europe, South Asia and Africa has also contributed to a significant growth in demand of 7%.
Growth in power, construction, automotive and telecommunication sectors is expected to increase demand for steel & aluminum by 4-5% over the next couple of years. With low demand and high power costs in South America and Europe, copper miners are looking at India. The proximity to a high demand region and the low smelting costs has made India and other South East Asian counties increasingly attractive locations. With its primary use in the galvanizing of steel, the major users of zinc are the automobile and construction industries. India is presently a minor exporter of Steel & Aluminum, but with the expansion of new production capacity India is well on it's way in becoming self sufficient and will take a much larger role in international markets.
India's have potential in the global base Steel & Aluminum market and also it's growing appeal to international investors. Often compared to the dynamic growth rates in China, India has promised but failed to deliver the same. This conference will critically examine if India's recent developments will finally allow that promise to be successfully met.
So, it is cleared from the above mentioned facts that till today, India is self sufficient in steel & Aluminum, combined with low power costs it has a competitive export market & Reliance Steel & Aluminum Co. have not much scope in Indian market because of robust growth in Indian Steel & Aluminum market, but it have opportunities in future because of continuity in demand for steel & aluminum, because of robust growth in power, construction, automotive and telecommunication sectors in India.
SWOT Analysis:
SWOT Analysis, is a strategic planning tool used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a project or in a business venture. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieving that objective.
The aim of any SWOT analysis is to identify the key internal and external factors that are important to achieving the objective. SWOT analysis groups key pieces of information into two main categories:
The internal factors may be viewed as strengths or weaknesses depending upon their impact on the organizations objectives. What may represent strengths with respect to one objective may be weaknesses for another objective.
SWOT Analysis of Reliance Steel & Aluminum Co.
Strengths to Build Upon
Weaknesses to Overcome
Opportunities to Exploit
Threats to Overcome
Reasons for Growth of Reliance Steel & Aluminum Co.:
Favorable effect for Reliance Steel & Aluminum Co.:
Harm full effect for Reliance Steel & Aluminum Co.:
Conclusion:
Reliance Steel & Aluminum Co. is one of the largest metals service center companies in the United States. Through a network of more than 180 locations in 37 states and Belgium, Canada, China, South Korea and the United Kingdom, the Company provides value-added metals processing services and distributes a full line of over 100,000 metal products. The Company has a very diligent and disciplined acquisition strategy seeking immediately accretive acquisitions with a minimum return on investment, but if Reliance Steel & Aluminum Co. wants to operate in India, it has to compete with local robust players, which are not only fulfilling local Steel & Aluminum needs but also have potential to set them in Global Steel & Aluminum market with their techniques & cost efficiencies.
