I was communicating with the head of commercial for one of the domestic steel mills about the recent spate of price announcements and what they have managed to accomplish to date.
I was told, “Just another effort to get the momentum back to the other side. Partially successful if you ask me. Stops the erosion. Flattens the trend.”
This individual went on to say the announcements are not yet enough to make steel buyers buy more steel. At the same time, I was told mill salespeople have been told to stop saying “yes” to everything that is pitched to them. “This has had a positive effect in stopping bottom feeders,” is what I was told.
It could be 30 to 45 days before inventories tighten enough to get buyers into the market and paying up for steel, according to what I was told.
We will see what happens from there.
Earlier today, I reminded my son (he lives in Sweden) that tomorrow is my last day working and that I would be “evolving” (as Serena Williams would say) from the industry. His comment was, “Last day of work ever?! Impossible!”
After seeing me working over his entire life I can understand why he would react the way he did. He only knows his father as someone who worked long hours seven days a week. The idea of me stopping working is foreign to him. To be honest, the idea of not working every day has taken some time to evolve within me. Maybe his comment is one of the main reasons why it is time for me to stop working. I need to spend more time with my kids and with projects that enrich my life as opposed to my pocketbook.
When I was in college the last place I ever thought I would end up was the steel industry. I was quite certain that I would become a lawyer or a teacher. When I graduated from Hamline University in 1975 the economy was in shambles and I ended up in the restaurant business – something I had done in high school.
In retrospect, I was fortunate to have been fired from that job which, when coupled with other circumstances, led me to the door of Seymour Waldman, the owner of Rolled Steel Corporation.
I learned early the importance of having a mentor. In 1982 I joined Pacesetter Steel Service, Inc. out of Marietta, Georgia. Joining a prime galvanized house after spending five years selling secondary galvanized and cold rolled.
Selling prime steel was a big change for me. I struggled out of the gate. It wasn’t until I was called into Tom Penzone’s office and given an ultimatum to produce or walk that I reached out to Earl Goode to become my mentor. We lived in the same apartment complex, and we spent most of our waking hours talking steel and sales. He saved my career.
Based on my experience having a mentor was one of the reasons why I became successful. A mentor assists in the creation of a positive attitude and a willingness to learn something new. Sometimes, the mentor is nothing more than a sounding board as you work through an issue that is preventing you from reaching a goal.
I have told the story of Majestic Fireplace in the past. There was an older gentleman doing the purchasing at Majestic Fireplace and I was having zero luck in getting his attention. Earl Goode suggested FedExing the PA a quarter with a note saying the call was on us. That package separated us from all the other companies pounding on the purchasing agent’s door. The unique approach worked, and I was able to get my first order.
There is a lot more to this story that ended up becoming another learning lesson for me.
The order was for a load of slit galvanized coils that needed to deliver by the following morning. We took the order, interrupted our processing schedule, shipped the steel and that should be the end of the story… right? Wrong!
The following day I got to work to find a message on my desk to call the PA at Majestic Fireplace. The load had not been delivered. When I tracked down the load with our traffic department, we found out the truck had dumped the load on the side of the road about one mile from its destination. The PA didn’t believe me, so he got in his car to see if the load was indeed in the ditch.
About 30 minutes later he called me back and asked if we could reproduce the load and get it to him by the following morning. We interrupted our processing schedule, slit the steel on the night shift, shipped the load and that should be the end of the story… right? Wrong!
The following morning, I went to work early. Instead of waiting for a call, I called the PA first and asked if the load had been received. He had not yet checked so he asked if he could call me back.
The return call was not what either of us expected. The truck was backing into their loading dock and broke an axle ten feet from the dock.
Pacesetter managed to bring in a piece of equipment to unload the truck and get it inside the customer’s plant.
Majestic Fireplace ended up being a long-term customer because we were honest, transparent and committed to servicing their business. We had an opportunity to prove ourselves on the first order and we came through with flying colors.
The quarter and the cost of the FedExed package were money well spent.
This one order had a profound impact on me and my sales career. It taught me to push my ego aside to ask for help from my mentor. I followed through with his suggestion. When the opportunity for an order arose, I seized it. I was honest, transparent, and proactive throughout the process, and the company I represented was committed to servicing the customer despite the challenges.
Perhaps you have a similar story. Don’t be afraid to share it with your prospects or your first-time customers. Sometimes your greatest successes come from what was initially a perceived failure.
Steel Market Update began as a way for me to assist steel buyers to look at a bigger world. The steel industry had become an international business. China had begun to suck up all the commodities, and then export whatever excesses they produced. In 2004 when I first started writing the newsletter, many buyers were only worried about today’s steel price and their next delivery.
The world around them had become much more complicated.
As I look at the steel industry today, I think back on the many mills that went out of business or were acquired by other companies. I think about all the technical improvements from EAFs to continuous casters, and the refinement of steel’s chemistry.
I also think about the revolution we are seeing in the industry today as electric vehicles take to the streets, the power grid is changing, addressing climate change is taking hold, and the US steel industry is at the forefront. As Paul Lowrey said during the 2022 SMU Steel Summit Conference, “It is a great time to be in the steel industry.”
As always, your business is truly appreciated by all of us associated with Steel Market Update.
John Packard, Founder
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