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International
Mold Steel adds value by providing
solutions to customers |
 BY
LAUREN DUENSING
August 2008
Reprinted with permission from
Modern Metals® and Trend
Publishing.
PRICE.
It’s the main buzzword in the service center industry— at least
among companies that sell commodity products.
The employees at
Florence, Ky.-based International Mold Steel, however, aren’t
concerned about price. They’re concerned about solutions.
“Everything we sell is more expensive than the products we compete
with,” says Thomas Schade, executive vice president. “We don’t
sell generic commodity products like D2 cold work die steel.”
The company’s history
goes all the way back to 1975, when Daido Steel Ltd., Nagoya,
Japan, introduced NAK55 to the Japanese and southeast Asian
plastics mold market. “It quickly became the most popular
pre-hardened mold steel in those markets,” says Schade. “NAK was
introduced to the North American market by MetalSource [an Alco
Standard Co.] in 1982. In 1986, Alco sold MetalSource to U.S.
Steel Supply Co.”
 In 1991,
the company was bankrupt, Schade notes. “At the time of the
bankruptcy, I was manager of marketing, specialty steels. Daido
asked how to keep the sales of NAK growing, and I sent a business
plan for IMS.”
International Mold
Steel opened a sales office in Houston in 1991 and moved to a
2,500-square-foot facility in Erlanger, Ky., in 1993 after Okaya
USA bought the majority ownership. “We built our current
30,000-square-foot facility and moved in June 1997,” Schade says.
“Here we carry all our own inventory and do all our own
processing. The original team consisted of four key MetalSource
employees: Paul Britton, who currently serves as national sales
manager, mold products; Russ Bowen, who spun off to his own
business four years ago, Molder’s World, which specializes in one
of our technical products, Porcerax; Ernie Beutel, who retired in
2003; and myself.”
Starting out,
International Mold Steel focused its attention on the plastic and
rubber mold markets. “We carried only pre-heat treated grades in
hardness ranges of HRC 29 to 33 and 38 to 42,” says Schade. “We
then approached the cold work die steel market in 2001 with a
single grade of steel,DC53, that outperforms most, if not all, the
generic grades, such as A2,D2 andM2. This grade has succeeded
because it has allowed customers to reduce die fabrication time,
extend die life and simplify their lives by only having to buy one
grade of steel.” The company is also involved in the aluminum die
cast market with Toolox 44 for general applications and “two
grades from Daido [DH21 andDH31-EX] that are used in specialized
applications requiring exceptional strength to avoid cracking.”
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In-house
knowledge
As the company grew, it discovered the most important part of
selling non-commodity mold and die steel is having the
knowledge to back up the product. “We sell on the service side
and get involved with the application,” says Britton. “We
don’t just take orders and sell steel—we sell mold and die
solutions.”
“We’re a
relatively small company in personnel so it’s important that
each person is technically up to speed,” says Schade. “In the
case of Paul, I’ll put him up against almost any rubber mold
engineer in the country. Nick Tarkany [national sales manager,
die products division] is the chairman of the tool and die
division of the Precision Metalforming Association, and,
again, when it comes to die design, I’ll put him up against
anyone in the country.” Another member of the staff with a
similar amount of expertise is Mike Buckley, sales engineer.
Schade notes, “He has years of experience designing plastic
injection molds, in addition to the hot-runner business.”
The inside sales
staff is equally knowledgeable. “Most companies’ philosophy is
that inside salespeople wait for the phone to ring and take
the order,” Schade says. “Eighty percent of the technical
questions that come in never get past Colleen and her inside
sales staff. They answer them, and they answer them
correctly.”
“We actually get
involved with the customer and get to know the customer and
the application,” says Colleen Corcoran, inside sales manager.
“That helps us to move the process along, but it also helps
our outside sales, as well as our managers, to be able to peg
that as an important call.” |
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INTERNATIONAL MOLD
STEEL’S INTERNATIONAL REACH MAKES ITS WEB SITE,
www.imsteel.com, an important resource for customers.
“We get inquiries from all over on a regular basis,”
says Thomas Schade, executive vice president. “A lot
of people lean on it as a technical resource.”
The company’s Web site
also sells solutions by offering discussion forums and
a technical center, which provides answers to commonly
asked questions. Paul Britton, national sales manager,
mold products division, says the discussion forums
“get a lot of hits and are very active. We try to
update them on a weekly basis. Most of the questions
are answered, and they seem to be well received.
“We don’t sell
commodities; we sell solutions,” he notes. “One of our
main solution drivers is the quality of our steel. We
try to teach people more about our steel. It’s a
learning experience for both our customers and us, and
that’s why we use the discussion forums that way.”
Since their inception, the
forums have been an informal place for customers to
learn more about International Mold Steel’s products.
That’s still the case, but recently the forums have
received an upgrade, in addition to better security.
“These forums are relatively new,” says Nick Tarkany,
national sales manager, die products division. “We’ve
been using them off and on, but we haven’t gone out
full-fledged to advertise them. We’re at the point now
where we’re ready to do that. Your questions are
welcome, the security is great and we’re moving
forward.” |
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The staff’s knowledge
is so comprehensive that many customers consider the employees to
be an extension of their own company. “Paul coined the phrase, ‘We
don’t sell steel; we sell mold and die solutions,’” says Schade.
“Our sales effort starts with engineers, and one of our first
questions is: What are your problems? We then set out to solve
those problems. Of course, our goal is to solve the problem with
the proper application of one of our steels. But more than once,
if there’s another company’s grade that’s more appropriate for a
particular situation, we’ll recommend the grade and the source to
the customer. In addition to the grade, we also will work on
hardness selection, machining and heat treating.”
“When a customer feels
that you’re an extension of their engineering staff, that’s high
praise,” says Britton. “There are times when a customer will call
us looking for a certain grade of steel, and we’ll send them in a
whole different direction.”
Britton says even if
International Mold Steel recommends a grade it doesn’t sell, the
customer “gets the information from us, they view us as the
resource and nine times out of 10, we’re the first phone call.”
 An
international reach
And those phone calls are coming in from around the world. The
company’s close partnership with Daido gives it a leg up on the
international market, but as Schade notes, “We can walk into any
international company and solve any problem with our steel. We’re
close with our European and Japanese distributors, and we’ll share
information with those international companies . . . If somebody
calls us and has a problem in China, we can have technical service
in the language the people understand in a matter of hours.”
Corcoran says the
company also receives “quite a few leads from Europe and India. We
either tackle that ourselves and ship from this location or we
have a European distributor that we work closely with. Between
those two, we’re extending ourselves in every direction.”
Another aspect of the
company’s international network comes through its partnerships.
“Daido is an equity partner in the company,” says Schade. “Our
relationship with SSAB [Oxelosund, Sweden] is rapidly becoming
closer than vendor-customer.” In addition, he says International
Mold Steel considers HE&M Saw a partner, as the company
exclusively uses its saws.
“As the volume forDC53
grew out of our capacity, we partnered with Alro Steel [Jackson,
Mich.] as our first, and largest, distributor,” he says. “The
customers in the territories they serve benefit from their
excellent service. We supply Alro with technical support. We’ve
entered into similar relationships with Lindquist Steels in New
England, Southern Tool Steel in the South, Hudson Metals in the
West and Titus Steel in Canada.”
Cost savings
International Mold Steel is always looking for the next solution,
whether through an engineering discovery or a new grade. “We
select grades that Daido produces that become popular in the
Japanese market because they dramatically outperform the generic
grades,” says Schade. “We test the machining, grinding and
polishing extensively, both in-house and with selected customers.
When we’re comfortable that the new grade, even though the initial
acquisition cost of the metal is somewhat higher than the grades
we compete with, will, through reduced machining and grinding time
and extended tool life, reduce our customers’ tooling cost per
part, we introduce the grade. The testing also allows us to be
technically proficient and fully capable of showing our customers
how to benefit from the unique features of the steel.”
Customers benefit from
a one-source supplier. “Our customers don’t have to worry about
inconsistent quality from multiple supplying mills,” Schade notes.
“We recently added our first two grades not produced by Daido.
They are Toolox 33 and Toolox 44, produced by SSAB. We put these
grades through the same extensive testing. When they surpassed our
expectations, we decided to carry them. Due to the unique manner
these steels are manufactured, only SSAB can make them. Again, we
have the advantage of single source reliability and quality.”
The quality of
International Mold Steel’s products can result in enormous cost
savings for customers. “We had a rubber mold customer that was
using a grade of stainless for his mold cavity plates,” says
Britton. “They were cracking and breaking just about every week,
and they were costing him about $3,000 per week to replace. We
switched him to a DC53, and he actually paid 10 percent more than
the 440 stainless.” Britton says that because the cavities stopped
breaking, the customer was able to use less rubber and hold
tighter tolerances, and his scrap went down. “Spending 10 percent
more on steel for that one part saved him $1.2 million in a year
in tooling and scrapped parts.”
 That’s
not the only customer who’s saved a bundle. Another replaced a
blade that was being imported from China with a DC53 blade with a
coating on it. “They were paying $186 for this blade, and we
charged them$415,” Britton notes. “They said, ‘Accounting is never
going to go for this.’ Their production cycle on the Chinese blade
was lasting two hours, and then the blade would be dull. Our blade
lasted six days. It ended up saving them about $53,000 per year in
blades.”
What customers learn
from working with International Mold Steel is that the up-front
cost of material doesn’t need to be the deciding factor. “The key
is teaching customers not just to look at variables A, B and C but
to look at A through Z,” says Tarkany. “Look at the starting cost
and the bottom line. Our steel will save money on the bottom
line.”
And that bottom line
is what matters to customers. “I had a customer tell me yesterday,
‘That’s the way we’ve done it for 80 years, and we need to
change,’” says Tarkany. And that customer has come to the right
place looking for a solution.
“We’ve found the
people that we end up doing the most business with are the
forward- thinking people, who are always looking for new and
better ways to do things,” says Schade. He notes that even in this
tough economy, “they’re all busy. The people who are beating their
heads against the wall saying, ‘We do it this way, we’ve always
done it this way, and we’re not about to change because we’re
comfortable’ are the people that are struggling.”
International Mold
Steel Inc., Florence, Ky.,
Tel: 800/625-6653,
Fax: 859/342-6006,
Eeb: www.imsteel.com
E-mail:
salesdesk@imsteel.com
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