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Steel service

Nilanjan Dey

TATA RYERSON Ltd, a steel service centre, is seeking to emerge as a solutions provider to customers, covering materials as diverse as plastics, pipes, bearings and agri-implements.

The company, a 50:50 joint venture between Tata Steel and Ryerson-Tull of the USA, is looking forward to service select clients in a number of non-traditional areas.

Incidentally, Ryerson is the frontline player in the steel processing and distribution business in the US. It is also among the largest buyers of steel, figuring alongside giants such as General Motors and Ford.

``Sourcing of materials such as pipes through a service centre will provide a customer with certain benefits,'' says Mr R.I. Singh, Chief,Business Unit, TRL, ``as it will be enable the procurement of these materials in the optimum form and at the most ap propriate time.''

``Ideally, we would like to extend our reach to cover new industrial materials. There is enormous scope of such services in India,'' Mr Singh states. Among the services that can be offered are customised processing and packaging as well as technical sup port.

For the customer, this will translate into lower costs through more pragmatic inventory management and better production planning. Cost efficiency will also happens because of standardisation, process elimination and improved finish. Further, there will be reduced scrap loss through customised inspection services. At the end of the day, these benefits can be passed on to other end-users.

Steel service centres, it is explained, provide a significant link between manufacturers and consumers of steel. A typical service centre processes and sells steel to finished products makers. Customisation, therefore, is the key element in the entire se rvice centre operations.

Internationally, service centres account for a good proportion of steel purchases. In India, however, this is still a marginal phenomenon -- a fact that TRL feels should be appreciated by both steel producers and finished products manufacturers.

As for its core business, TRL is putting up a new Rs 40-crore expansion project in Jamshedpur. The new unit, which will substantially add to the company's processing capacity, is likely to cater primarily to the auto sector. The project -- slated to go o n stream in early December -- is expected to strengthen the company's ties with Tata Steel.

Networking is currently a vital issue for the company, Mr Singh observes. The expansion venture, in fact, will buttress the company's plan to cater to the emerging needs of the trade channels.

``TRL,'' Mr Singh says, ``is trying to play a role in the distributorship business in states like Haryana and Chhatisgarh. The company, it is pointed out, has widened its reach to cover certain furniture makers as well!''

The Steel City, in fact, is the hub for TRL, thanks to the hot rolled coil processing facility that was set up here in 1997. A second centre was started in Pune in 1999. Both units have slitting, cutting-to-length and corrugating facilities. More recentl y, warehousing and distribution operations were initiated in Kolkata and Faridabad.

Currently the company caters to, among others, tube makers (the parent group itself is in this business) and auto majors like Telco. In the latter category are the likes of Maruti Udyog, Mahindra & Mahindra and Fiat. These customers, as well as others, a re serviced through computerised systems, featuring automated order entries and updates, shipping schedules, invoicing and payment acknowledgement.