Visions - Spring/Summer 2013 - (Page 12)

TUBULAR – LINE PIPE AND SPECIALTY TUBE Midstream and Downstream Services Business Serve Line Pipe & Specialty Tube Demands C urrently, SCOA’s Tubular Group Midstream and Downstream Services (MDSS) Unit consists of two business components: 1) our traditional trade business focused on the supply of line pipe and specialty tube products to retail distributors, and 2) management of our subsidiary company Global Stainless Supply (GSS). GSS is a master distributor or “wholesaler” of pipe, flanges and fittings (PFF), primarily to the mid- and downstream energy markets as well as the general industrial market. As a provider of critical products, our internal supply chain becomes an integral component of our customers overall supply chain and ultimately their customers supply chain. Management of all of these supply chain components, including inventory control and logistics, is essential to insuring we meet our customers’ needs. Regarding specific supply chain management services, we offer, in our traditional trade business model, coordination of inbound logistics and delivery of the material from the manufacturer to the customer; quality and cost competitiveness of logistics are critical to meeting our customers’ requirements at a competitive price. Additionally, in certain cases, we have taken an inventory position in support of a customer’s business; as such inventory control is critical to protect our assets. Our customer base for the MDSS unit – served directly – and through our subsidiary Global Stainless Supply (GSS) are retail distributors who then ultimately sell the products to the end users including fabricators; engineering, procurement and construction (EPC) contractors; and energy companies. GSS has an active customer list of over 500 customers ranging from large national distributors to smaller regional distributors and local “mom and pop” distributors. We believe the mid- and downstream markets will continue to grow at a moderate pace, while also proving less volatile than the upstream market, and as such, we would like to continue to grow our trade business and GSS through both geographic and product line expansion. Both entities, SCOA and GSS have longstanding supply relationships with major world class manufacturers of pipe, flanges, and fittings at multiple levels of quality and price points. On the customer side, relationships spanning more than 30 years exist with key customers Pioneer Pipe and Rob Roy Industries. Over time, these relationships have evolved from product supply into strategic partnerships with shared risks and rewards. These relationships have been able to endure for more than 30 years due in large part to both companies’ commitment to the relationship, and a willingness to continually modify the relationship to meet changing market dynamics and to highlight the strengths of each organization. GSS, through its line pipe business division Global Pipe Supply (GPS), will continue to gain market share in the rapidly growing midstream line pipe market segment. GPS recently opened a 60-acre pipe yard in east Houston to better service our customer base, resulting in increased sales, and we will continue to support our retail distributors with existing and new product sources. 12 v i s i o n s S p r i n g | S u m m e r 2 0 1 3 The business model for GSS is as a master distributor of pipe, flanges & fittings (PFF) products and in that role, GSS serves as the buffer in the supply chain between the manufacturers (whose delivery time can vary) and the retail distributors (whose demand forecasts will always have a certain margin of error). Sometimes, a distributor’s need for materials cannot be provided directly from the manufacturer and GSS can fulfill their needs. Ancillary services that GSS provides include: • Consolidation of multiple types of products in small quantities to support one customer order. • “Will call” material availability with pickup being available within hours of order placement. • Modification of material to meet customer specifications, such as cutting of pipe to length, and machining of parts to customer specifications.

Table of Contents for the Digital Edition of Visions - Spring/Summer 2013

Visions - Spring/Summer 2013
Contents
Meet our New President and CEO Kazuhiro Takeuchi
Bringing Global Expertise and Foresight to Tubular Market
Our Subsidiary OCTG Distribution Companies Earn Biggest Market Share
SCOA Teams Up with HOWCO for Oil Field Materials and More
SCGTS Creates Value Through Service Integration
Midstream and Downstream Services Business Serve Line Pipe & Specialty Tube Demands
Management Synergy & Coordination Helps Our New Oil & Gas Working Group Put All The Pieces Together
Shale Gas and Tight Oil Projects Look to the Future
NSI Crankshaft Finds New Business In Oil and Gas Exploration
Steel and Non-Ferrous Metal Group Supplies Offshore Drilling Operations
Unique Machine Prospers in Alaska
Construction Equipment Business Serves Oil Sand Project Needs
Pacific Summit Energy Experiences Energy Trading and Marketing Success
Analysis and Prevention are the Keys to Success for Tubular HSE

Visions - Spring/Summer 2013