Customers, suppliers and employees are key elements to success

BY MARY JO MARTIN

Editorial director

Service Metal Products founder John C. Seitz came into this industry after getting his start in a very unique trade -- a beer brewer. But as infrastructure and manufacturing construction and repair took off following World War II, Seitz became acquainted with several people who were connected to the pvf industry. In 1954, after recognizing that there was a need in the Midwest for these products, Seitz formed Service Metal Products in St. Louis. 

Times were tough, however, and money was tight, so Seitz worked at Service Metal Products by day and toiled nights as a beer brewer. His youngest daughter, Cynthia Seitz Hammersmith, remembered how her father sacrificed to support his family, averaging only three to four hours of sleep a day.

Beginning in the early 1960s, Seitz began to be joined in the business by his sons-in-law. First came John Nicholson, then Bob Hammersmith in 1970 and Bosco Westrich in 1971. Despite the additional manpower, there were still challenges to growing the business. In fact, Bob Hammersmith recalled the cautionary -- but motivational -- words of his father-in-law:

“This company can support one family comfortably, but now we have to support four families. What are you guys going to do?” 

This signaled the beginning of changes that were designed to take the master distributor to the next level. During the early years, Seitz had built up his inventory by purchasing surplus material, as well as buying product from other master distributors. As business grew, Service Metal Products eliminated surplus items from its stock, and all products were purchased directly from the manufacturer with full traceability.

Solid management team

Following Seitz’s death in 1979, his three daughters and their husbands purchased the business and continued the growth Seitz had envisioned.

On a return flight from visiting suppliers overseas, Cynthia and Bob Hammersmith discussed the possibility of opening another branch.  After much deliberation, ownership decided on Charlotte, N.C., and in the fall of 1980, Service Metal of the Carolinas was formed. Five years later, Ken Gebhardt was transferred from the St. Louis operation to the Charlotte office as branch manager. He made Charlotte his home and has been an essential part of Service Metal’s success and growth, while servicing the Eastern U.S.

During that period, Patricia and John Nicholson retired to California, leaving the remaining two couples to continue the family business. They have been ably assisted by Jim Fears, who was hired in 1995 and soon after became general manager.

“He has helped the company reach new heights,” said Bob Hammersmith. “He and our family truly believe in the same work ethic of Mr. Seitz, which is superior service to all customers and best pricing in the old family tradition.”

Yet more changes have come since 2000. Priscilla and Bosco Westrich retired, leaving Bob Hammersmith as president of Service Metal Products and Service Metal of the Carolinas. In keeping family tradition alive, his daughters and son-in-law -- Stefanie Hammersmith Dunlop, Kristopher Dunlop, CPA, and Christina Hammersmith Williamson -- soon joined the company.

“They are able to bring another dimension to the team,” Bob noted. “We also attribute much of our growth and success to the knowledgeable inside sales team, office personnel and warehouse staff. They have been, and always will be, an essential part of Service Metal’s business.” 

Today, Service Metal has more than 40 employees, and offers a long list of products, including:

• Carbon steel weld fittings and flanges
• Forged steel fittings
• Forged steel outlets
• Cast iron flanged fittings and flanges
• Malleable iron pipe fittings
• Merchant couplings
• Steel pipe nipples
• Bolt paks
• Crane cast steel valves
• Crane cast iron valves
• Crane bronze valves
• Williams cast steel valves
• Hammond cast iron valves
• Smith forged steel valves
• Fortune ball valves
• Sureflow Y-strainers
• St&h butterfly valves
• Center Line butterfly valves
• Duo-Chek valves
• Flowseal high-performance butterfly valves.

“We have many long-term employees who have been trained as our product lines and business have grown through the years,” Bob noted. “When job openings arise, Service Metal always tries to promote within the company to allow our employees to expand the product knowledge they have already accumulated. Our employees have benefited from the growth of our company; it has given them the ability to learn more about our product lines so we can better service our customers. We are fortunate to have employees that have the experience to keep our inventory diversified enough to handle all of our customers’ requirements.”

Building supplier relationships

It is critical for a business such as Service Metal to have solid supplier relationships. As Jim Fears noted, the company has maintained relationships with some of its suppliers for more than 30 years. As a master distributor, customers come to Service Metal with varying needs, including stock orders, large projects or as a fill-in supplier. As a result, Service Metal has had to build its inventory to support all different types of requirements.  In fact, the company’s inventory continues to expand on a daily basis.

“Our suppliers deserve a tremendous amount of credit for our success,” Jim said. “Without these relationships, we would not have been able to grow our business to where it is today.

“There are some key factors involved when evaluating our suppliers. As a master distributor, we have to look at where the manufacturer is located and evaluate how fast we can get material from that source. We also look to see if there is an opportunity for exclusive territories. Of course price is a large factor, but we must also weigh if that manufacturer can deliver the products and services it promotes. Suppliers are reviewed on their overall philosophy. Service Metal has always maintained a service first philosophy and our suppliers are a branch of our business. We want our suppliers to instill in their workforce the same service orientation that we uphold.”

Careful discernment is also needed when evaluating new products.

“We try to first look at how that new product would fit into our current product offering,” Jim explained. “Is it a complimentary item that goes along with an item we currently stock? Could this new product give us an opportunity to get new business from our existing customers? As a master distributor, we want to position ourselves as a warehouse that holds congruent parts to better cross-sell. We are one of the only master distributors in the country that can give our customers the ability to order from such an extensive inventory of products all in one location.”

Customer loyalty

Over the years, Service Metal has primarily relied on word of mouth referrals from customers to gain new business. As a master distributor, they do not sell to the end user; the company’s focus has always been on industrial plumbing and pvf supply houses throughout the U.S.

“Providing our customers with excellent service has enhanced our reputation throughout the marketplace,” Jim commented. “We also send out monthly fax mailings and use various print advertisements, such as brochures, mailers and postcards. We utilize independent sales reps that call on customers in certain geographic territories. As technology continues to become a larger part of our industry, we took the time to develop one of the best websites in our industry,  www.servicemetal.net.  On the website, customers can obtain general background information, product information, price sheets and specification sheets for most of our products.”

Of course, one of the key elements required for a master distributor is timely, accurate shipping of product. This can only be accomplished when an organization has a tremendous team in its warehouse. And Service Metal certainly does.

“Our warehouse staff is really the backbone of our company,” Jim explained. “We have successfully moved into larger facilities three times in the past five years with little effect on our customers. Our staff has been able to continue to improve our warehouse layout and efficiency while servicing our customers on a daily basis. They are an experienced warehouse staff that shares the common philosophy of providing superior service. Their packaging, order accuracy, quick shipments and courteous service are all an important part of what makes Service Metal unique.”

So, because of the nature of the business of master distribution, do customer relationships differ from those in traditional wholesaling?

“Customer relationships are critical in any business,” Bob noted. “Customers are always looking for the best price and availability. With the large amount of competition in our industry, Service Metal has tried to differentiate itself by providing our customers with a level of service that keeps them coming back. Our customers trust us and, therefore, a large portion of our sales are from repeat customers. We work to be consistent in every aspect of our business, so our customers feel comfortable and confident when they place their orders that Service Metal will efficiently get the job done.”

With today’s customers being more demanding -- and knowledgeable -- than ever, Service Metal places a large emphasis on what is termed the company’s “superior service.” With no orders considered too big or too small, Service Metal does not have minimum order or broken box charges. Their large variety of products and services allows customers to package many items together in one purchase and save money on freight.

“This was the thought behind our slogan ‘One Call Gets It All,’” Jim said. “Our customers will also call on our experienced staff to help locate ‘specialty’ items. In addition, we are often asked to hold material for a certain ship date or to package and tag material a certain way. We try to ship every order the same day and will provide mill test reports --which are now required by most of our customers -- at no extra cost.”

In addition to the mill test reports, another value-added service the company offers is the ability to do some modifications to weld fittings and flanges in its machine shop.

Of course the roller coaster of metal prices has affected many in the pvf industry, and Service Metal is no exception. They have primarily been stung by rising steel prices, and despite trying to keep pricing as consistent as possible for customers, they have to pass along some of these increases.

“We make it our priority to communicate with our customers and give them ample notification regarding future increases,” Jim explained. “We are not sure when the market for steel is going to level out, but we will try to protect our customers as much as possible.”

Bob Hammersmith -- and the entire team at Service Metal -- are confident in the future of master distribution. Over the past years, Service Metal has experienced tremendous growth, thanks in large part to the addition of new product lines and the company’s new, larger facilities. And they plan to continue evolving and changing in positive ways that will build on their already strong customer relationships.

“Our role as a master distributor will become even more important in future years because so much of the manufacturing process has moved outside of the U.S.,” said Bob. “Due to the increasing demand of our products, our customers need a reliable and fast source for their everyday stock and project requirements. With the cost of labor, transportation and raw materials increasing on a daily basis, a master distributor such as Service Metal can reduce a tremendous amount of time and cost to our customers. Our extensive product line can benefit our customers by supplying them with a large product offering from one location, reducing freight charges they would have incurred by using multiple vendors.”

“We are going to continue to grow our company with the same philosophies that have been successful for us for the past 50+ years. Service Metal was founded by a great man, John C. Seitz, who was willing to sacrifice to make our world a better place.  As a member of the ‘Greatest Generation,’ he was a simple man and would never have imagined that not just his children but also his grandchildren would still be carrying on his dream.  How proud he would be!”