In the ever-evolving world of master distribution, anything a company can do to gain efficiencies can be a game-changer.
The Global Group of Companies is ready to do some serious game-changing.
The Houston-headquartered master distributor, which includes Global Stainless Supply, Global Pipe Supply and Forgings, Flanges and Fittings under its corporate umbrella, has made advancements in recent months it feels will further separate it from the pack in the ultra-competitive industrial pipe, valves and fittings market. Global is the only U.S.-based master distributor of pipe, flanges and fittings in carbon, stainless, chrome, low-temp and low-chrome alloy.
“We’re always working on something new,” says Global President and COO Art Shelton, sitting in the conference room of the company’s Houston headquarters earlier this summer.
Pipe dream comes true
Global’s biggest advancement sits on 62 acres of land in the eastern part of Houston. The company opened a new nearly 3 million-sq.-ft. pipe yard last November. It became fully functional in May 2013.
“This yard is state-of-the-art, top-shelf stuff,” Global Senior Vice President and FFF Division Leader Stan Lee says. “It will make us a service leader in this industry.”
On a recent late summer and oddly cool Houston day, trucks were lined up to receive deliveries at the new facility. A short distance away a forklift worked hard retrieving pipe to fill an order. Global executives say the new yard will further aid the company in one of its core competencies — superior customer service. “We’re significantly focused on the customer,” Shelton says.
Previously, Global was processing orders out of three storage facilities and another leased 140,000-sq.-ft. warehouse in Houston that stored large OD and fittings. Now, everything sits on one massive parcel of land that could accommodate about 50 football fields. The new yard also features cutting and beveling capabilities up to 24 in., and threading through 4 1/2 in.
“In the pipe business, you have to get guys in and out. It’s all about service,” Shelton says. “We want to get customers in and out of the pipe yard in less than an hour.”
Global Vice President of Carbon Pipe Mike Chambers chimes in during the conversation that the load-time average the previous day was just 51 minutes. “That’s loading the trucks and doing the paperwork,” Chambers points out.
Lee adds: “We’re always tracking that kind of thing. The average in the industry is several hours.”
Shelton notes the company also went to great lengths to ensure safety is a top priority throughout the massive facility. Pipe is stored on special racking systems akin to football goalposts to further foster a safe working environment. Shelton adds the company wants to lower its TIR (total incidents reported) down to zero. He says the industry average is four.
“It can be done in this industry,” he says. “We are very health- and safety-oriented. Pipe yards can be extremely dangerous. Anything we can do to make it safer is money well-invested. We have a full-time safety manager and we report near misses. We all get involved in safety meetings. The only way to improve it is to live it.”
PVF super center
Global’s other major news in 2013 was its announcement of becoming a US Steel distributor — a huge feather in the cap for the company, which has other locations in Los Angeles; Indianapolis; Richmond, Va.; Atlanta (sales) and Mobile, Ala. (sales) and features 1 million sq. ft. under roof and about 90 acres of total pipe yard space. A warehouse facility in Atlanta is slated to open in the near future.
“US Steel is big for us,” Shelton says. “We’ve been building our pipe inventory through 48 in. The US Steel move allows us to capture more jobs in carbon and stainless pipe, flanges and fittings.”
Lee adds: “It’s helped us leverage some of the larger jobs because we’re very competitive on the price side.”
The US Steel deal further strengthens another one of Global’s main focuses — being the all-inclusive source for a customer’s pipe, fitting and flange needs.
“With us they can pick up all their materials in one stop,” Lee says. “Their clients are depending on them. Bigger distributors are downsizing inventories and need to fulfill the requirements they have. We can get it to a customer in one day. We are unique in that way.”
Global Senior Vice President Danny Lee adds: “If you have pipe, it’s easy to bundle the three products together.”
Global goes to great lengths to ensure the material it is selling meets the highest quality levels. The company recently hired John Hunter as manager of quality assurance. “We check the integrity of all suppliers,” Shelton says. “That’s our policy and it will never change. John has been a great addition for us.”
Stan Lee notes third-party testing helps in that quality-control process. “We put that quality in writing. The process here matters,” he says. “Having a suitable supply is something we take very seriously. We want to make sure we are stocking the best possible quality product that not many people have. We have a dedicated quality-control staff and we work with quality vendors. It’s an ongoing process to maintain that integrity.”
Shelton stresses the other key piece to Global’s success puzzle is the way it treats people. “We take care of everybody who comes through here,” he says. And that holds true whether the person is on Global’s 300-employee roster or pulling a large flatbed into the new pipe yard to pick up an order.
“There are a lot of hotshot drivers (picking up product and delivering direct to a jobsite) in Houston that come here,” Danny Lee says. “Their feedback to their customer is critical because their customer could be one of our large customers. Internal and external customers are all the same to us. We treat everybody around here with the same respect.”
Stan Lee says investing in the company’s workforce has helped Global grow to where it is today.
“We can buy a building and put steel in it, but that’s not what we’re after,” he says. “Without exception, it comes back to people. We have people who have been with us for a long time and have grown with us. It’s a testament to how important the right people are.”
With major momentum on its side, Global’s plans for the immediate future include continuing to focus on the successes that got it to this point. And that means continuing its long-standing policy of selling only through distribution.
“With master distribution there is the temptation and idea out there to get into serving the end user,” Danny Lee says. “That’s not anything we want to entertain. It’s very important that we sell only through distribution.”
Stan Lee believes the role of the master distributor, especially in the industrial PVF sector, will only continue to become more prominent in the years ahead.
“As more companies are pressed for inventory, turns will be more and more difficult for distributors,” he says. “We have the inventories and that makes our position in the industry even more important. As lead times become larger, the role of the master becomes more important because just-in-time distribution is getting harder and harder.”
Shelton sees further growth on the horizon for the company but with a catch.
“It’s all about managed growth,” he says. “There are a lot of challenges coming in the next five to 10 years in terms of the economic climate and the costs to operate. You better be able to run efficiently. We don’t want to be the biggest. We just want to be the best-run master distributor in the country.”