By Dan Markham,
Senior Editor

• Quick Facts
  

For 35 years, Titanium Industries has been the first name in titanium. The Rockaway, N.J.-based company claims to be the world’s largest distributor of titanium. Its website, www.titanium.com, is the default choice for information on the specialty metal. Its strong corporate identity is an asset when selling titanium—but it proved to be a liability in selling other products.

Over the years, Titanium Industries expanded its reach, adding nickel and other metals to satisfy the requests of existing customers. While those customers took advantage of the company’s growing inventory of non-titanium alloys, Titanium Industries found it more difficult to gain traction with new customers.

“Part of the problem we had was going into someone’s office and leaving a business card, which says Titanium Industries with a website Titanium.com,” says Jeff Wise, the company’s vice president of sales and marketing. “That guy comes up with a nickel order two months later and Titanium Industries is not the first name that comes to his mind.”

Titanium Industries is addressing the problem by creating a new division, High Performance Metal, to market its non-titanium lines. The company will stock nickel 718 and nickel 625, while exploring the feasibility of cobalt-chrome-moly, 316L stainless and other alloys.

“We decided to rebrand ourselves,” Wise says, noting that the company has registered the High Performance Metal web domain name in countries where Titanium Industries has existing operations.

“Titanium value-added distribution and manufacturing built Titanium Industries and will continue to be our core business,” says Chairman and CEO Jim Paddock. “However, this diversification offers greater growth opportunities and stability than any single metal can provide.”

Jay Pudlock will manage the new division from the company’s Wood Dale, Ill., facility, though the company’s primary warehouse in Rockaway will stock most of the material. Pudlock has extensive experience in both titanium and non-titanium markets.

Titanium Industries was founded in 1972 in Fairfield, N.J., when Paddock broke away from an existing titanium fabrication and distribution business. He took the distribution business, leaving the still-existing Titanium Fabrication behind.

The company relocated to Parsippany, N.J., shortly thereafter, operating out of a leased space. It wasn’t until 2006 that Titanium Industries moved its headquarters and main warehouse to the 90,000-square-foot building it now owns in Rockaway.

Titanium Industries operates other stocking locations in various regions of the country, including the Chicago suburb of Wood Dale; Santa Fe Springs, Calif.; Hillsboro, Texas; and Jacksonville, Fla.

A sixth North American operation is located in Montreal. All of the other properties are leased. “Unless you are very good at real estate, it doesn’t make much sense to own,” Wise says.

Three years ago, the company restored its overseas presence with the opening of facilities in Birmingham, England, and Taipei, Taiwan. It had previously operated facilities in the UK and Singapore, but closed them during a change in ownership.

Titanium Industries is not finished with its global outreach. The company intends to open facilities in India, Poland and Brazil.

“One of those will become a reality, probably India, by first quarter of next year,” Wise says. “And the other two will come right after that.”

Titanium Industries is also expanding its value-added capabilities. The company offers first-stage processing including sawing, water-jet cutting, shearing, fabrication and welding instruction. It is in the process of adding more water-jet cutting machines at several of its locations.

The company serves three major end-use classifications, with 40 percent of sales going to aerospace customers and 30 percent to medical customers. The other 30 percent is divided among numerous industrial customers and some service centers.

Titanium Industries stocks bar, plate, sheet, tube, pipe, wire, fittings, billets, slabs and ingots, though the product mix differs by location.

“Industrial markets are very strong in Asia, so they stock a lot of pipe. Jacksonville is basically the pipe and fitting center of the company. The medical market is handled out of Chicago, so their inventory is much different than our inventory in Jacksonville,” Wise says.

Of all the changes Titanium Industries has made in recent years, none was as innovative as its shift from a pure distributor to a “manufacturing distributor.” In addition to distributing titanium products, Titanium Industries also manufactures them.

“We melt scrap, then forge the ingots at an outside forging company. We take that product, cut it up and make block, plate and billet bar,” says Wise. “Under our quality-control program, we monitor the melting and monitor the forging.”

Titanium Industries added its manufacturing capabilities several years ago when titanium was in short supply and the company couldn’t get enough material to satisfy customers’ needs. It has proved to be a useful and profitable method of dealing with excess scrap.

“We generate so much scrap,” he says. “We can either sell it on the open market and get a little bit of money for it, or we can make a new ingot out of it and produce a product that resells at a much higher margin.”

The company sells 100 percent of its own product, though that accounts for only 20 percent of its volume. Titanium Industries is comfortable with that ratio of homegrown product vs. material procured on the world market, Wise says. In fact, it’s the approach they will be taking to High Performance Metal.

“We’ll use that same business model in non-titanium,” he says. “We’ll manufacture a portion of what we sell, and purchase the balance from the open market.”