To no one’s surprise, the North American service center space retreated from its record-high sales figures reported in last year’s list. But revenues remain well above historical norms for the continent’s largest distribution companies. (Photo courtesy Reliance)
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The rapid growth of the prior two years for service center companies came to a predictable end in 2023, a byproduct of lower sales volumes and prices. That fact was evident in the 2024 MCN Top 50 Service Center list.
The Top 50 service centers in North America reported sales of $76.5 billion in 2023, down 10 percent from the record-high $84.9 billion in the 2022 fiscal year. On the other hand, the total is still higher than any pre-COVID year since
Metal Center News began tracking this data at the turn of the century.
Even North America’s largest service center company was not immune from the industry decline in 2023. Even with its typical acquisitions expanding its holdings, Reliance’s net sales decreased from a record $17 billion to $14.8 billion in 2023. Still, the Scottsdale-based company’s 2023 revenues represented almost 20 percent of the entire Top 50.
Each year,
Metal Center News invites the continent’s largest service center companies to submit sales data from the previous year, to be compiled in the September issue. Now in its 22nd year, the MCN Top 50 is the most authoritative listing of the size of the multibillion-dollar metals distribution space.
Even with the decline in sales, Reliance maintained a firm lock at the top of the service center pile. Ryerson, which held the top spot until Reliance grabbed it 17 years ago, remains the second-largest in the service center space. The Chicago-based service center company reported sales of $5.1 billion in 2023, a decline of 19 percent from the prior year.
One year after being a non-respondent in the survey, thyssenkrupp Materials North America jumped to its highest position in the Top 50, coming in third with 2023 revenues of $4.14 billion. The Southfield, Mich.-based company had been a list fixture before missing out in 2023.
Rounding out the Top 5 were a couple of Southeastern companies, Kloeckner Metals Corp. and O’Neal Industries. Roswell, Ga.-based Kloeckner, No. 3 last year, had revenues of $4.1 billion, while Birmingham, Ala.-based ONI bounced up from No. 8 with 2023 sales of $3.6 billion.
The rest of the Top 10 were the other metals distribution companies with more than $3 billion in sales in 2023. Worthington Steel, Columbus, Ohio, came in at No. 6 with $3.4 billion; followed by Russel Metals, Mississauga, Ontario, with $3.4 billion; Steel Technologies, Louisville, Ky., with $3.2 billion; Alro Steel, Jackson, Mich.; with $3.15 billion; and Toyota Tsusho America, Georgetown, Ky.; with $3.2 billion.
Last year’s 10th-ranked company, Samuel, Son & Co., Ltd., was the most notable non-respondent this year. Another Top 50 fixture, Owen Industries, also did not submit the form for inclusion.
While Reliance’s place at the top is likely secure for quite some time, there may be some shakeup in the Top 10 next year following Russel’s acquisitions of seven service center companies from fellow Canadian company Samuel.
The number of companies reporting sales in excess of 10 figures dipped again this year. While thyssenkrupp Materials North America took Samuel’s spot in the Billion Dollar Club and Coilplus rejoined the field, Heidtman Steel, Majestic Steel, Kenwal and Steel Summit all dropped below $1 billion in sales last year.
This year’s list features two notable newcomers, Friedman Industries and State Steel. Friedman, a Longview, Texas-based company, had 2023 sales of $508 million, putting it in the. No. 33 slot in the Top 50. Sioux City, Iowa-based State Steel slipped into the No. 38 slot with revenues of $345 million.
The biggest jump on this year’s list came from a company that has been on a wild ride the past 10 years. Castle Metals, which was acquired by Banner Industries, jumped 11 spots to No. 20 with 2023 sales of $900 million. Castle was also the largest gainer in the 2023 Top 50, which came upon the heels of several years of declining sales.
No other company jumped more than four slots in this year’s list.
Perhaps the most noteworthy aspect of this year’s Top 50 is found in the projections for 2024. While many of the largest companies do not offer projected sales figures, those who do show an array of answers not typically found in the annual survey. An almost even number of companies are expecting sales to be slightly larger in full-year 2024 as the number of companies who are forecasting a decline. Typically, the results tend to move in the same direction, again driven by demand and pricing levels for steel and other metals in the year in question.
Reliance, of course, does not just lead in sales, but in every metric Metal Center News covers in the survey. The company has 315 stocking locations, 185 more than Russel, second in the category. Its employees number 15,000, almost 10,000 more than thyssenkrupp Materials North America’s 5,295. And its square footage of 37 million is again well ahead of tkMNA and its 13 million square feet.
Altogether, the Top 50 service centers maintained 1,433 stocking locations, up significantly from the prior list when the largest companies operated 1,313 facilities.
The industry also seemed to have a better handle on its personnel situation, a problem that has plagued all sectors of the industrial economy since the early days of the pandemic. The Top 50 reported 66,580 employees on the books last year, an increase of more than 3,000 employees from the prior year.