Metals USA sees stocks driving growth

Nov 22, 2010 | 01:03 PM | Anne Riley

Metals USA Holdings Corp.'s decision to build out inventories ahead of more cautious competitors is helping it capture market share, the company's top executive said—even as other service centers maintain that bigger isn't better when it comes to overall stock levels.

Metals USA has been building inventories at a faster rate than other players in the still tepid distribution sector, putting it in a better position to supply customers and grow its business, according to Lourenco Goncalves, the company's chairman, president and chief executive officer.

"After so many months in a row of service centers working out of really depleted inventories, they are starting not to have it when customers need it," he told AMM. "What we are doing is continuing to provide service to customers in the way we always have, and the only way to do it is to have inventory on the floor."

Goncalves declined to comment on how much more inventory Fort Lauderdale, Fla.-based Metals USA is holding than at this time last quarter, but he confirmed that the company is raising stocks to supply some of the more robust business segments.....