PITTSBURGH Success doesnt come overnight, and the sweat equity required to turn a company around might not be evident for three years, Robert B. Brewer, who took over as PSC Metals Inc.s chief executive officer almost a year ago, told AMM in an interview.
"One year is too short to accomplish anything because in the first year people need to embrace the change. For example, initiatives that are set in place in year two will effectively start to show in year three. Anything quicker is short-lived and not sustainable," he said, admitting that he has his work cut out for him.
Brewer has taken plenty of action since arriving at PSC Metals in September 2012 (amm.com, Aug. 29), including shutting down eight yards and idling two auto shredders (amm.com, May 16).
PSC Metals isnt alone, with the industry as a whole pressured by diminished margins. "Scrap metal businesses grew too fast and there is now a lot of competition with too many shredders," he said.
Brewer has had no qualms about closing facilities that were a drain on the company, with each facility judged on a standalone basis.
"The yards were mostly community recycling centers that were not making money or couldnt bear the number of competitors in the area and we were not at the top. If we arent at the top, we need to either get there or pack up and get out of town," he said.
On some days the job has felt like walking in three feet of mud, but Brewer is positive. "The market is tough and this is an opportunity to get strong under these conditions while others are trying to survive," he said.
Leaving a career that spanned two decades at OmniSource Corp. has been a bittersweet decision. Brewer enjoyed his time there, but relished the chance to work for Mayfield Heights, Ohio-based PSC Metals, owned by Icahn Enterprises LP, he said.
"I really liked working at Omni and it was giving up a lot (to leave). What Icahn Enterprises related with this business was they were looking for an operator, team builder and consolidator and wanted attentions focused on operations," he said.
Brewer, who was executive vice president of OmniSource Southeast when interviewed by Icahn Enterprises, possesses a deep love of the operations side of the business.
Sitting behind a desk isnt that comfortable for a hands-on guy, and Brewer is adapting his work ethic to running the company.
"My managing style is like a coach. I like being around innovative people and (being) allowed to exercise teaching and coaching as a style. People will say Bob is very committed to doing things his way, which is a development of a combination of what I have been exposed to from very talented mentors," Brewer said.
Having the opportunity to work indirectly for Leonard Rifkin, founder of Fort Wayne, Ind.-based OmniSource, taught Brewer the importance of being who you are.
"Leonard Rifkin was a giant and yet showed complete humility," Brewer said.
Brewer is working with the PSC leadership team to strengthen a company that has had several changes of leadership.
Building a corporate culture is a daunting task. "I was naïve and didnt realize the amount of work a (chief executive officer) at any company does, and I underestimated the amount of work before me in building a foundation," he said.
PSC Metals roots are a blend of many different successful companies that have been folded under its umbrella, including Luntz Brothers Corp., Luria Brothers Inc., Shapiro Brothers Inc., Steiner-Liff Metals Group, Southern Foundry Supply Inc., Wooster Iron & Metal Co. and Cashs Scrap Metal & Iron Inc.
Brewer is working to forge an internal sense of pride working for the company and is interested in what everyone has to say. "I dont like losing touch with day-to-day operations. I interact with employees from all over the company and I receive calls from employees with concerns and suggestions. I tell them I am a resource for you, find out what they need and listen to what they have to say," he said.
PSC does have its strengths, Brewer said. "It has an effective footprint and operates where the metals (mills) are and there is a core group of people who know market requirements," he said.
"Our competitive advantage is our excellent group of traders and operators," he said.
Other, often overlooked, key players are scale buyers. "Scale buying is an art and it is important to buy well. Some buyers dont understand yield loss and costs and mistakenly think they will get it back in the nonferrous," Brewer said.
"Cars are really stripped and gleaned these days, so that isnt a guarantee," he said, adding that good buyers actually look at the loads rather than buy over the phone.
Brewer said he is undaunted by the volatility in the market, though it can be frustrating. "You enjoy the cycle when it is up and you make money without trying. In down times, it seems like anything and everything you do doesnt make a mole hill of a difference no matter how hard you work some days," he said.
To monitor the market, Brewer said he pays attention to peddler counts at collection yards and queues from mill buyers as to their melting needs. The company isnt speculating, but buying and selling out each month, he said.
Brewers goal for PSC is to not only be successful, but also to instill a sense of pride and camaraderie among the work force, something that he learned at OmniSource.
"My whole knowledge base is Omnis tutelage, and it is good tutelage. I learned a lot during my 20 years there, where I spent a lot of time below the deck rowing. But I am also cognizant of the great legacy of the PSC past," he said.