Issue link: http://www.insightdigital.biz/i/180153
Industrial Customers Suppliers – more than 300 (the top 20 vendors make up 37.49 percent of total scrap purchased). These include: Bassett Mechanical Ace Marine Burger Boat Blended Waxes Oshkosh Corporation Pierce Manufacturing John Deere Alliance Laundry Systems Vollrath Worthington Industries Robinson Metal Mercury Marine Kohler Company Metalcraft of Mayville Jagemann Stamping Co. Mayville Engineering Corp. Consumer Customers These include steel mills, foundries, nonferrous smelters, brokers, dealers, and export consumers – current active accounts exceed 150. The top 20 customers make up 79.02 percent of total sales. Neenah Foundry (exclusive agent) Waupaca Foundry Cronimet Corporation Aarrowcast Foundry (exclusive agent) Charter Steel Kohler Company Steel Dynamics SSAB Iowa CA Lawton Company Mercury Marine Deeter Foundry (exclusive agent) Beck Aluminum Osmose Inc. business advisory group). They worked with an advisory board. When Villaire joined them as CFO in 2008, he immediately led the charge for metrics. "We redesigned how we measure ourselves across the board, on every front," Villaire says. "There is nothing that didn't change, from operational metrics to financial metrics." They discovered that inventory was held on average for 73 days – a risky proposition in a commodities business, when prices can change so quickly. With that knowledge, they focused on reducing their inventory turnover to an average of 33 days. Safety rose to the forefront. The Bureau of Labor Statistics ranks refuse and recyclable material collectors as No. 4 on its list of most risky jobs. Sadoff has had a safety director since the 1990s, but an accidental death of an employee at the Fond du Lac scrapyard in 2011 jolted the company. An opportunity existed to change the mindset company-wide, says Jason Lasky, who led the implementation of Sadoff 's Safety Core, a structured approach based on five metrics and management expectations, "Our decision to go above the industry from a safety standpoint has been really paramount to us defining our culture," Jason says. "In our industry people have always w w w. i n s i g h t o n b u s i n e s s . c o m online: Click to hear Sadoff CEO Mark Lasky talk about how the scrap metal recycling business is always at the whims of commodities pricing. said, 'Accidents happen.' But we don't use that as an excuse at Sadoff. Our goal is for you to come to work every day and you leave the company the same every day. We've turned the corner in terms of culture and safety." Benchmarks for the future A ccording to Villaire, "getting the house in order" was critical to the company being able to weather the recession, which knocked the company off its feet as the commodities markets crashed in September 2008. "It was like we fell off a cliff," Mark recalls. "But we climbed out because we had built such a war chest in the first half of that year." Sadoff struggled in 2009, but 2010 and 2011 were the best years in the company's history, he says. While prices have been declining for the past 16 months, "it's a different scenario than in 2008 and 2009 because we are actually fairly busy." Financial advisors attest that the company has held its own and been strong enough that Sadoff has made two acquisitions in the last year. In September 2012 it acquired a nonferrous recycling facility in Omaha, 60 miles from its Lincoln, Neb. facility, which is undergoing an expansion to a new 13-acre site this month. And last February, Sadoff purchased the former Aluminum Specialty Company, whose major customer is Mercury Marine. Mark says he's "bullish" on the future. "We talk about how 'the bones' of our business are good. We've got good prospects. We're looking at different avenues for growth. We believe in the long-term, and I believe in the next 18 to 24 months, things will be better. What gives us some solace is that lower raw material prices now give consumers a chance to get healthier. "When you're a family business you can afford to look longer term. We don't manage the company quarter to quarter. We understand that what's going to be good for our consumers is going to be good for us. "If they're not profitable, we're not doing our job. And if we're not adding value, then what do they need us for?" O c t o b e r 2 013 • Insight | 27