Buying Steel Plate in Bulk — Four Steps You Should Follow

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Raw materials can considerably impact the cost of a specified project, rendering smart sourcing a key step in the process. While steel is a versatile raw material, the process of locating, purchasing, and transporting this alloy can be somewhat hazy. As a result, Leeco has developed four important steps that must be followed when purchasing a steel plate to make sure that the right steel has been sourced at a fair price for each project.

Step 1: Determine What is Needed

Although a steel supplier may be quite knowledgeable about the types and variety of steel grades, it is the customers who are ultimately responsible for defining the size, grade, and quantity of steel required. This first step is very important for obtaining a thorough and accurate quote from a steel supplier.

While there are a number of categories of steel plate products, the most common include:

• Military and ballistic steel
• Structural steel
• Quenched and tempered steel
• Abrasion-resistant steel
• Pressure vessel quality (PVQ) steel
• Marine and offshore steel

Each steel category contains grades that are appropriate for applications in various environments. These differences are usually documented with ductility, hardness, composition and strength tests.

It is the engineers who are eventually responsible for establishing which grade and type of steel are best suited to the project at hand. This is the reason why the required steel grade has to be communicated to the steel supplier.

Determine if Alternative Grades are an Option

There are certain projects that need highly specific grades of steel. Yet, there are some projects that have greater flexibility in the steel grade. For instance, if an abrasion-resistant steel with 480 BHN hardness is required, both AR 500 and AR 450 grades might be options for this project.

Knowing whether alternative grades of steel are suitable for a specific project could give customers more buying power with regards to availability and pricing, which will be discussed later in this article.

Size and Weight

Aside from knowing the required grade(s) of a project, knowing the size of steel plate required is one of the most rudimentary pieces of information needed by steel suppliers to quote an order.

A steel plate is bought in units of thickness x width x length. By definition, a steel plate has a minimum thickness of 0."&#; 0.24". While length and width can differ considerably, the most common dimensions of the steel plate are approximately 8 feet wide by 12 feet or 20 feet long.

Cutting tables enable the majority of steel plate suppliers to sell steel plates that are tailored to unique width and length dimensions. However, it is not possible to modify the thickness.

Although there may be slight variations, the weight of a steel plate is usually about the same, irrespective of the grade. To determine the estimated weight of a steel plate order, the quantity of plate should be multiplied by volume and density as follows:

Weight = {[Thickness (mm) x Width (mm) x Length (mm)] x 0. kg/mm3} x Plate Qty

Or, in inches and pounds:

Weight = {[Thickness (in) x Width (in) x Length (in)] x 0. lb/in3} x Plate Quantity

Weight = {[0.5 in x 96 in x 240 in] x 0. lb/in3} x 15 plates
     = {[11,520] x 0.} x 15
     = {3,267.072} x 15
     = 49,006.08 lbs

The steel&#;s density (0. lb/in3) can range anywhere between 0.28 and 0.291 lb/in3. While the above formula offers a good weight estimate, the weight of the end material may still differ slightly.

Benefits of Buying in Bulk

When a steel plate is purchased in large quantities, the price per unit of steel will decrease. The word &#;bulk&#; means at least sufficient steel for a single truckload, which is usually around 21 tons (42,000 lbs).

With respect to a standard 0.5 in x 8 feet x 20 feet steel plate (like in the weight calculation example given above), orders of 12 or more may possibly be regarded as bulk.

Suppliers of bulk steel plate &#; such as Leeco Steel&#; pass down cost savings from equipment and labor-use efficiencies (it takes time for a human, as well as a magnetic crane, to load steel plates) onto the per-unit cost of the steel.

Although many steel plate suppliers deal in partial and full truckload orders, they can usually be competitive with one-off or small orders as well.

Step 2: Evaluate the Timeline

Requiring steel this week versus requiring steel in three months can considerably influence the customers&#; choice of steel plate vendors and the overall price.

Steel plate suppliers typically have a finite inventory, which could all be housed in a single location, or could be spread across various locations, like it is done at Leeco Steel.

If the plate required by customers is available at a location close to them, then receiving the steel plate rapidly and cost-effectively is quite achievable.

Conversely, if the customers&#; steel plate requirements are unique and specific (for example, needing rare grades, uncommon sizes, or specific country of origin), steel plate suppliers may have to exclusively order the plate directly from a mill &#; a process that can take several months.

When assessing a steel plate supplier, customers should ask whether the product they need is in inventory, and where that inventory is with respect to the delivery destination.

Step 3: Pay Attention to Freight

Freight happens to be a key factor to the availability and cost of steel plates. Indeed, time and cost will be greater if the steel plate needs to travel further. Hence, one of the first freight questions customers should ask their steel plate supplier is, &#;Where is the order coming from?&#;

Vendors whose inventory locations are close to the customer&#; final destination may be able to meet their order at those locations, thereby reducing the cost and time spent on transportation. Obviously, having a physical inventory location does not necessarily mean that the supplier will be able to meet the order from that specific location.

The second question customers should ask their steel plate supplier is whether freight is included in their quote. For instance, Leeco Steel operates with a network of freight carriers and includes the expenses of transporting an order domestically in every quote, unless otherwise specified.

If freight solutions are not provided by a steel plate supplier, the team will assume responsibilities of directing the delivery, so it is imperative to clarify this at the time of the quoting process.

Step 4: Partner with Someone Who Can be Trusted

A company&#;s reputation, longevity, and trust play a key role when it comes to delivering steel plates. The following are some good trust indicators to use when assessing steel suppliers:

• Does the supplier possess ISO certification for quality management?
• Firms that have this certification have a set internal quality management system, which guarantees that customers receive their preferred product when they need it, and with the quality they expect.
• How many years has the supplier been in business?
• The best suppliers are those that have developed strong relationships with mills. While these associations take time, they give selected suppliers better rates and access to products.
• How many customers does the supplier have?
• If this number of customers is low, there could be a reason for this, but it could also mean that the supplier deals in particular industries. It is recommended to ask for customer references if their customer base is low.
• Where is the supplier based? In case the supplier has other locations, how many and where are they?
• Locations not only affect the speed of delivery and inventory quantity, but they also indicate the longevity of a company. Fly-by-night suppliers may not have multiple locations.
• Does the supplier have a purchasing team?
• Purchasing teams are specialists at sourcing steel, purchasing, and documenting paperwork as well as identifying the best rates and/or fastest deliverability. Since sourcing steel takes an organized team effort, understanding if the supplier has an experienced, dedicated team plays a major role in the quantities and grades of steel available to customers.

This information has been sourced, reviewed and adapted from materials provided by Leeco Steel, LLC.

For more information on this source, please visit Leeco Steel, LLC.

Overview: Retailers, Suppliers & Mills

When sourcing raw steel plate, purchasing managers have three primary steel plate sources: retailers, suppliers (also known as distributors) or mills.

Retailers include everything from big-box chains &#; such as Home Depot &#; to independent metal specialists, in-stores and online. With retailers, customers can simply walk into a store or browse a website, select an item and purchase the item at will.

Suppliers are &#;material middlemen.&#; They buy steel plate in bulk from a mill at discounted rates, store it in high quantities in warehouses and then sell the material to buyers with medium or high quantity needs.

Suppliers often sell by the &#;truckload,&#; or between 20,000 lbs. and 40,000 lbs. Suppliers offer a greater selection of steel plate product at lower per-hundredweight cost than retailers, since they deal primarily in bulk.

Mills are the producers of steel plate materials and offer a varied selection of steel plate product. In most cases, mills only sell direct to buyers in need of very large volumes of steel plate.

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Service centers are another common source for processed steel plate (such as plate cut to specific sizes or shapes), but we will not focus on service centers in this article due to the variety of metal processing service options.

Related: Common Ways Steel Plate is Processed

Choosing Between Retailers, Suppliers & Mills

So which steel plate source is best for you? The answer depends on buyer needs surrounding five primary factors:

• Convenience: how quickly and easily do you need access to steel plate material?
• Product variety: are the grades and sizes you need common or specific?
• Price per hundredweight.
• Volume: how much product do you need?
• Inventory risk: can you buy in bulk and store excess? Or do you need smaller orders delivered over time?
• Buying methods: what options are available for placing an order?

Understanding your specific needs in each category will help determine which sourcing method(s) may be best for you.

Convenience

The most distinct difference between buying from retailers, suppliers and mills is the degree of convenience offered by each source.

Retailers are highly convenient. They carry very few steel plate products, but have these products readily available at all times. Retailers typically allow buyers to place a steel plate order via their website, which gives buyers the option to buy plate in just a few clicks.

Suppliers are significantly more convenient than mills, because they often have deep inventories and multiple inventory locations. They can respond to steel plate needs quickly (sometimes even within the same day), whereas mills usually require more than a month lead time on an order. Some suppliers, like Leeco Steel, are beginning to offer customers the option of ordering steel plate online via an ecommerce website to add convenience to the buying process.

Additionally, suppliers usually have experienced in-house teams that understand how to deliver large steel plate orders, which is an important convenience for many medium-to-large volume buyers.

Mills offer the lowest level of convenience, as they fill their production &#;books&#; (AKA: schedules) months in advance. Suppliers and retailers can handle these longer lead times due to large on-hand inventories, but buyers typically cannot. This is why only large buyers with specific, known material needs tend to purchase steel plate directly from mills.

Convenience of Credit

Retailers usually accept cash, check or credit card payments at the time the order is placed, making them highly convenient for smaller buyers.

Suppliers and mills almost never accept credit card payments due the large value of the average order. In fact, most suppliers and mills require buyers to undergo a business credit evaluation before the buyer can even buy.

Once a supplier or mill extend credit limits, buyers do have the convenience to place orders in advance but pay when material is received. In these situations, mills adhere to a strict 30-day payment window.

Suppliers have dedicated credit evaluation teams to assess credit risk and can therefore offer more flexible payment windows (i.e. 45-60 days), making them more convenient for medium-to-large buyers.

Product Variety

Retailers offer a limited variety of steel plate products. They typically only carry common grades, such as ASTM A36 and AR400, and usually only in smaller sizes.

Mills, of course, offer the highest degree of product variety, as they can produce-to-order hundreds of grades across a wide range of thicknesses, lengths and widths.

Suppliers may not carry as wide of a variety of grades as mills, but they can often quickly procure whatever grades and sizes are needed because they buy from a network of mills. In these situations, suppliers offer a service to customers by doing the sourcing leg-work for them.

Price Per Hundredweight

Steel plate is priced per hundredweight &#; or cwt. Retailers offer significantly higher cwt than suppliers and mills as a tradeoff for the convenience of immediate product access and easy cash or credit payment.

Related: How much does steel plate cost?

Suppliers have stronger buying relationships with mills that allow them to buy steel plate at more competitive rates than retailers and most large buyers. Additionally, suppliers usually have lower operational overhead, as they have fewer facilities and greater fulfillment efficiencies, since their orders are larger in volume.

Mills can sometimes offer a lower cwt price than suppliers (depends on the grade), but they only sell to very high-volume buyers, and orders can take months to fulfill. What buyers might get with cost savings, they lose with convenience and speed.

Average Order Volume

The volume of a buyer&#;s need often helps narrow the choice of supplier. Retailers specialize in handling low-volume needs, especially orders less than 200lbs. Orders under 200lbs. can be shipped via standard ship methods, unlike heavier orders that require freight transit.

Suppliers&#; sweet spot is any order greater than 20,000 lbs./10 tons (about half a truckload) up to whatever inventory limitations the supplier has for the requested grade and size.

It&#;s not that suppliers would never fulfill a low-volume need, it&#;s often that they simply do not have small-sized material. Most steel plate stocked by suppliers is 8-10ft wide by 20-40ft long. This would be well beyond the volume need of many retail customers, who typically request plate under 2ft wide by 2ft long.

Mills, on the other hand, thrive on high-volume orders. Mills produce heats &#; or batches &#; of steel plate products, usually in quantities of 120-150 tons per heat. When mills supply to direct buyers, they are usually supplying one or more heats multiple times per year.

Inventory Risk

One huge advantage of buying steel plate from suppliers or retailers is reduced inventory risk. Buyers can receive the exact inventory they need, when they need it, and not have to worry about running short or not having space to store excess material.

Suppliers offer the lowest amount of risk related to inventory levels, since they themselves have healthy levels of material on-hand and have a network of mills from which they purchase. If one mill delays an order, suppliers can turn to other mills for the material.

Retailers also offer low inventory risk, but have less demand visibility than suppliers (who often sell a bulk of their orders via contract, and can predict demand). For this reason, retailers have higher inventory depletion risk than suppliers.

Purchasing through mills comes with a lot of inventory risk. Buyers typically must buy larger loads of material and store the material until depleted. This requires ample storage facilities and the ability to move and manage steel plate (i.e. overhead magnetic cranes).

Additionally, mills are more at risk of running behind in production. These delays in inventory could leave a buyer scrambling to find material to bridge the gap between depletion and the next mill delivery.

Buying Methods

Retailers, suppliers and mills each offer different methods for buying steel plate, and it is important to consider which method best suits your order needs and which source is able to accommodate those needs.

Retailers offer the most buying methods, with the option to purchase steel plate in-person, on a website or over the . This gives buyers great flexibility in how they can purchase plate materials. However, buying from a retailer tends to be more impersonal, so they may not be able to accommodate special requests for less common grades or extensive processing.

Suppliers traditionally take steel plate orders through direct communication with a sales representative. But some &#; like Leeco &#; also offer the option to buy through an ecommerce website. Flexibility in how orders are placed allows buyers to customize the purchasing process based on their requirements. Buyers with simpler needs who are looking to quickly order a popular plate grade can opt to buy online, while buyers with more complex, specific needs can work directly with an experienced sales representative.

Mills offer the least flexibility in buying options, as they typically take orders via or with a sales representative. Most mills due not offer the option to buy steel plate online.

Weighing Your Options

With each steel plate supply source, there are strengths and trade-offs. Determining how important each factor is for you &#; as well as any other factors important to your business &#; will help guide you towards the right steel plate supply source.

Leeco® Steel is the largest supplier of steel plate in North America and services clients big and small with a wide range of volume and delivery needs. We would be happy to quote your next project and would be honored to be your steel plate supplier of choice. Submit an inquiry here.

If you want to learn more, please visit our website Structural Steel Products Wholesale.