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Hanshin Metalics: The hub that connects steelmakers and customers

Article - June 21, 2023

Speed and cost are crucial factors in the manufacturing industry and, as a special steel trading company, Hanshin Metalics delivers proposals that ensure superior results at all times.

“We have special materials in Japan, and we are currently looking for companies in Europe and the U.S.A. that genuinely need them.”

Toshihiko Kawai, President & CEO, Hanshin Metalics Corp.

First established in 1956, Hanshin Metalics has been supplying materials and parts to manufacturers within the industrial machinery sector for the best part of 70 years.

Currently, the company supplies round-shaped parts for all kinds of industries, such as hydraulic parts for construction machinery, spindles and housings; valve rods and flanges for machine tools; and shafts and sleeves for pumps. Through its external supply chain, meanwhile, clients can access services such as heat treatment, surface treatment and other required processes.

More than just a special steel trading company, Hanshin Metalics is a one-stop solution for customers, providing machining services in addition to its stock service.

As company president Toshihiko Kawai explains, if production flow is a river, then Hanshin “acts as a hub to cater to different needs and to maximize efficiency when it comes to the transportation of materials, consolidating materials, processing, heat treatment and logistics for a premium service.”

Unlike many sectors, Hanshin Metalics, with seven bases in the Kansai region, emerged from the COVID-19 pandemic relatively unscathed and, in fact, has achieved record performance. This, says Mr. Kawai, is due to the firm’s willingness to expand into new areas and cultivate new clients.

"One of the new areas we have begun to focus on is the aerospace industry and we have acquired JIS Q9100. Since the establishment of our Aerospace Division in 2014, we have developed direct business relationships not only with domestic steelmakers but also with steelmakers in the United States, the U.K., Taiwan, Italy and eight other countries in order to supply special materials to domestic aircraft parts manufacturers. Now, we are one of the stockists with the largest inventory of 15-5PH in East Asia and have supplied them for not only to the domestic market in Japan, but also Western and Asian countries."

Hanshin’s ability to procure materials such as titanium alloys and machine them in-house gives the firm a significant advantage over competitors, with a 20 MPa ultra-high-pressure coolant allowing it to cut materials at higher speeds and lower costs than other market leaders. The company continues to evolve and in recent years has supplied final products by offering surface treatments such as thermal spraying, overlay and plating, achieving customer satisfaction at home and abroad.

Elsewhere the rapid depreciation of the yen does not necessarily spell doom for Japanese suppliers. Mr. Kawai says: “We see the exchange rate situation as an advantage, and an opportunity to increase exports of machined parts to other areas such as the U.S.A. and Europe.” Japanese suppliers, already highly regarded for the quality of their output, stand to operate at a significant cost advantage for their overseas clients. By way of example, a 100,000-yen product that cost around $910 in 2020, would now be available for $690, a reduction of almost 25% even though the quality of the product remains the same.

Looking to the future, Mr. Kawai has identified the wind power and green technology sectors as presenting opportunities to move into the U.S. and European markets.

The shortcut to the company’s overall prosperity, however, lies in the growth of local staff through self-reliance. “We don’t want one CEO to control the entire company,” Mr. Kawai says. “Instead, we want all employees to think as a CEO thinks, and to increase sales and the company’s potential on their own. By letting them think for themselves, they grow by themselves.”

Soundraw Inc, meanwhile, an affiliated company, offers a subscription-based service that allows customers to create and download their own music, and is gaining significant attention in the United States. Employees who think independently can create such new trends in completely different areas.

Mr. Kawai stresses that spreading joy is one of the core tenets of his philosophy. “I believe that life is about seeing how many people we can make happy. And in the next four years I will be striving to make as many people happy as possible.”